The Agricultural Sector during the Babangida Administration


Abdullahi Labo

Introduction

A major sector of the Nigerian economy that has posed and continue to pose tremendous challenge to succeeding administrations in the country is agriculture. Beginning from the colonial period when agriculture provided totally, for the needs and requirements of the government and people of Nigeria to the present, when non-agricultural commodities sustains the country, no other sector has received the kind of attention agriculture had received. This is so because of the fact that it is in this sector that between 60 – 70 percent of the population is employed.’ Thus, even a minute impact on agriculture is bound to be felt by a vast majority of Nigerians. The Babangida administration therefore is simply one of the several administrations in the country that was faced with the imperative of having to wrestle with the problems embedded in the agricultural sector.

The major objectives and policy focus of Nigeria agriculture as contained in several official documents and publications are centered on governmental commitment to accelerate growth of the sector in: ensuring food supply in adequate quantity and quality to keep pace with increased population and urbanization; expanding production of export crops with a view to increasing and further diversifying the country’s foreign exchange earnings; promoting the production of agricultural raw materials for domestic manufacturing activities; and evolving appropriate institutional and administrative apparatus to facilitate a smooth integrated development of agricultural potentials in the country.

Thus, from 1900 upward, demand for food increased sharply especially in the Northern protectorate. By the late 1950s, Katsina was reportedly importing 20,000 tonnes of cereals. Zaria Province was also a net importer of grains before 1949 as M. G. Smith observed in his study. At household level storage of enough foodstuffs as security against drought became impossible. Even before then the 1929-1939 Great Depression took its toll on farmers as agricultural commodity prices came crashing. For example, the price of groundnuts fell by 40% between 1928 and 1931. In the attempt to stabilize their income, peasant farmers expanded their export production from 135000 tonnes in 1928 – 29 to almost 200,000 tonnes between 1932 and 1933. In this regard, the farming population continued to swim in indebtedness, heavy taxation and inadequate food supply. The merchant companies equally became affected by declining profit.

It was in the context of this situation that the government established the commodity marketing boards in 1947 on grounds of price stabilization and reduced middlemen extortion. However, because agriculture represented the principal economic activity in the country, these boards became the wealthiest and economically most significant agencies. Government also accumulated massive revenue from the operation of these boards. For example, between 1947 and 1954, approximately $25 million was generated from this source.’ In a study conducted by Olatunbosun and Olayide on these boards, it was discovered that their pricing policies- had generated decreased production, inefficient diversification of farming, growth of absentee landlords and lack of access to formal sources of credit.

The colonial period thus, came and ended with agriculture very much in turmoil. Export crop production remained the bedrock of the sector with little or no investment to inject new life into it.

Thus, post-colonial agricultural policies in Nigeria were initiated in the context of regular five-year development plans with export crop production remaining the corner stone of economic activity in the country. For example, at independence in 1960 income from agriculture constituted 63.4 percent of the Gross Domestic Product. However, with fragile political situation and rapid declining in the prices of export crops, Nigeria began to experience severe fiscal crisis. The contribution of the agrarian sector to the economy also began to slow down rapidly. By 1971, its contribution to the GDP dropped to 36 percent. The emerging petroleum sector thus became the focal point of revenue derivation.

To rectify the agrarian situation in the country, government began a policy of direct involvement in production. The farm settlement schemes of the early 1960s were the pioneering programs in this respect. With the collapse of these schemes, government moved its policy in the direction of promoting private enterprise in agriculture with the belief that modern agriculture is the best way to resolve the crisis facing the food and agricultural sector of the nation’s economy. Thus, backed by massive revenue acquired through oil exports, it launched a Multi Million Naira Third National Development Plan (1975 – 80). During this period, government initiated a series of capital intensive agricultural programs such as the Agricultural Development Projects (ADPs) with the assistance of the World Bank in 1975; River Basin Development Authorities (RBDAs) in 1976; Operation Feed the Nation also in 1976 and the Green Revolution in 1980.

