Efem Nkam Ubi, Research Fellow, Nigerian Institute of International Affairs
Subjects of Interest
- Economic Development
- Geopolitical Analysis
- International Affairs
- International Trade
Agriculture as an important factor in Nigeria-China relations 12 Apr 2019
At the early stages of political independence, many countries in Africa were major exporters of agricultural products. With particular reference to Nigeria, agriculture was the main source of revenue before the discovery of oil in 1956 and two years later when Nigeria became an oil producer. Ever since, Nigeria has witnessed a continuous decline of the agricultural sector.
But the importance of the sector is seen in the efforts by different administrations to implement various policies and programmes aimed at increasing the productivity of the sector, albeit without much success. Agriculture has also been the favourite sector to drive the economic diversification agenda of various administrations. Many of the initiatives failed for different reasons, including lack of commitment and corruption.
Noting the important role agriculture could play in a nations growth, the government of President Goodluck Jonathan launched the Agricultural Transformation Agenda (ATA), whose aim was not only to be a roadmap to resuscitate the agricultural sector. The ATA was also designed to encourage a shift from subsistence farming to commercial farming. Achieving this goal required making the sector more attractive to local and foreign investors, whilst also giving impetus to local production capacity of agricultural produce.
Although, the intervention of ATA helped to refocuse Nigeria’s attention on agriculture, problems still persisted. Then entered the administration of President Muhammadu Buhari, which came up with a Policy and Strategy Document, titled “The Agriculture Promotion Policy (APP) (2016 – 2020) Building on the Successes of the ATA, Closing Key Gaps.” As the Minister of Agriculture and Rural Development (FMARD), Audu Ogbeh, noted, “the focus of this administration is to rebuild a sector whose relevance had shrunk dramatically. That is reflected in the lack of lending to farmers by the financial system and the dramatic levels of food imports from across the world.”
That notwithstanding, the new policy is suppose to achieve two things for Nigeria. Firstly, it is aimed at making Nigeria self-sufficient in food production. And secondly, it is supposed to drive significant foreign exchange earnings for Nigeria from agriculture.
The current administration has also launched several other policies and programmes to boost the agriculture sector. These include the Anchor Borrowers' Programme (ABP), launched on November 17, 2015. It is a programme intended to create a linkage between companies involved in the processing of agricultural products and smallholder farmers (SHFs) of key agricultural commodities. Since its creation, the CBN reportedly disbursed over N55 billion to 862,069 farmers as at October 2018. And the programme is speculated to have created an estimated 890,000 direct and 2.6 million indirect jobs.
Another intervention programme is the Presidential Fertilizer Initiative (PFI), launched in December 2016. This was the result of a partnership between the governments of Nigeria and Morocco. There is also the Youth Farm Lab, an Initiative of FMARD in conjunction with Synergos, a nonprofit. The programme aims to train Nigerian youths in livestock production and sustainable urban agriculture.
The administration also launched the Presidential Economic Diversification Initiative (PEDI) in July 2017 to support the revival of moribund industries (especially in the agro-processing sector) by facilitating new investments, reducing regulatory bottlenecks and enabling access to credit. The Food Security Council was inaugurated on March 26, 2018. Chaired by the president, the Council’s objectives involve developing sustainable solutions to various challenges, including the farmers-herdsmen clashes, climate change and its impact on farmlands, the oil spillage in the Niger Delta, among others.
History has shown that Nigerian governments often come up with good policies but they would lack the political will and strategy to implement them. In another dimension, many of these policies and agencies are created as a way of providing “jobs for the boys.” That is why, overtime, Nigeria has remained developmentally undermined. More so, agriculture is one sector that has been looked down on by many.
It is high time the government declared a state of emergency in the agricultural sector. The sector has huge employment potentials. Therefore, it can be targeted to curb poverty and unemployment. In that respect, agriculture is and will remain key to socio-economic development of the nation.
Furthermore, for developing countries, especially Nigeria, developing the agricultural sector is not a government-alone-affair. Meaningful reforms in the agricultural sector must have Public Private Partnership (PPP) value proposition, where investors and other stakeholders are part of. The truth is that the financing needed to upgrade the sector will have to come from the private sector in cooperation with government. Although, private investors are beginning to invest in the sector; the numbers are still negligible. To encourage investments in the sector, it is important for the government to create a conducive environment and the necessary laws to attract these investors.
