Theme: Optimizing Value Chain in the Agricultural Sector in Nigeria
The Nigerian Economic Society in partnership with the African Development Bank Group organised the 59th Annual Conference of the Society at the NICON Luxury Hotel, Abuja from September 25-27, 2018, with the broad theme: Optimizing Value Chain in the Agricultural Sector in Nigeria.
The Nigerian Economic Society deeply appreciates the African Development Bank’s support and expresses thanks to the amiable President of the Bank, Dr. Akinwumi A. Adesina for believing in the Society and delivering a fruitful partnership.
In attendance were Senior Management and staff of the African Development Bank led by Dr. Celestin Monga, Chief Economist and Vice President for Economic Governance & Knowledge Management (ECVP), the Bank’s Senior Country Director, Dr. Ebrima Faal; top government officials from the Central Bank of Nigeria, Federal Ministry of Budget and National Planning, Federal Capital Territory, Abuja, Senior Management staff of the African Development Bank, representatives of other development partners, fellows and members of the Society among others.
The Conference was declared open by the Vice President of the Federal Republic of Nigeria, Professor Yemi Osinbajo, GCON, who was ably represented by the Special Adviser to the President on Economic Matters, in the office of the Vice President, Dr. Adeyemi Dipeolu. In his key note address, the Vice President enumerated the various efforts of the Federal Government to address the challenges of the agricultural sector. Notable among them is the direct distribution of fertilizers to farmers.
In all, seventy-one papers were presented at the Conference comprising seven in the plenary and sixty-four in the concurrent sessions covering a wide range of topics and issues related to agricultural value chain, technology, financing options and human capital development in the supply chain. On the whole, participants and stakeholders observed that the theme of the Conference was very apt and timely given the urgent need for the country and indeed the African continent to diversify its economy in the enhancement of sustainable economic growth and the very important task of “Feed Africaâ€.
Key observations and recommendations from the Conference include the following:
OBSERVATIONS
I. The Conference noted the overriding need to transform the agricultural sector in Nigeria into a competitive and inclusive agribusiness sector that is capable of reducing extreme poverty, enhancing wealth creation and propelling the country into the top league in agricultural value chains and net exporter of processed agricultural products. The efforts of the Federal Government of Nigeria in this regard were acknowledged.
II. Participants observed that Nigeria’s annual population growth rate currently stands at about 3 per cent and if sustained at this rate, in twenty years, the population would be about 350 million. Since this growing population must be fed, the country must close the yield gap and build a robust agribusiness sector that is sustainable.
III. It was also noted that the agricultural sector has remained largely subsistence, dominated by primary products. This limits the scope for the application of technology, income from exports of agricultural products and achievement of increased positive externalities in the value chain.
IV. The Conference observed that the Nigerian agricultural sector is characterised by low and declining yield, increasing hectarage, low and falling share of global output (with the exception of cassava), large demand and supply gaps and low value addition.
V. The Participants also observed that access to land and credit and difficulties in turning land into capital assets constrain the performance of the agricultural sector, in particular, the smallholder sub-sector.
VI. The Conference noted the need to develop a structured and tenured development plan that is institutionalized in the budget process at the national and sub-national levels for the agricultural sector in Nigeria.
VII. The Conference noted the need to deepen competitiveness, productivity and inclusive growth in the agricultural sector. It also highlighted the need to strengthen the efficiency of the supply chain. These require harnessing efficiently in a well-coordinated manner the robust backward and forward linkages characteristic of the sector.
VIII. The Conference noted that an enabling environment that facilitates access to markets and use of technology to overcome the challenges arising from infrastructural deficits will greatly enhance the performance of the agricultural sector.
RECOMMENDATIONS
Following from the above and other observations, the Conference makes the following recommendations for sustainable growth of the Agricultural sector to enhance the sector’s contribution to the Nigerian economy
1. There is need for a structured and sustainable programme to nurture larger farm holdings with increased application of technology, without crowding out small and medium farm entities. The larger farms would secure technology, markets, storage facilities and serve as off-takers to small farm producers, while the small farm holdings would serving as out-croppers to large businesses. This arrangement will reduce the risk of small farmers and encourage commercial banks to increase credit to small farmers.
2. Government should provide support for research institutes at the national and sub-national levels in enhancing demand driven research. In the short run, competitiveness should be encouraged in multi-stage processing through duty waivers for imported equipment and inputs while in the long run, the production of required inputs and equipment should be domesticated.
3. There is need to adopt a focused and regional integrated commodity approach in the agricultural sector, where priority is given to commodities with comparative and competitive advantage in the agro-ecological zones. Within this framework, a simultaneous approach should be adopted to address inputs supply, production technique, marketing strategy, storage and infrastructure challenges in the value chain.
4. There is need to scale up public budgetary allocation to the agricultural sector to facilitate adequate supplies of improved high-yield seedlings and other high-tech inputs.
5. Quality assurance in the domestic and export supply chain should be institutionalized by the relevant quality assurance agencies of government. This reduces the rate of rejection of the country’s commodity exports by foreign trading partners as well as narrows the wide gap in agricultural production, processing, distribution and sales.
6. Agricultural development plan at the national and sub-national levels that integrate competitiveness and equity in its framework should be institutionalized in the budget process. This plan should be faithfully implemented to transcend different regimes for sustainability.
7. The Conference called for the institution of a governance structure that would enlist the trust, commitment and mutual respect of stakeholders (private sector organizations, organized labour, NGOs and public financial institutions among others) in the value chain, given contemporary world economic realities. In addition, a competent and well remunerated civil service structure is important in actualizing this innovation.
8. National and sub-national governments should revive and fund extension services to facilitate effective and efficient technology transfer from the research institutes and tertiary institutions.
9. There is also the need to have private and public off-takers of agricultural products to encourage productivity. This calls for functional and efficient commodity exchanges.
10. There is the need to have a structured framework for government intervention in the sector when market for agricultural products fails due to environmental externalities. Agricultural insurance can buy off at least some insurable risks in the sector and ensure greater certainty in operational outcomes and returns. Further, this will ensure continued economies of scale in the value chain.
11. There is need for national and sub-national governments to create a platform where supporting institutions in the value chain such as the African Development Bank could synergize with various states, commercial banks or deposit money banks to ensure that lending/credits cascade to the small and rural farmers to boost employment and rural income.
12. The Conference participants noted that while an export-led growth is supported, there is need for some form of protectionist policies given the dynamics of commodity trade.
13. The Conference noted that the country should move away from some entrenched and unproductive traditional, religious and cultural norms and apply superior intelligence, technology and engineering to solve emerging structural and environmental challenges in the agricultural sector.
14. The Conference calls for a greater synergy of fiscal and monetary policies with respect to the agricultural sector to optimize the value chain.
Signed
Prof T. J. Agiobenebo
President, NES
and
Enang Udah (PhD)
Conference Editor
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