These programs came up with several kinds of incentives to assist both new entrepreneurs and the small farmers to enhance production. These include tax reliefs, less import duty on agricultural machinery, continued subsidy on fertilizer etc. This was accompanied with the re-shaping of the land tenure system in 1978 with the promulgation of the Land Use Decree. Government also established food companies such as the National Grains Production Company (NGPC), the National Livestock Production Company (NLPC) and- the National Root Crop Production Company (NRCPC). These companies were responsible for accelerating production through large scale mechanized farm units. The Nigerian Agricultural and Cooperative Board (NACB) established in 1973 was given boost with more funds to assist both large and small-scale farmers to enhance their production.

However, inspite of all these policies and incentives, the food and agriculture situation continued in its downward trend. This downward trend has been attributed to a number of factors ranging from neglect especially with the coming of petroleum to bad policies as argued by the proponents of structural adjustment. Thus, internal demand for food especially rice, wheat flour, milk, etc. went up. And in the absence of a viable source to meet this increasing demand for food various governments resorted to food importation. By 1981, the food import bill had risen to over two billion naira. “‘Correspondingly, food prices continued to escalate. By 1983, a bag of rice imported at the cost of N416.00 sold for N460.00 in the market. Infact, the inability of the Shagari Administration to handle this situation was partly responsible for the New Year eve military coup.

The Thrust of the Babangida Regime in Agriculture

It is quite clear from the foregoing that the Babangida administration came to power in Au rust 1985 and met Nigeria’s agriculture in need of help. Decades of chaotic policies have served to bleed the sector to a virtual comatose position. Thus, as part of its National Economic Recovery Program the new government and its 1986 Budget came up with an ambition line-up of programs to revitalize the agrarian sector. Such programs were intended to pursue the course of gated drive towards self-sufficiency in basic food items including rehabilitation of the cash crop sub-sector to reduce import dependency, expand domestic production and provide raw materials for agro allied industries.

The Directorate of Foods, Roads, and Rural Infrastructures (DFRRI) was also established for the purpose of rehabilitating various categories of roads in the country and especially for the development of a national network of rural and feeder roads, in order to strengthen the massive effort for food and agricultural self-sufficiency in the shortest possible time.

Subsequent national policies on food and agriculture by the administration in the rest of the 1980’s were deeply coloured in compliance with its overall tilt towards structural adjustment. Government in this respect, de-emphasized the previous path of delivering into direct production and marketing of agricultural products. Its role rather, remained facilitatory through making of grants as well as establishing programs aimed at ensuring improved production and supply of food and raw materials. Henceforth, food imports were banned except where necessary to help in boosting local production. Thus, from 1987 the government clearly stated its policies along this line. For example, from this year (1987) it pointed out that henceforth, it was privatising fertilizer procurement and distribution to enhance distribution efficiency and make fertilizer available to local farmers.

To boost farmers capacity for access to inputs and other agricultural services, the National Small Farmers Credit Program was launched to bring seasonal credit to farmers at grassroots level. During the same year, Federal Agriculture Ministry was directed to put more effort in developing a Food Market Information and Dissemination Service. The objective was to give the Nigerian Food System with routine information on interventions and stocks, market trends, and future prices for basic staples.

However, even though the 1990s began with increases in agricultural production and improved performance in the sector contribution to the GDP, the impact of Structural Adjustment has led to high increases in food prices. The 1990 policy on Food and Agriculture therefore, was initiated with the aim of rectifying- this problem. The programs; therefore, became focused in the direction of accelerated production of those staples that constitute the food diet of ordinary low-income groups in the country. Program strengthening was therefore initiated in three areas during 1990: consolidation of rural road program with DFRRI given top most priority to areas that produce the bulk of the country’s staple food items; launching of National Commodity Program for accelerated domestic production, processing and distribution of food stuffs and fiber and transforming procurement and distribution of agricultural inputs especially fertilizer from public to private sector in line with the government’s structural adjustment policy.

