| Agriculture |    925 VIEWS  |
| Agriculture | |
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| PROSHARE | |
| PROSHARE | |
Tuesday,
June 30, 2020 / 12:55 PM / By PwC Nigeria / Header Image Credit: PwC Nigeria
The Nigerian agricultural sector holds the key to the
country's drive for economic diversification. The sector has grown consistently
at an average of 2.6% over the past three years. As at Q1 2020, agriculture
accounted for about 22% of the Nigerian gross domestic product (GDP) compared
to oil and gas (9.5%), manufacturing (9.7%), financial services (3.8%) and
trade (16.1%). In addition, the agricultural sector remains the largest
employer of labour in the country, providing jobs for more than one-third
(86.4%) of the Nigerian labour force.
However, agriculture in Nigeria still faces many
challenges. Some of these include adverse weather conditions associated with
climate change, herder-farmer clashes, terrorism in the northeast, cattle
rustling, low levels of mechanisation, and poor research and development
activities.
To bridge the demand-supply gap brought about by low
agricultural productivity, the country imports agricultural products such as
wheat, palm oil, etc. In four years (2016-2019), Nigeria's cumulative
agricultural imports stood at N3.3 trillion, four times more than the country's
agricultural exports of N803 billion in the same period.
The country's population growth rate has already
outpaced the rate of food production. According to the United Nations, the
number of people living in Nigeria is expected to more than double by 2050 from
its current level of over 200 million people.
The results of the government's policies to reposition
the agricultural sector have been mixed. The Agricultural Promotion Policy
(APP) introduced by the Federal Ministry of Agriculture and Rural Development
(FMARD) and various intervention programmes by the Central Bank of Nigeria (CBN)
such as the Anchor Borrowers Programme, have led to transformation in the
sector especially in the area of rice production.
However, some of these policies score poorly in the
attainment of self-sufficiency for key agricultural products. For example, annual
wheat production which stands at 0.06 million metrics tonnes is barely able to
cover local demand of over 5 million metrics tonnes despite the APP setting
2018 as the target year in which the nation would have attained
self-sufficiency in wheat production. Wheat dominates Nigeria's agricultural
imports and accounted for about 40.7% (or N390.6 billion) in 2019.
With COVID-19, the challenges hampering the attainment
of food security in Nigeria could deepen. The impact is already being felt in
the form of rising food prices. By April 2020, food inflation had risen to 15%
compared to 14.7% in December 2019. The intra and interstate movement
restrictions could hinder farmers from accessing their farms in other state
locations or procuring inputs such as seedlings and farm implements.
Furthermore, the restrictions may hamper food distribution, which could result
in post-harvest losses, reduced market supply and further increases in food
prices.
Also, export earnings from agribusiness could be
affected in the coming months due to lockdown in countries that import
Nigeria's agricultural produce.
Credit: The post Responding
to the Impact of COVID-19 on Food Security and Agriculture in Nigeria first appeared in PwC Nigeria on June 29, 2020
This report has been republished with the permission
of PwC Nigeria.
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