1.1 Introduction
Agriculture is known as the engine and panacea for economic growth in most developing nations of the world. It is also regarded as the basis for economic growth, development and poverty eradication in the developing countries. Nigerian economy in past decades strives on the agricultural sector. The agricultural sector is reputed as the mainstay of the economy in the early 1960's. Agricultural sector is seen as the key driver for growth and development.
In fact to further buttress the pivotal role the agricultural sector plays in the Nigerian economy, the agricultural sector is part of the Millennium Development Goals (MDG's) program of poverty reduction in Nigeria. In most developing countries, the agricultural sector remains, food, employment opportunities, provision of foreign earnings from exportation of the surpluses, and more importantly the enormous advantage of the value added in the various production process (Okoro, 2011).
As a prelude to other parts of this study, this chapter will discuss the background upon which this study was initiated, the statement of problems that led to this study, the Aim and Objectives of the study. Others are Significance of the study, Scope of work, Research hypothesis and questions, Limitation of the study and Definition of terms.
1.2 Background of Study
Agriculture has been the backbone of the economy in Nigeria providing employment and source of livelihood for the increasing population it accounts for over half of the GDP of the Nigerian economy as at independence in 1960. However, the role it plays in the regional and economic development of the country has diminished over the years due to the dominant role of the crude oil sector in the economy. Originally an agriculture dependent country, Nigeria shifted focus to oil exports in the 1970s and decades of slow economic growth later; there is a need to refocus on agriculture. With the pressure to attain the MGDs, it is important to investigate the contribution of the sector to Nigeria's economic growth. Agriculture contributes 40% of the Gross Domestic Product (GDP) and employs about 70% of the working population in Nigeria (CIA, 2012). Agriculture is also the largest economic activity in the rural area where almost 50% of the population lives.
Agriculture contributes significantly to national food self–sufficiency by accounting for over 90% of total food consumption requirements, its helps to maintain a healthy and peaceful population and also a source of food and nutrition for households. Furthermore the ultimate objective of interest of economists in productivity should be to find ways of increasing output per unit of input and attaining desirable inter-firm, intra-firm and inter sector transfers of population resources thereby providing the means of raising the standard of living. With the increasing food demand in Nigeria, the country has available natural resources and potential for increasing the volume of crop production towards meeting the food and nutritional requirement of the rapidly increasing population and guarantee food security in the country.
Iganiga and Unemhilin (2011) and Oji-Okoro (2011) found that agricultural output is significantly influenced by government capital expenditure. Iyoha and Oriakhi, (2002) identified the sources of economic growth in Nigeria using the growth accounting model and found that agriculture contributes more than expected to GDP growth.
Agriculture indeed has remained the major sources of income to the economy. About 90% of the rural population is involved in activities related to the crop sub-sector which provides the bulk of agricultural income. Similarly the crop sub-sector supports the processing industry by providing raw materials.
The agriculture sector has been the mainstay of the economy since independence and despite several bottlenecks; it remains a resilient sustainer of the populace. In the 1960s, Nigeria was the world's largest exporter of groundnut, the second largest exporter of cocoa and palm produce and an important exporter of rubber, cotton (Sekunmade, 2009). More recently, agriculture employs about two-thirds of Nigeria's labour force, contributes significantly to the GDP and provides a large proportion of non-oil earnings (CIA, 2013; Sekunmade, 2009).
Therefore, in Nigeria where the research was carried out, the activities that was conducted is to know the Contribution of the Agricultural Sector to the Development of Nigeria Economy.
1.3 Statement of Problems
Investigation revealed that there has been a downturn in the late 1970s and figures have dropped significantly to 20 percent at the end of the 1990s. The decline in the agricultural sectors’ contribution is explained by the oil boom in the late 1970s. The 1970s outlined the period when oil was discovered in commercial quantity. This discovery has led to the neglect of the agricultural sector and more focus on the petroleum sector. The sole dependence on oil turned Nigeria into a monoculture economy. Nigeria is endowed with a large deposit of agricultural resources and huge arable land for the cultivation of crops and rearing of animals.
In the 1960s and 1970s the agricultural sector constituted over 65 percent of total export. The Nigerian agricultural sector was renowned for the export of cash crops namely cocoa, rubber, hides and skin, groundnut palm among a host of many others. The agricultural sector holds an enormous potential for the growth and economic development of the country (Manyong et al., 2005).
1.4 Aim and Objectives of Study
The aim of the study is to investigate the Contribution of the Agricultural Sector to the Development of Nigeria Economy. In achieving this aim, the following specific objectives were laid out as follows:
- To identify the various challenges facing the development of the agricultural sector in Nigeria;
- To determine the roles of the agricultural sector to economic growth in Nigeria;
- To examine the long-run relationship among agricultural sector and the Nigerian economy; and
- To examine the factors that leads to inconsistencies in the agricultural sector's contribution to economic growth.
1.5 Research Questions
The study came up with research questions so as to be able to ascertain the above stated objectives. The specific research questions for the study are stated below as follows:
- Are there factors that lead to inconsistencies in the agricultural sector's contribution to economic growth?
- Is there any long-run relationship among agricultural sector and the Nigerian economy?
- What are the roles of the agricultural sector to economic growth in Nigeria?
- What are the various challenges facing the development of the agricultural sector in Nigeria?
1.6 Research Hypothesis
In order to pursue the objective of this study, the following generalized statements have been designed to guide and aids in obtaining the result for the experiment to be conducted. For this work, the null hypothesis will be represented with H0 while the alternative hypothesis will be represented with hypothesis H1.
Hypothesis One
- H0: There are no significant factors that lead to inconsistencies in the agricultural sector's contribution to economic growth
- H1: There are significant factors that lead to inconsistencies in the agricultural sector's contribution to economic growth
1.7 Significance of Study
This research will give evidence of the impact of growth in each subsector of the agriculture sector will have on growth in the sector as further evidence on the source of economic growth. The crop production subsector contributes the most to agriculture sector growth and that growth in the agriculture sector is overly dependent on growth of the crop production subsector.
Finally, increased efforts in developing the livestock, fisheries and forestry subsectors will foster the contributions of agriculture sector to the Nigerian economy. This study will be of immense benefit to other researchers who intend to know more on this study and can also be used by non-researchers to build more on their research work.
1.8 Scope of Study
The scope of the research is focused on the Contribution of the Agricultural Sector to the Development of Nigeria Economy.
1.9 Limitations of the Study
During the course of this study, many things militated against its completion, some of which are:
- Time Constraint: The time frame given to accomplish this project was very short due to school academic calendar and it was carried out under pressure which made the researcher not to implement some necessary features.
- Establishment Policies: Establishment policies posed a serious limitation as most staffs are not ready to release information needed for this research work. There were lots of information needed from the staffs of this establishment to enhance the study which took them time to release or they did not release at all for security purposes, hence the scope was reduced.
- Research material: availability of research material is a major setback to the scope of the study.
- Frequent power failure: This made the researcher append more money on fuel to ensure sustainable power.
- Financial Constraint: Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).
1.10 Definition of Terms
Impact: Impact is defined as the action of one object coming forcibly into contact with another or a marked effect or influence.
Organization: An organization or organization is an entity comprising multiple people, such as an institution or an association, which has a collective goal and is linked to an external environment.