By the beginning of 1991, the government itself admitted encountering problems in its agricultural sector which it attributed to drought, activities of smugglers, inaccessible rural roads and failure of inputs to reach farmers when needed. Thus, during 1991, government established the National Agricultural Land Development Authority (NALDA) with the assignment to address the chronic problem of inadequate levels of agricultural land, labour resources utilisation coupled with high cost of land development. Community Bank system was also encouraged with government giving priority to applications for their establishment in areas with greater agricultural potential. Besides, in order to boost the National Food Security and Storage System established in 1987, the government launched a new program in 1991, of small and medium scale storage facilities situated in local government areas considered to be of high agricultural potential.

The objectives and cardinal focus of the regime continued in the same direction as in previous years in 1992. From this time however, government agricultural policy came to be located in the context of the 1992 – 1994 Rolling Plan. The key areas of priority in the agricultural sector during this period included the National Accelerated Food Production Program; Industrial Crop Production; Farm input and infrastructure development.

At the level of funding agriculture, government during this administration followed the footsteps of previous regimes in providing less percentage of budgetary allocation to agriculture compared with other sectors such as Defence, the FCT and so on. However, there was a consistent growth of budgetary allocation in terms of naira during the Babangida regime as shown below. (See Table in Appendix C)

Overall, one could say that there were obvious signs of enthusiasm to intervene in the agricultural sector by the regime as manifested by a series of policies that were initiated. The Babangida administration never hesitated in this respect.            From its inception in August 198 to its exit in August 1993, not less than 30 new policy actions were put in place with the stated objectives of accelerated production of food and raw materials, marketing, rural roads, agricultural land development, credit, strategic reserves, fertilizers and fadama development. e.t.c.

Areas of Performance

To evaluate and project the actual performance of any administration in agriculture has not been easy. This is largely because of the inconsistencies embedded in the statistics provided by the various agencies undertaking this task.

With regard to the Babangida administration, evaluation of its performance has been mixed with divergences emanating from support or lack of it, of the regime’s structural adjustment program. However, both official and non-official reports have indicated a significant growth of 4 percent and above from 1985 through 1995. The World Bank for example, is of the view that prior to adjustment, agricultural production was stagnant due to low producer prices, restrictions on marketing and drought in the 1980s. However, with adjustment occasioned by the naira real depreciation, elimination of marketing boards and trade liberalisation has had a positive effect on cash crops. Thus, beginning from the mid – 1980s, according to the bank, agricultural production expanded with the sector’s real value added getting increased by more than 25 percent between 1986 and 1992.This meant an average annual growth rate (with significant differences across sub-sectors) of 3.8 percent.

Data gathered from the Central Bank of Nigeria and the Nigerian Institute for Social and Economic Research have supported the World Bank claims of improved Agricultural production in the country as shown by the (table in Appendix C).

It can be seen from this table for example that cocoa production by 1990 has increased by almost 100,000 tonnes. Even though production fell after 1989, previous success was attributed to improved case of existing stock, reduction in smuggling and unrecorded exports, In the food sector, cassava production showed the largest increase from an average of 923,000 tonnes to 2,390,000 tonnes in 1986 through 1989. Maize production in the country grew from an average of 902,000 tonnes in the early 1980s to 1,311,500 tonnes between 1986-89 reaching even higher levels in 1991-92, with production more than 300 percent the 1986 level.

In its own assessment, the Food and Agriculture Organisation of the United Nations reported that: From a Food-deficit situation of the late 1970s and early 1980s, Nigerian agriculture has recorded significant improvement in food production. An average annual growth rate of 4.1 % has been recorded between 1986 and 1995 with the overall level of domestic food self-sufficiency rising from 81% in 1981 to 94% in 1995. “

