Nigeria, with over 180 million people, has the largest population in Africa and accounts for 47 percent of West Africa’s total population (World Bank 2012). Also, Nigeria had the largest economy in Africa with a GDP of $569 billion and a foreign direct investment of $3,064,170,000 in 2015. Interestingly, Nigerian Agriculture sector has played a major role in contributing to the economy of the nation, employing approximately two-thirds of the country’s total labor force and contributing 40 percent to Nigeria’s GDP (IFAD 2012).
Unfortunately, the country has never fully utilized her resources neither has it exhausted her production capacity in terms of cultivable land that are available. Despite an estimated 71 million hectares of cultivable land, only a small fragment is currently used for farming as a result of lack of capital for expansion and inaccessible to the international market. In addition, many of our foods are still being produced by the small-scale farmers, who live in the rural communities and depend largely on rain-fed farming.
This skewed preference to small-scale farming owes mainly as a result of resource inadequacy plaguing the industry especially in the area of agricultural financing and investments. Besides, lack of infrastructures such as roads, preservation technology (appropriate technology) and services systems such as effective Agro products supply chain, efficient extension services further encourages small-scale farming especially in the rural areas thereby isolating rural farmers from needed inputs and profitable markets.
In spite of these challenges bedeviling this sector, the government of Nigeria in recent times after years of relative neglect began to reform and focus on the agriculture sector. To jump-start the sector, the government implemented a new strategy known as Agricultural Transformation Agenda (ATA) between 2011 and 2016. The focus was on rebuilding a sector whose relevance, output and capacity had shrunk dramatically.
This intervention served its core purpose of helping refocus Nigeria’s attention to Agriculture and its value chain. ATA, despite its success, Nigeria still imports a significant quantity of food. Also, another challenge was that Nigeria was not earning substantial foreign exchange from agriculture, thus, losing on both ends. Therefore, the Nigerian government came up with a refreshed strategy coined the Agricultural Promotion Policy (APP). The purpose of this new policy is to provide a disciplined approach to building an agribusiness ecosystem that will solve these 2 gaps (that is, foreign exchange and importation).
This policy was hinged on private-driven initiatives while the government facilitates, as well as provides supporting infrastructure, systems, control processes, and oversight. As in most developed economies, the private sector is strategically positioned to complement the efforts of the government and expected to be the major driver of the agriculture sector by fully maximizing and consolidate on the favorable policies and business climate created by the government.
The success of the new policy would be driven by the levels of engagement of marketplace participants, farmers, states, investors, financial institutions, and communities. Other stakeholders from research laboratories to the Nigeria Customs Service to donors would also play vital roles. Performance would be tracked and published periodically to assist inform smart decision making, but also to reinforce the fundamental goal of leveraging the capabilities of Nigeria to ensure food and income security (Federal Ministry of Agriculture and Rural Development, 2016).
In conclusion, this is a great and viable opportunity especially for food processing and manufacturing companies that are interested in investing in Nigerian agribusiness on a large scale as the business climate becomes clearer and better as more stakeholders are fully involved in the sector.