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Thursday, 16 April 2015

Impact of Investing in Agriculture, Food and Nutrition Security, Job Creation and Poverty Reduction in Nigeria: Action Aid Perspectives: by Professor P.O. Donli Chairperson Action Aid Nigeria.



                                                   BACKGROUND
As at independence in 1960, the agricultural sector in Nigeria was the most important in terms of contributions to domestic production, employment and foreign exchange earnings.
Agriculture contributed about 90% of the country’s GDP before the discovery of oil in the country.
However, this changed with the discovery of oil which became the principal foreign exchange earner.
With the commencement of oil exploration in the 1970s, agriculture started suffering neglect -reduction in targeted investment in the sector which led to the abandonment of the farms by many farmers and the search for white collar jobs by many young people.
Some of the interventions by the regional, later state governments such as agriculture extension services, agriculture produce boards, etc disappeared or became moribund.

                                                               Interventions:
The impact of this neglect was already becoming glaring as early as the mid 1970s necessitating intervention strategy by the various governments:
The Second National Development Plan (1970 – 1974) which replaced the FNP (whose pivot was infrastructural development) spelt out a more defined approach towards food production as the main nexus of the plan because of the Nigerian civil war which created hardship due mainly to food shortages.
Even then, the real budgetary spending on agriculture was just 7.7% as against 23.1% expenditure on transportation sector alone. 

And at this time, government chose to rely more on food importation rather than address measures to strengthen the capacity base for food production.
1972 – National Accelerated Food Production Project was initiated with a focus of assisting the supply of agricultural inputs and education for farmers. However, it could not achieve its objectives due to poor planning and the untimeliness in the provision of these extension services to farmers.
1975 – Agricultural Development Programme – the failure of NAFPP led to the birth of the ADP. This saw the setting up of 470 agro services centres all over the country to meet the challenges of the extension services provision to farmers that was difficult with the NAFPP. ADPs aimed at enhancing technical and economic efficiencies of small scale farmers
                                                   
Third National Development Plan (1975-1980) is geared towards:

Boosting food production
Lowering of food import dependency
Involved issuance of various types of subsidies & incentives for farmers for boosting food production
The Operation Feed the Nation ( OFN) programme by the military regime of Olusegun Obasanjo in 1976 was an effort at repositioning the nation’s agricultural sector.
Its aim was to increase farmers’ population and crop output as well as people's awareness of the key role played by agriculture in the economy but the visible affluence projected by the oil and gas sector coupled with the culture of corruption that was beginning to emerge made it difficult for the OFN to hit its target.
              
 Fourth National Development Plan
(1981-1985) – this sought to:
Strengthen self-sufficiency in food production via the Green Revolution (GR) era of 1985.  GR was introduced when massive decline in crude oil prices drove the nation (that had become fixated on rent collection from petroleum exploitation) to the brink of an economic disaster”
The Plan ascribed 13.5% budgetary allocations to agricultural sector development (largest share of the plan)
Plan to be achieved through partnership of various agencies – Ministries (Agriculture, Water resources, Labour & Commerce) and River Basin & Rural Development Authorities and ADPs
                                    
                                                             Interventions
The Gen. Ibrahim Babangida Directorate of Food, Roads and Rural Infrastructure (DFFRI) was largely top-down in its implementation, leaving decision-making and fund disbursement to go from the federal level to the state and local levels with certain elements – including funds – getting lost in the translation process.”
While these interventions might have been well-intended they did not quite bail out the country’s agricultural sector.
The River Basin & Rural Development Authorities – aimed at harnessing the potentials of existing water bodies through irrigation services, fishery development and control of flood, water pollution and erosion.
National Special Food Security Programme – aimed at offering a practical vehicle for piloting and eventually extending the application of innovative low-cost approaches both technical and institutional to improving the productivity and sustainability of agricultural system with ultimate objective of contributing to better livelihoods for poor farmers on a sustainable basis
The National Fadama Development Project (Fadama I, II, III and IV) is aimed at addressing some of the factors that militate against the full realization of the potential benefits of agricultural production activities. It is also aimed at increasing the incomes of Fadama users who depend directly or indirectly on Fadama resources through empowering communities to take charge of their own development schedule.

