AN EVALUATION OF NATIONAL FUNDING AND INVESTMENT IN THE AGRICULTURAL SECTOR OF NIGERIA (1970-2008)
ABSTRACT
The research study evaluated National funding and investment in the agricultural sector of Nigeria (1970-2008). Information was gathered from secondary data and analyzed to evaluate fund allocations to Nigerian economic sectors and agriculture from 1970 to 2008, determine difference in budgetary allocations to Nigerian economic sectors and agriculture, examine the effect of National funding and investment in agriculture on agricultural production –GDP and different economic regimes (pre and post SAP) on agriculture GDP rates, identify the implementation constraints to National funding and investment in Nigerian agricultural sector. A simple random sampling was employed to select 2 states’ ADPs from each of the 6 geo-political zones that served as source of constraints analyzed in the study. Time series (secondary) data obtained from CBN and NBS publications were used for analysis. The data collected were analyzed using both descriptive and inferential statistics such as means, percentages, frequency distribution tables and OLS regression model. The major findings were that budget allocations and expenditure to and by the five economic sectors of agriculture, defence, education health, and general administration differed in various years. There were variations in the budget allocations to the economic sectors and an unsteady trend in the percentage allocation to agriculture which was 11.2% in 1970-1975 period, it declined to 7% in 1976-1980, increased to 21.61%(1981-1985), declined to 18.52% in 1986 -1990, peaked 28 % in 2001-2005 and fell to 21.22% in 2006-2008.The study further revealed that the dynamic analysis of the impact of National funding and investment on agricultural GDP is acceptable. Out of the five variables, three (ADP services, fertilizer use, and amount of ACGSF) were positively and significantly correlated to the agriculture share of GDP, while two (irrigation cost and rural roads constructed) were found to have insignificant impact on agriculture share of the GDP. Result also showed that Nigeria economic regimres of SAP had a positive effect on agriculture GDP growth rates as its rate increased from 20.6 % in 1980 to 31.5% in 1990 .Subsequently, it appreciated to 35.8% and 42.1% in 2000 and 2009 respectively. Eleven constraints were identified as hindering the implementation of National funding and investment in agriculture. Most critical constraints were financial, infrastructure, economic, technical, political, social-cultural and environmental in the 6 geo-political zones of Nigeria. The study therefore, recommended that budget allocations to agriculture should be increased to 30% target of NEPAD minimum by legislative act so that agricultural projects will be effectively implemented. Federal government should improve on human capital building on the ADP staff to increase their efficiency and agricultural output. The amount of loan granted by ACGSF to individual farmers should also be stepped-up to help create vibrant agricultural enterprises with employment opportunities to reduce the financial exclusion of the rural poor Nigerians which stunts agricultural growth and development. Federal government should also re-appraise fertilizer local production, local and state government ownership of irrigation projects policy to increase agricultural output by the public-private-partnership strategy. The study further recommends that rural feeder roads should be funded by the three tiers of government to increase rural roads density, access and evacuation of agricultural products which will reduce spoilages thereby increasing agricultural output in Nigeria.