According to the recently published Q1-1 9 GDP report, Agriculture sector recorded its highest growth rate in the last four quarters, increasing by 3.1 7% y/y as against the average growth rate of 2.1 4% over the last four quarters. The sustained improvement in the sector can be tied to the resultant effect of several support facilities as well a s other efforts by the current administration to resolve the crisis between herders and farmers.
However, the major challenges facing the sector relates to the protracted failure to harness the potential inherent in the sector even after the recent issues have been fully resolved. For instance, a major impediment to growth in the sector is the huge infrastructure gap and logistics issues, which makes local production less competitive. Thus, this is incentivizing activities of smugglers amid a reduction in global commodity prices.
Certainly, beyond financial interventions, driving output growth in the Agric sector above the 3% threshold requires removing impediments such as poor infrastructural development which continue to mount pressure on cost. A massive investment in rural infrastructures such as road networks and storage facilities for the processing of farm produce will ease the cost.
Furthermore, to boost output level beyond domestic subsistence production, Nigeria must commercialize agriculture and invest in research & development, to increase crop yield and reactivate Agric export earnings.
United Capital Research