                                                             Recent Efforts
Some efforts have been made in the past few years to address some of the challenges of the sector.
1.       In April 2009, the Federal Government and the Central Bank of Nigeria set up a N200 billion Commercial Agriculture Credit Scheme (CACS) with the publicised objective of enhancing national food security by increasing food supply and effecting lower agricultural produce and product prices among others.
                Agriculture Transformation Agenda (ATA)
The vision of the ATA strategy is to achieve a hunger-free Nigeria through an agricultural sector that drives income growth, accelerates achievement of food and nutritional security, generates employment and transforms Nigeria into a leading player in global food markets to grow wealth for millions of farmers,

                                                                  Challenges
The nation has never been lacking in high sounding agriculture development schemes and policies however there has been challenges:
*wavering policies formulation and implementation
*insufficient infrastructure support
*poor input distribution system
*emphasis on oil economy
*over dependence on rain-fed farming
*environmental degradation
*corruption
*political patronage and
*Poor commitment to implementation of agricultural policies.

A major one is Nigeria’s untapped natural resources & agricultural potentials - As at 1990, 82 million hectares out of Nigeria's total land area of about 91 million hectares were found to be arable, however, just about 30.7 million hectares (76 million acres), or 33% of the land are under cultivation.

Nigeria's diverse climate means that farmers are able to produce virtually all agricultural produce that can be grown in the tropical and semitropical areas of the world. Still she is a food deficit nation, importing large amount of food to feed her ever increasing population in recent years.
                                    
                                 Nigeria’s investment in Agriculture
Although the Nigerian government has increased its attention to agriculture in recent years by introducing a range of policies to increase productivity, yet Nigeria’s budgetary allocations and actual spending on agriculture are woefully inadequate to reduce poverty especially on the key services needed by smallholder farmers. Nigeria spends very little on agriculture; the figures for the states are also low varying from 2.0-5.9%. Not only is spending low – it is also extremely erratic.
A major reason why poverty and food insecurity remain widespread in Nigeria is that successive governments have failed to give appropriate funding to agriculture.
Nigerian government’s recent drive towards private sector investment which focuses on commercial agriculture is unrealistic and will further exacerbate poverty as smallholder farmers are the ones who actually produce 90% of Nigeria’s food.
             
 Figure One: Budget allocation to Agriculture – 2010 – 2014
 




 








                                                                                                                                                                                                                                                                                                                                                                                                                                                        
The chart above shows how the Nigerian government’s budgetary allocations to the sector has continued to nosedive from 3.6% in 2010 to 1.9% in 2011 to 1.66% in 2012, from 1.7% in 2013 to 1.44% in 2014.
These very low allocations have not met the “at least 10% Maputo Declaration Commitment on Agriculture and Food Security” and is an indisputable evidence that the Nigerian government is failing smallholder farmers particularly women, who make up the majority of farmers in Nigeria, and holding back food production leading food insecurity.
The situation is further exacerbated with low quality of spending in general as well as low budget utilization of yearly allocated budgets across States.

                Impact of Agriculture Transformation Agenda
The vision in the Agriculture Transformation Agenda strategy of achieving a hunger-free Nigeria through an agricultural sector that drives income growth, accelerates achievement of food and nutritional security, generates employment and transforms Nigeria into a leading player in global food markets to grow wealth for millions of farmers cannot be realised with the current unacceptably low budgetary allocations and priorities that do not translate to rural poverty reduction.
Hence, Nigerian government should allocate at least 10% of her annual budget to the agricultural sector meeting the Maputo 10% Declaration Commitment on Agriculture and Food Security in Africa.
            
