With unemployment rate on a steady rise due to the loss of jobs arising from failures of businesses among others, experts say agriculture may just be the silver bullet; BENJAMIN UMUTEME writes
Before oil was discovered in Oloibiri in the present Bayelsa state in 1956, the Nigerian economy was largely agrarian, with a major part of revenue coming from the export of cash crops. But today, the story is different as an almost comatose real sector coupled with infrastructure deficiency and other factors put together has shot up the country’s unemployment levels.
With the discovery of oil leading to a shift from an agriculture-run economy to an economy that is heavily reliant on revenues from oil and gas, there was a time when Nigeria exported cash crops like palm produce (oil and Kernel), cocoa, rubber, timber, groundnut which was the mainstay of the economy.
In spite of fluctuations in world prices, agriculture contributed about 65 per cent to QDP and represented almost 70 per cent of total exports. Agriculture provided the foreign exchange that was utilised in importing raw materials and capital goods.
Before independence in 1960, the economy was characterised by the dominance of exports and commercial activities. There was no viable industrial sector.
Raw materials, comprising agricultural produce and minerals were exported to the industrialised nations. The industrial sector continued on the pioneer industries schemes as Import Substitution Industrialisation (ISI) strategy was adopted. Consequently, various consumer items, which were hitherto imported, were produced domestically. Protective measures like tariffs, quotas were in place to ensure that domestic industries were allowed to grow.
In the short run, jobs were created, although the industries were to some extent unnecessarily protected by government.
Then, the country was number one globally in palm oil exports, well ahead of Malaysia and Indonesia, and exported 47 per cent of all groundnuts, putting it ahead of the USA and Argentina.
But its status as an agricultural powerhouse has declined steeply. 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. And while the country produces 65 percent of tomatoes in West Africa, it is now the largest importer of tomato paste.
Nigeria’s intractable unemployment crisis
Nigeria’s unemployment crisis did not start over night, it was helped by successive administrations inability to invest in the development of its infrastructure. While monies were budgeted for capital projected, they were either not released for the purposed intended or they were released to private pockets, the implication was not only abandoned projects shattered all over the country. This, in turn affected the power sector and many other critical sectors with the end result of people losing their jobs as many factories could no longer continue to power their factories.
Nigeria faces a seemingly intractable unemployment crisis following a clear absence of sound job creation strategies by successive administrations. Presently, the country’s unemployment rate stands at 23.1 or 20.9 per cent, according to data from the National Bureau of statistics (NBS) in its Labour Statistics Report for the third quarter of 2018, there are fears that the figure might rise to 33.5 per cent.
Of the 20.9 million persons classified as unemployed as at Q3 2018 11.1 million did some form of work but for too few hours a week (under 20 hours) to be officially classified as employed while 9.7 million did absolutely nothing, the NBS said.
“Of the 9.7 million unemployed that did absolutely nothing as at Q3 2018, 90.1 per cent of them or 8.77 million were reported to be unemployed and doing nothing because they were first time job seekers and have never worked before.
“On the other hand, 9.9 million 0r 0.9 per cent of the 9.7 million that were unemployed and doing nothing at all reported they were unemployed and did nothing at all because they were previously employed but lost their jobs at some point in the past which is why they were unemployed.
“Of the 9.7 million that were unemployed and did nothing at all, 35.0% or 3.4 million have been unemployed and did nothing at all for less than a year, 17.2% or 1.6 million for a year, 15.7 per cent or 1.5 million had been unemployed and did nothing for two years, and the remaining 32.1 per cent or 3.1 million unemployed persons had been unemployed doing nothing for 3 and above years,” according to the NBS.
This is apart from those that are termed as under employed. According to the report, the total number of people underemployment increased to 18.02 million in Q3 2017 and to 18.21 million in Q3 2018. This brings the number of those that are either unemployed or under employed to 39.1 million.
Neglect of agric hurts
When Nigeria jettisoned the agric sector after the discovery of oil, it soon dawned on the authorities after the economic crisis of the 1970s that there was need to revive the sector so that it can once more take its rightful place as a revenue earner for the country.
Thus the General Olusegun Obasanjo led military junta introduced the ‘operation feed the nation’ and later when Shehu Shagari was sworn in as president in 1979, he thought to build on the Obasanjo legacy as he initiated the Green Revolution. But, again, it could not stand the test of time as it was concerned to the basket of history as the military regime of Muhammadu Buhari, did not continue with the programme.
With the return to civil rule in 1999, President Obasanjo tried to return the country to the part of diversifying its revenue by investing in the agric sector, but like previous administration the will to drive the process was lacking.
However, it was during the time of President Goodluck Jonathan’s administration that the agric sector was given prominence with the Agric Transformation Agenda.
The administration went further to appoint Dr. Akinwummi Adesina, who was doing a great job at Agra Africa, as Minister of Agriculture to drive the transformation in the sector. Adesina had lamented the country’s deteriorating agriculture sector. According to him, “Nigeria is known for nothing else than oil and it is so sad, because we never used to have oil – all we used to have was agriculture.”
“Nigeria’s oil has come at the detriment of the agriculture sector and that is why we had a rising poverty situation. We were having growth but without robust growth able to impact millions of people because it is not connecting to agriculture.”
His efforts not enough
When this administration came to power, it was clear that they needed to explore other sources of revenue to address the challenges that were mounting by the day. This led to several initiatives, but the one that had moved people out of poverty is the Anchor Borrowers programme of the Central Bank of Nigeria. It has also created jobs, with farmers smiling to the bank after each harvest season.
Transforming Nigeria’s agric value-chain
From 1970 to late 2000s, the agric sector’s contribution to GDP and export earnings steadily declined due to continued focus on petroleum exploration. Over the past five years, the sector has contributed an average of 23.5 per cent to GDP and generated 5.1 per cent of export earnings.
The recent fall in crude oil prices that led to recession has triggered the need for the government to seriously address the role of agriculture in economic diversification.
Experts are optimistic that agriculture can solve the current unemployment challenge that Nigeria is currently undergoing.
According to the deputy director-general in charge of Partnerships for Delivery at the International Institute for Tropical Agriculture, Ibadan, Oyo state, Dr Kenton Dashiell, agriculture can go a long way to address the unemployment problem.
He said, “I’m 100 per cent convinced that it’s going to happen for sure. What I am not sure about is how fast it will happen. People are working day and night to make this move fast and the truth is it must be fast; it cannot be slowed down because if it is, youths would look for other ways to survive and unfortunately it might lead them to the wrong path.”
While engagement in farming practice has not been in doubt, the challenge has always been the addition of value to the agric products we have at the moment.
As many continue to harp on the need to transform our agricultural value-chain, the government is yet to take in the message as farm produce continue to rot away or are disposed off cheaply by farmers so that their labour will not be in vain.
As it stands, the country’s agriculture sector requires massive investments to increase production and to create value addition across the most profitable segments of the value chain.
Until that is done, solving unemployment with farming will still be a herculean task.
