ABSTRACT
In recent decades, the main and potential contribution of agriculture to economic growth has been a subject of much controversy among development economists. As some contend that agricultural development is a pre-condition for industrialization, others strongly object it and argue for a different path. This study tries to look at the drivers of Agricultural development and its economic effect in Nigeria from 1970-2015 which will enable us proffer solution to Agricultural development in the economy since it is an important component of any economic growth of any country. Taking advantage of ordinary least square method (OLS), the research carried out by means of secondary data and using the independent variables, Improved Agricultural Inputs (IAI), Real Exchange Rate (REXR), Real Interest Rate (RINTR) Government Expenditure in Agriculture (GEA) and Total credit to the Agricultural sector (ACCESS) to re-examine the question of whether agriculture could serve as an engine of Economic growth in Nigeria. The result gotten from the empirical analysis shows that the productivity in agricultural sector has appreciably affected positively on the economic growth in Nigeria.
CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
Agriculture is said to be the foundation and bedrock upon which the development of stable human community has depended on throughout the whole universe such as rural and urban communities.
Agriculture is the cultivation of land, raising and rearing of animals for the purpose of production of food for man, animals and industries. It involves and comprises of crop production, livestock and forestry, fishery, processing and marketing of those agricultural production. The studyof the history of economics provides us with ample evidence that agricultural revolution is a fundamental pre- condition for economic development.
The agricultural sector has the potentials to be the industrial and economic springboard from which a country’s development can take off.
Indeed, more often than not, agricultural activities are usually concentrated in the less developed rural areas where there is a need for rural transformation, redistribution, poverty alleviation and socio-economic development.
Production is only complete when it gets to the final consumers. To this end, the role of agriculture in transforming both the social and economic framework of an economy cannot be over- emphasized (Simon kuznet 1966).
According to Jerzy W. (2013), agriculture is that kind of activity which joins labour, land or soil, live animals, plants, solar energy and so on; the Minister of Agriculture is the Minister of the beginning of life. So people who are involved with that kind of activity are involved in something special. In recognition of this prominent role the Minister of Agriculture and Federal Government of Nigeria has taken a giant stride to treat agriculture as serious political, economic and investment issue in Nigeria.
It is also a source of food and raw materials for the industrial sector; it is also essential for expansion of employment opportunity, for reduction of poverty and improvement of income distribution, also for speeding up industrialization and easing the pressure on balance of payment. In effect, it has been the source of gainful employment from which the nation can feed its teeming population, providing the nation’s industries with local raw materials and as a reliable source of government revenue.
The development of agriculture in Nigeria has been slow in spite of the various agricultural policies. In fact, the government recognized the unhealthy condition of Nigerian agricultural sector since 1970, and has formulated and introduced a number of programmes and strategies aimed at remedying this situation. These measures included the setting up of large-scale mechanized farms by state and federal government, introduction of scheme such as the River Basin Development Authority.
AgriculturalCredit Scheme was introduced by successive government (Omobowale 2009).
In spiteof these measures, the development of the agricultural sector has been slow and its effects on economic growth and development have been minimal.
In Nigeria, economic growth has largely been accounted for by resilient agricultural growth. According to the Nigeria vision 2020 first implementation plan for the period 2010-2013, the agricultural sector contributed 73%of GDP growth over the period 1999-2009. With real growth averaging about 70%per annum from 2004-2008 and value added to the tune of 42%of the gross domestic product (GDP) within the same period, the agricultural sector in Nigeria clearly stands out as the most dominant and leading component of economic growth (CBN Annual Report and financial statements2008).
Agricultural growth is associated with performance in four constituent sub-sectors: crops, livestock, fisheries, and forestry.
The crop sub- sector had an average the largest share of growth, followed by livestock, forestry and the fishery sector which grew substantially in the post 1974 period.
Among all these, the crops subsector overall remains the dominant agricultural economy of Nigeria. Accordingly, the growth performance of the agriculture sector has been largely driven by the performance of the crop sub-sector.
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