           The Challenge of Food and Nutrition Security in Nigeria
Despite the opportunity offered by nature, the several agriculture development projects, budgets committed to the agriculture and food sector every year, Nigeria is still unable to meet her food production targets.
There is high level of malnutrition among children in rural areas – 56% reported in South West; 84.3% reported in three rural communities in the northern part of Nigeria.
Nationally, the overall prevalence of stunting, wasting and underweight are 42%, 9% and 25% respectively.
                        Food & Nutrition Security
According to a November 2009 study (Akinyele) (IFPRI), “Malnutrition is widespread in the entire country and rural areas are especially vulnerable to chronic food shortages, malnutrition, unbalanced nutrition, erratic food supply, poor quality foods, high food costs, and even total lack of food.”
A survey conducted by IITA between 2001 and 2003 showed that about 18 million households were affected by hunger.  25% of children fewer than five years were underweight while 42% were reported stunted.
Many children as shown in all studies conducted, Action Aid’s inclusive, are malnourished due to poor feeding. Hunger amidst Plenty: Studies on aspects of the food crisis in Nigeria (2009)
                               Food & Nutrition
In the period 1990-1992 for instance, the number of people undernourished was put at 11.8 million and the proportion at 13.3%.
In the period 1996-1997 the figure of the undernourished dropped to 8.9 million and proportion given as 8.7%
However in 2002-2004 the number rose to 11.4 million while the proportion was put at 9.2%.
Even with some of the effort at improving agriculture and food production in the country through the Agriculture Transformation Agenda (ATA), it is almost impossible to meet MDG 1.
According to recent reports, as at 2012, Nigeria had a Global Hunger Index score of 15.7, placing it among countries rated as 'seriously' suffering from hunger with a ranking of 40 out of 79 countries.
                              Action Aid Nigeria
We work with the poor and excluded communities, promoting their rights and empowering people living in poverty to take necessary action to end poverty.

We work to create space for the voices and concerns of people living in poverty to be embedded in government policies and actions.

We maintain strong solidarity with the poor and take sides with them even against all adversity. 

Our core values of gender equality and courage of conviction drive our determination to innovate, take risks, promote women’s leadership and advance sustainable alternatives.

Thus, identifies issues and our perspectives which are in form of policy recommendations below take premise from our stand above.
Current Outlook of Agriculture and Prospect for Poverty Reduction in NigeriaIssues: Low investment.
The strategic importance of agriculture in poverty eradication is highlighted in its position in the MDGs. The MDG 1 is clearly built around halving hunger and poverty with agriculture being central to its achievement.
However, according to the rebased economy 2010 series, the share of agriculture’s contribution of over 40 per cent to the Gross Domestic Product (GDP) has declined to 24 percent. More importantly, and unfortunately too, Nigeria has over the years fallen short of the Maputo Commitment which stipulates 10% allocation of annual national budgets to Agriculture. 

It is also observed that annual allocations to agriculture are insufficient to galvanise growth and development impact intended through ECOWAP/CAADP, the National Agricultural Investment Plan (NAIP) or the current Agricultural Transformation Agenda (ATA).
            Issues around low impact of agriculture on poverty & hunger.
As it is now, management of the agriculture sector in Nigeria is not likely to respond to the situation of poverty in the country unless there is a radical review of policy direction, policy implementation and refocusing of strategy.

Very low cultivation of arable land- According to FAO, Nigeria has 98.3million hectare of land, 74million hectare of which is good for farming; but less than half is being cultivated.
Inefficient harvesting, processing and storage techniques leading to post harvest losses (20 to 40%), and unstable supply.
   Issue – Exclusion & Discrimination against Women in Agriculture (WIA)
Women form about 60-80 % of farmers, but get little assistance from government with restricted access to land due to:
Some legal and cultural barriers that prevent them from owning the land they cultivate in some parts of the country. Around 55 per cent of female-headed households are landless and a further 29 per cent own less than 1 ha.

Limited access to agriculture related services - credit, inputs, training & advice, technology, crop insurance
Government policies have little focus on supporting them.
Inadequate female extension workers – 16%
Only fractions of the agricultural research budgets are targeted specifically at women and, although the government has a number of schemes promoting credit, none, as far as we are aware, specifically target women farmers.

                                        Issue – Land grabbing
Closely linked to this is the perennial problem of land grabbing. This remains the bane of smallholder farmers, especially women, who constitute more than 60 per cent of the smallholder farmers.
Often, they only have small plots of land that are not secure, or have no land at all. The patriarchal system of inheritance in many parts of the country still prevent women from inheriting lands, even the ones on which they cultivate the food the family eat. 
Due to limited yields these women and other smallholder farmers can hardly afford the seeds and fertilizers they need to farm, and in some instances do not have access to water for irrigation. Hunger amidst Plenty: Studies on aspects of the food crisis in Nigeria (2009) Action Aid Nigeria pg 44 – 57.
                                Challenges of Land Grabbing
The challenge of land grabbing in recent years have been worsened by the some states government taking lands from small holder farmers who are into subsistence farming and giving same to foreign farmers who are more into large scale or industrial farming which essentially produces for international market and factory uses rather than domestic consumptions.
    Issues - Poor rural infrastructure
The neglect of rural infrastructure has also contributed in no small measure to the problem of food security. This neglect has affected the profitability of agricultural production, as productivity is restricted owing to low soil fertility in many areas and the inefficient shifting cultivation method, with its devastating ecological consequences. 