However, even though the World Bank attributed this success to be the result of the government’s Structural Adjustment Program, the Federal Agricultural Coordinating Unit (FACU) largely attributed these growth rates to the ADPs system in their effort towards food production in the country.” The ADPs supply of fertilizers to farmers increased at an average rate of 34.23% i.e from about 301,000 metric tonnes in 1985 to about 1,472,000 metric tonnes in 1990. Seed multiplication hectarage rose by an average of 83.7% per annum between 1986 and 1990. Total length of roads rehabilitated through ADPs efforts between 1986 and 1989 also increased at an annual rate of 9.4%. This obtained in addition to rural roads development as well as construction of boreholes, well sinking and Fadama Irrigation. “

This trend in expansion of production was manifested in addition, at the level of livestock development. It was reported for instance that cattle needs grew from 5.14 million in 1991 to 16.316 million in 1993. Similarly, the population of sheep rose from 13 million in 1991 to 14 million in 1993, while goat increased from 23.5 million to 24.5 million during the same period.

However, one area that has received severe bashing was the Structural Adjustment Program in Agriculture, initiated by the administration in 1986. SAP, it has been argued, almost killed agriculture especially the food sector. This is because farmers over the period had to purchase inputs at outrageous prices without a corresponding increase in product prices matching the input price increase. Thus, many farmers were forced to switch from food production to export crop production with dangerous implications on food security. Besides, fertilizer shortages in the country continued to manifest itself. Minimum annual fertilizer demand in the country, put conservatively at 2 million metric tonnes was not achieved. Food prices during the tenure of the administration have been high with consumer price index on food going above that of other consumer items with severe implications on the low income groups and the country’s food security in general. Even the funding of agriculture has come under criticisms as the Babangida administration, just like the administrations before it, gave agriculture less than it deserved in budgetary allocations. For example, during the 1990 – 92 Rolling Plan, the Federal Ministry of Agriculture received N1, 054,000 while the ministry of Defense received a special allocation of 142,380,311.

Conclusion

This paper set out to assess the intervention of the Babangida administration in agriculture. It pointed out that the regime came to power when agriculture was in crisis. In this regard, its interventions to rectify the situation have yielded fruit at different times helping to improve productivity. Criticisms that accompanied the regimes intervention in agriculture are valid, requiring that future administrations learn from the mistakes and inabilities of the Babangida administration in moving agriculture and the nation forward.


 

Notes

  1. See a summary of these objectives in FA0, World Food Summit Follow-up-Draft-strategy-for-National-Agricultural Development Horizon 2010: NIGERIA, Paper at World Food Summit 13 -17 November 1996, Rome.
  2. Adamu, British Colonial Agricultural Policies in Northern Nigeria (1902 – 45) M.A (History) Thesis, A.B.U. Zaria, 1992.
  3. Shenton and -M. Watts, Capitalism and Hunger in Northern Nigeria in Review of African Political Economy No. 15/16, 1979.
  4. Watts, Silent Violence: Food, Famine and Peasantry in Northern Nigeria, University of California Press, 1983.
  5. Ibid
  6. Ibid
  7. Shenton and Watts, op. Cit
  8. Olatunbosun and R. Olayide, Marketing Boards and their Effects on Output in Marketing Boards System NISER, 1972.
  9. O: Olayide, Economic Survey of Nigeria, 1960 i5 75, Aromolaran Publishing Company, lbadan, 1976.
  10. Awoyemi, Character of Nigerian Agriculture Bullion Vol. VI No. 4 1984, CBN.
  11. B. Babangida, 1986 Budget Speech New Nigerian 2nd January, 1986.
  12. 1987 Budget Speech New Nigerian 2nd January,’ 1987.3.
  13. 1991 Budget Speech New Nigerian, 3rd January, 1991.
  14. World Bank,   Nigeria: Structural Adjustment Program        Policies, Implementation and Impact, Washington, 1994.
  15. Ibid
  16. See FAO, op.cit
  17. O. Oyebanji, Agricultural Development Program in (FACU) Nigeria: An Assessment of the state of Food Production and Supply (Mimeo.)
  18. ibid
  19. ibid
  20. Jibrilu, “Food Insecurity in Nigeria: The Perspective of a Farmer.”