DOWNLOAD THE FULL PROJECT

875 Users found this project useful

IMPACTS OF AGRICULTURE ON NIGERIAN ECONOMY

CHAPTER ONE

INTRODUCTION

1.1       Background of the Study

Since independence in 1960, Nigeria has consistently pursued growth strategies and has achieved GDP (Gross Domestic Product) growth rate of 6% in 2006, 7% in 2011 and 7% in 2012 and as Africa's largest economy with 2013 GDP estimated at US$ 502 billion (Economy Watch, 2015). The GDP in Nigeria increased by 2.35% in the second quarter of 2015 over the same quarter of the previous year (Trading Economics, 2015). This growth has not been able to translate into a reduction in poverty as the country remains poor in the face of growing population while unemployment rate rose from 12.3% in 2006 to attain an all-time high rate of 23.9% in 2011 and 24% in 2013, and with over 70% of its labour force involved in agriculture, hence the quality of life of an average Nigerian has not improved (IMF, 2012). It is therefore theoretically unreasonable and represents the paradox of growth in the face of poverty, unemployment and inequality (Fefa and Okwori, 2014). 

Although, Omawale and Rodriguez (1979) opined that for most developing countries like Nigeria, agriculture has been assigned an important role in national development. Therefore the role of agriculture in transforming both the social, economic and institutional framework of an economy cannot be over emphasized. Ugochukwu (1999) asserted that agriculture is the first and most thriven occupation of mankind likewise Anyanwu, Oyefus, Oaikhenan and Dimowo

(1997)who reported that agriculture has been the main source of gainful employment from which Nigeria can feed its increasing population, providing the nations industries with local raw materials and as a reliable source of government revenue while Reynold (1975) asserted that agricultural development can promote economic development by increasing the supply of food available for domestic consumption and releasing the labour needed for industrial employment.

However, Agriculture production is engulfed by many challenging factors such as low prices of the products at the market, lack of storage and processing facilities, among others leading to low returns. Thus adding value to agricultural products is a worthwhile endeavor because of the higher returns that come with the investment, the opportunity to open new markets and extend the producer’s marketing season as well as creating new recognition for the farm. According to Boland (2009), adding value is the process of changing or transforming a product from its original state to a more valuable state, or by changing its current place, time and from one set of characteristics to other characteristics that are more preferred in the marketplace that would lead to greater opportunities for product differentiation and added value to raw commodities. Don (2010) opined that value added agriculture has been touted as the solution to the problems facing farmers and rural residents and that people promoting value added agriculture claim that it will increase output and reduce financial stress in the farm sector and lead to the revitalization of rural communities. He acclaimed that value added agriculture’s potentials lies in creating long term solutions rather than short term fixes. Although, Born (2001) identified the keys to success in value added agriculture as high quality, good record keeping, planning and evaluation, perseverance, focus, and building long term relationships with customers. Therefore the need to become engaged in value added activity reflects the need to shore up farm income which has been declining in recent years (Evans, 2015).

  DOWNLOAD THE FULL PROJECT