Issues of limited access to educational, health, water and agricultural extension services.
The poor conditions of rural roads impede the marketing of agricultural commodities; prevent farmers from selling their produce at reasonable prices, make them vulnerable to exploitation by middlemen; cuts small-scale farmers off from sources of inputs, equipment and new technology. This invariably keeps yields low. 

As a result of this, many able-bodied young people who would have brought fresh energies and knowledge to food production have had to abandon the farmlands and farm settlements, where such exist.

                       Issue - Increasing market power of agro-corporations
This further threatens small farmers, as unfair trade rules, subsidies and food dumping also undermines local agriculture and food security. The opening of the doors to imported food and the porous nature of our borders which in many years has led to increase influx of foreign food items to the country has continued to pose serious threat to food security in the country. While the local production of food has been eroded over a long period, the recent trend of conversion of food for industry use, especially bio-fuel has led to reduction in availability of this cheap food that had literally collapsed some section of the nation’s agriculture sector.

       Issues - Disproportionate interest in large scale commercial agriculture
There is increasing recognition of the benefits of large-scale agriculture, and government’s favour to the formation of cooperative societies and settlements to encourage industrial agriculture. Large-scale food production, however, does not necessarily feed a country. It is the small holder farmers that are feeding the country. The country’s food security therefore depends on them. 

Yet, the federal government has recently set up a N200 billion Commercial Agriculture Credit Scheme (CACS). In spite of this credit scheme and other agricultural development measures earlier mentioned, government funding of agriculture is still estimated as too low by FAO and this invariably has affected the nutritional level of the citizenry, especially the poor. 

                                                     Issue -Climate Change
Nigeria is said to be likely to become one of the most negatively impacted countries in the world by climate change if real measures are not taken to mitigate it. All regions of Nigeria will be impacted particularly the Southern coastal regions (massive flood) and the far North (desertification) and all the main sectors of Nigerian economy especially the agricultural sector.
A preliminary Integrated Assessment Model which assumes minimum adaptation for Nigeria predicts that climate change could result to a loss in GDP of between 6% and 30% by 2050 which worth an estimated N15 Trillion an exchange rate.
                           Issues- Youth Unemployment
54% of Nigerian youths are currently unemployed, with secondary school leavers mostly found among the unemployed rural population. 

The nation’s universities and polytechnics continue to churn out more than 150,000 graduates annually and available jobs remain inadequate to keep pace with the ever-expanding army of jobseekers.
It is projected that the population of young people (75m) is set to double by 2023. A small proportion of this population are involved in agriculture, as more of them are involved or want to be involved in white collar jobs. However, this population is in existence and can be harnessed within the agricultural sector towards massive job creation (2012 National Baseline Youth Survey Report).

Policy Recommendations on strategic agricultural investments – Women Smallholder Farmers
Government investment in agriculture should focus on the following Key Areas Considered Vital for Promoting Agricultural Productivity Gains Leading to Pro-Poor Growth.

Women Smallholder Farmers: Small holder women farmers being the predominant actors in Nigerian agriculture, constituting 60–80% of the agricultural labour force (depending on geographical location) should massively and continually be invested in for job creation and inclusive growth.

     Policy recommendations – Youth in Agriculture & Agricultural Finance
Youth in Agriculture: The population of young people of around 75 million in Nigeria which is set to double by 2023 should be harnessed through deliberate increased investments in youth in agriculture to replace the aging population within the sector towards massive job creation and poverty reduction.

Agricultural Finance: Lack of access to agricultural credit for smallholder farmers in Nigeria especially women continues to be one of the hampering forces against rural agricultural transformation and wealth creation. Cheap agricultural credit should be an instrument of enabling environment for poverty reduction in the agricultural sector, fostering job creation and inclusive growth. Smallholder farmers across Nigeria are yet to start accessing credit through the Nigerian Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) created by the Central Bank of Nigeria (CBN).

