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World Bank says Nigeria dying slowly and living on borrowed time

World Bank says Nigeria dying slowly and living on borrowed time


The World Bank on Thursday reported that Nigeria was dying slowly and living on borrowed time due to the immense neglect of the heavily gifted agricultural sector and heavy rely on crude oil that has only caused the nation more hazard than progress.

This is as the Vice President, Prof Yemi Osinbajo assured that the Buhari administration will ensure an export based economy, especially as it recognises the importance of the agriculture sector to food security, job creation and poverty reduction.

He said the sector remains one of the priority areas of the government that has attracted various intervention programmes under the Agricultural Promotion Policy.

According to The Sun News, Senior Agriculture Economist, World Bank, Dr Adetunji Oredipe, who made the disclosure in Abuja while delivering a keynote address at the agriculture summit Africa sponsored by Sterling Bank Plc, said economic diversification into agricultural should be in practice not theory as the economy has become increasingly dependent which has proven to be both a "disaster and calamity."

According to him, if Nigeria had held to its market share in palm oil, cocoa, groundnut and cotton, the country would be earning at least $10bn annually from these three commodities.

The event was attended by the Vice President Yemi Osinbajo who was represented by the Minister of State for Agriculture and Rural Development,Mustapha Shehuri; Minister of Women Affairs Mrs Paulen Talen; Governor of Kebbi State Atiku Bagudu; Chairman of Sterling Bank Plc, Asue Ighodalo; and the Managing Director of Sterling Bank Plc Abubakar Suleiman.

Analyzing a gloomy picture of the country’s agricultural sector, the World Bank Agric Economist said that Nigeria is now one of the largest food importers in the world.

He said: “In 2016 alone, Nigeria spent $965m on the importation of wheat, $39.7m to import rice and $100.2m on sugar importation.

He added that the decision to spend $655m on fish importation seems financially irresponsible given all the marine resources, rivers, lakes, and creeks in Nigeria.

He noted: “None of the above transactions (Importation of rice, fish, sugar) is fiscally, economically, or politically sustainable. Nigeria is tragically is living on borrowed time, a typical case of robbing Paul to pay Peter.

“For instance, each time we spend money to import rice, Nigerian local rice farmers are negatively affected in terms of morale, sales, and realizable income.

He lamented that despite the huge agricultural potential, Nigeria which used to be the major player in agriculture in the world has lost its place in the global community.

He said, “In the 1960s we had glory. That glory was visible and significant for the global community to recognize and applaud. Nigeria accounted for 42 per cent of the world’s exports of shelled groundnuts. Our total export volume was 502, 000 MT.

Read Also: The Nigeria Collapse From Economic Stability Built On Agriculture To The Present Oil Dependent Suffering

“This declined to 356 MT by 2016. Nigeria lost her leadership position and was overtaken by USA, China, and Argentina. Nigeria was also the largest exporter of palm oil in the world and accounted for 27 per cent of the global export volume for palm oil.

“Total export volume for palm oil by Nigeria was 167,000 MT in 1961. This declined to 8,000 MT by 2016as the global export volume rose from 629,000 MT in 1961 to over 42.1 million MT in 2016.

“Malaysia and Indonesia took over using the oil palm seedlings obtained from Nigeria. In 2018, Malaysia earns $8.7bn, 28.6 per cent of total palm oil exports from export of palm oil alone.

"Indonesia alone recorded US$16.5bn, 54.5 per cent of total palm oil exports. Unfortunately, Nigeria is not listed among the first 15 as at this moment."

He said the huge taste of Nigerians for imported food items had also contributed to high levels of unemployment for youths.

"Food producing factories in Western world, Far East Asia and other countries employ millions of young people to produce and export food. This is a source of livelihood and it helps the workers to live well and go to school.

"But on our side of the world, Nigerian youths have no one to hire them to their capacity. This is a typical case of disguised employment or unemployment. It is unacceptable for our graduate to have no one who needs their university/polytechnic acquired- knowledge and skills.

Read Also: The Nigerian Youth And Greatness

"We must use the power of our population to our advantage by buying local foods,’ he added.

To reverse this trend, Oredipe said the government must articulate a clear vision to achieve a hunger-free Nigeria, through an agricultural sector that drives income growth, accelerates achievement of food and nutritional security, generates employment and transforms Nigeria into a leading player in global food markets.

In doing this, he said the vision of the government should be to revive the rural economy by transforming Nigeria into an agriculturally industrialized economy, create wealth, jobs, and markets for farmers.

He said, "We must adopt an ambitious agricultural promotion strategy, one that is focused on a combination of transformational policy reforms and private capital investments with a promise to expand the benefits to millions of Nigerians.

"The government needs revamp their current outlook about how agriculture works by inviting the private sector capacities in order to improve efficiency.

"We need to focus on agricultural value chains and not just on increasing production.

"A mere boost in production will lead to wastage if there are no markets and no agro-processing firms to rapidly absorb and  mop up the increased yields.

He added, "We also need to realise that it is extremely difficult to produce, process, and market at the same time. It is better to specialize and pick a certain aspect to focus on.

"This type of knowledge and understanding does not come easily. Professionals in many industries such as medicine, education, information-technology, allied healthcare, engineering and many more need evidence-based knowledge and information to up-date their skills in order to compete globally. Access to information is also becoming an integral part of agriculture as a core profession."

He also said government should rigorously and transparently evaluate all major policies and initiatives aimed at boosting agricultural development.

For instance, the economist said a closer focus on agricultural finance schemes could boost its potential to foster an enabling environment to crowd-in private investment.

“The most fundamental cause of low investment in agriculture is the low expected profitability, which stems from the low productivity.  Additional factors contributing to this situation include an unfavorable business climate; infrastructural deficiencies; limited access and use of long-term business credit; and the high risk of investment,” he added.

He also said there is need to address the issue of high post-harvest losses, especially for perishables such as horticulture produce.

For example, Oredipe said Nigeria produces 1.8 million MT of tomatoes per year, accounting for 68 per cent of the total production of West Africa.

However, he said over 45 per cent of this is lost annually due to post-harvest losses. Despite this, he said Nigeria continues to spend over N16bn annually on tomato paste importation making the country the largest importer of tomato paste from China and Italy.

He said, "We need to find better ways to link farmers with off-takers and processers. Our off-takers imports food items being produced by our famers because they are not aware of the products in the local market.

"Likewise, our farmers incur huge post-harvest produce loss simply because they cannot secure off-takers to buy the produce within the necessary frame of time".

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