Trajectory Of Agribusiness In Nigeria

By Titus O. Olowokere –

Nigeria, the most populous country in Africa, with the largest economy in the continent- in close competition with South Africa – and a population of 180 million people, has a firm position among the top 30 economies in the world based on GDP volume. Nigeria is the largest country, largest market and most sought business destination on the continent of Africa. Here lies the strength; it is sixth biggest country in the world by population, and it is projected to be the third biggest country in the world by 2050. However, this has been on very delicate economic fabric; the statistics show clearly that the Nigerian economy currently is dominated by crude oil. Nigeria economy depends largely on importation, consumes what It does not produce and rely solely on the sale of one product, crude oil.

How did we get here? Available records show that in 1960, Agriculture contributed 54.7 % to Gross Domestic Product (GDP). In the mid-sixties, export crops were the country’s main foreign exchange earner. The country was number one globally in palm oil exports, well ahead of Malaysia and Indonesia, and exported 47 percent of all groundnuts, putting it ahead of the US and Argentina. While Nigeria once provided 18 percent of the global production of cocoa, second in the world in the 1960s, that figure is now down to 8 percent. Now, even though 70% of the world’s cocoa beans come from four West African countries, Côte d’Ivoire is the world top producer with 30 percent of the world’s total cocoa, leading the rest of the world by over half a million metric tons, putting Nigeria as the 4th largest cocoa producer.

What changed? After Nigeria gained independence, focus shifted from Agriculture to crude oil and gas. Over 95% of foreign exchange earnings come from export of crude oil and less than 1% from the manufacturing sector. This is reverse trend with Cote D’Ivoire, where companies like Nestle and Cadbury receive much of their cocoa from, and Cocoa alone is responsible for almost two-thirds of the trade revenue coming into the nation. While Nigeria used produce 65 percent of tomatoes in west Africa, it is now the largest importer of tomato paste.

The country depends on oil revenues and is therefore very vulnerable to variation in crude oil prices and production level. Now with indeterminate continuity of oil reserves, with oil fortunes dwindling, with source of energy shifting from fossil fuel to alternative energy sources, the need for paradigm shift cannot be over-emphasized. Agriculture is the future of economic growth in Nigeria.

Nigeria is blessed with 84 million hectares of arable land, 60% of which is currently uncultivated. Nigerian agriculture has potential, which must be transformed into food supply to deliver nutritious food and wealth to our growing population. Ability to recognize and maximize this potential is a sure path to the availability of safe, sufficient and nutritious food for Africa.

We can grow the size of the agricultural sector from the present level of $90 billion per year today to even S500 billion per year by 2050. Nigeria has no business being a food importing country. With vast water resources. abundant land and cheap labor, we should be feeding the world. But we are not. Agricultural industrialization IS the key for economic recovery and prosperity for the country. Our vast lands should be cultivated, water should be well managed to produce more grains per drop. our labor enhanced with mechanization. and everything produced should be processed. The labor of our farmers must be turned into wealth. Nigeria should not manage poverty in agriculture. Nigeria must create wealth from agriculture. There must be renewed focus on growing the non-oil sector of the economy with emphasis on agribusiness sector and food value chain, “from farm to fork”, commencing with the primary producer and moving through to the retailer and end-consumer.

Even though oil is currently the largest source of foreign exchange earnings in Nigeria, agriculture remains the base of the Nigerian economy, providing the main source of livelihood for most Nigerians. Agriculture is the largest sector of the Nigerian economy and employs two-thirds of the entire labor force.The sector is a lifeline— 65% of poor working adults relied on agriculture for their livelihoods in 2016. It also represents an opportunity for job creation and shared prosperity. Overall, food and agribusiness sector isglobally over US$ 5 trillion industry that represents 10 percent of global consumer spending.

Nigerian farmers and agribusinesses could even create a trillion-dollar food market by 2050 if they can expand their access to more capital, electricity, better technology and irrigated land to grow high-value nutritious foods. Improving Nigeria’s agribusiness sector means higher incomes and more jobs. It also allows Nigeria to compete globally

Yes, the world is a global village, thus, Nigeria cannot and must not do it alone. We need to learn from what the developed countries have done, and how they got to where they are now. For instance, the U.S. economy remains the largest in the world in terms of nominal GDP. The $19.42 trillion U.S. economy is 25% of the gross world product, according to investopedia. Agribusiness is a critical fulcrum of the United States economy. It is the largest industry in the state of Georgia, contributing more than $71 billion to the state’s economy, with 1 in 7 Georgians working in agriculture, forestry or related fields. It provides an excellent model for development of Nigerian Agro-allied business.

Annually, a couple of agribusiness summits are held in the United States. These provide lucrative opportunities for partnership, collaboration, technology transfer and knowledge sharing.The U.S.-Nigeria agribusiness investment Summit & Expoheld annually in Atlanta, GA, for instance, gives participants valuable opportunity to meet buyers, investors, key decision makers and agricultural officials from United States of America and Nigeria. Participants can discover global agriculture funding options available in US to farming projects, learn from the more advanced Agro-biotechnologies and data-driven, modern, large-scale farming solutions in USA, exhibit our export agro-products, acquire fresh ideas that can help improve agribusiness during the seminars, conferences and networking sessions. They are also able to network with agribusiness leaders, experts and scholars who are transforming the US agricultural. With exhibitors and attendees from several locations in attendance, the summit will explore new business opportunities across Nigeria’s diverse agricultural, farming & processing sectors.

Nigeria does not need to re-invent the wheel in the space of agriculture. It makes sense to “hitch our wagon to a star”. Nigeria, indeed, can achieve sustenance in agriculture, yes, we can.

—-Titus Olowokere is the President / CEO of the U.S.-Nigeria Trade Council, USA.