Deliberate effort should be made to make NIRSAL accessible to smallholder farmers especially women for job creation and poverty eradication in Nigeria.
                      Policy recommendations – Farm Inputs
Farm Inputs: Improved quality seeds, inorganic fertilizer, organic fertilizer, and agro chemicals, etc, should be made available, accessible and affordable for smallholder farmers. The Growth Enhancement Scheme (GES) has recorded some successes in this area through providing seeds and fertilizer, but a lot still needs to be done in addressing challenges seen within its implementation. The number of bags of fertilizer has to be increased from current two bags to the actual numbers needed by each smallholder farmer. Investments will have to also focus on making available organic fertilizers and agro chemicals.

Policy Recommendations – Extension services & Support to SSAM
Extension Services: With the highly inadequate staffing of extension staff vis-à-vis geographical coverage and farming population with extension agent (EA)-farm family ratio of 1: EA to approximately between 2,500-10,000 farm families depending on the State makes it imperative for considerable investment to be made towards job creation and poverty reduction.

Support to Small Scale Agriculture Machineries: Small scale agricultural production is the fulcrum of the Nigerian agricultural sector and one of the major priority areas of immense investment should be on small scale agricultural machineries for both production and processing towards Nigeria’s attainment of optimal job creation, poverty reduction, and food and nutrition security. Women tailored small scale agricultural machineries should additionally take precedence in the investment. (The Extension Transformation Group (TETG), 2011).
  Policy recommendations – R & D, CRSA & AVC
Research and Development: Research and development investments should strongly concentrate on already existing research results disseminations to smallholder farmers. 
Climate Resilient Sustainable Agriculture (CRSA): With the impact of climate change we are already witnessing in Nigeria, one of the priority area of deliberate agricultural continual investment should also be on Climate Resilient Sustainable Agriculture (CRSA) to support smallholder farmers especially women development of agriculture value chain.

                                              Policy recommendation –
 Responsible Agricultural Investment Principle
Every investment whether public or private must also adhere to Principles for Responsible Agricultural Investment (PRAI).
The seven Principles cover all types of investment in agriculture:

Principle 1: Existing rights to land and associated natural resources are recognized and respected.
Principle 2: Investments do not jeopardize food security but rather strengthen it.
Principle 3: Processes relating to investment in agriculture are transparent, monitored, and ensure accountability by all stakeholders, within a proper business, legal, and regulatory environment. 

                                                                          RAIPs
Principle 4: All those materially affected are consulted, and agreements from consultations are recorded and enforced.
Principle 5: Investors ensure that projects respect the rule of law, reflect industry best practice, are viable economically, and result in durable shared value.
Principle 6: Investments generate desirable social and distributional impacts and do not increase vulnerability.
Principle 7: Environmental impacts of a project are quantified and measures taken to encourage sustainable resource use, while minimizing the risk/magnitude of negative impacts and mitigating them.

                                                                     conclusion
Nigeria is not likely to achieve the MDGs by 2015. As we go into post 2015, priority has to be given again to agriculture and rural development within the framework of poverty eradication and which emphasizes and supports the special roles women have in securing and producing food in Africa.

Nigeria still has the potentials to be food-secure and ATA is a step in the right direction.
The laudable vision in the ATA strategy of achieving a hunger-free Nigeria through an agricultural sector that drives income growth, accelerates achievement of food and nutritional security, generates employment and transforms Nigeria into a leading player in global food markets to grow wealth for millions of farmers seems a mirage in view of the current unacceptably low budgetary allocations and priorities that do not translate to rural poverty reduction.

Hence, Nigeria must allocate at least 10% of her annual budget as per the Maputo 10% Declaration Commitment on Agriculture and Food Security in Africa.
Nigeria still has the potentials to be food-secure but this can only be achieved through: 

*rural development
*provision of easy access to basic farm inputs
*adequate budgetary allocations to agriculture particularly to the food crop sub-sector,
*enunciation of appropriate policies for food crop sub-sector
*political stability – peace and human security
*reduction in rural poverty and
*Peasant farmers education.

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