China and the United States are two of the world’s top countries known for agricultural biotechnology investment, with China being the second after the U.S. Cooperation with these countries is capable of addressing Nigeria’s food security needs, while adding to economic growth. Right now, China appears to be the more willing partner in supporting these efforts. The importance of agriculture in China-Africa cooperation is evident.
Recently, the Forum on China-Africa Cooperation (FOCAC) Summit and action plan has given exceeding consideration to China-Africa agricultural cooperation. For instance, the Johannesburg Action Plan (2016-2018) opined that the cooperation will contribute to food security in Africa and enhance agricultural transformation. The agenda for FOCAC Beijing Action Plan (2019-2021) include Africa’s agricultural modernization, implementation of 50 agricultural assistance programmes, training of entrepreneurs in agri-business, support for township and village industries, among other plans. This last point is exceedingly important for Nigeria in its drive for diversification.
Another platform for cooperation is the China-Africa Forum on Tropical Agricultural Science and Technology Cooperation. The first forum was held in Boao, South China's Hainan Province in 2018. There is also the Conference on China-Africa Agricultural Cooperation (CAACC). The latest forum was held recently in Haikou, Hainan province in China. It is important that Nigeria should capitalize on these forums to boost its agricultural potentials as well as attract foreign investments into the sector.
Furthermore, Nigeria should take advantage of the 2018 China’s pledge to advance capacity building and training opportunities for 800 agricultural technical and managerial professionals from Africa. The Chinese government also sent a team of 30 senior agriculture experts and teachers to Africa to provide vocational education as well as train African personnel in agro-technology and administration.
While Chinese interest in Nigeria’s agricultural sector is of utmost benefit for Nigeria, it nevertheless will also benefit China. In 2010, former Chinese Minister for Agriculture, Han Changfu, said, “The time is ripe for the country’s agricultural companies to embark on a go outward strategy.” Several Chinese government officials have also talked about an overseas option as a complement to strengthening domestic production.
It must be understood that, China – which is home to 22 percent of the world’s population – only possesses around 7 percent of arable land (334.6 million hectares). Interestingly, this land area has been shrinking as a result of serious environmental damage such as soil erosion, deforestation and pollution of rivers and lakes. In fact, in November 2014, it was reported by Chinese officials that more than 40 percent of China’s arable land is suffering from degradation. If the above is true, it, therefore, means China must expand its investment in agriculture to other countries that it relates with economically. In that case, Nigeria must be positioned by creating the enabling environment to absorb such investments in its agricultural sector.
The good news is that recent agreements between China and Nigeria have signaled China’s growing interest in the importation of agricultural products, e.g. cassava chips from Nigeria. The deal is to supply China, 2.2 million metric tonnes of cassava chips worth $272 million. In a bid to strengthen bilateral trade in the agricultural sector, a N10 billion Cassava Trust Fund has been established by the Nigerian government. Also, the formation of the staple crop processing zone in Kogi State has led to the setting up of the Cassava Growth Enhancement Support Scheme (CGESS). This entails providing support for the research and development of cassava products, training and provision of better-quality equipment for cassava production.
In showing commitment towards sustainability of the scheme, the China-Exim Bank has consented to supply financing for the acquisition of high-grade cassava flour processing plants to increase cassava products importation from Nigeria. Furthermore, Chinese enterprises have become the Nigerian government’s seed providers. China has also set up 50 model farms in Nigeria.
It is a fact that agriculture is one area where Nigeria lacks critical expertise. The country can draw lessons from other countries, especially China, where agricultural development and reforms have been a top policy priority for the Chinese government since the 1950s. The steady growth in agriculture and rural economy was critical to the acceleration of China’s modernization.
China's technology in agriculture and food production as well as investment is crucial for Nigeria to realize its goal of modernizing the agriculture sector and diversifying the government’s foreign exchange revenue base from overdependency on oil. In that regard, therefore, it is pertinent that Nigeria and China’s cooperation in this sector is taken seriously.
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