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African Journal of Agricultural Marketing ISSN 2375-1061 Vol. 8 (6), pp. 001-009, June, 2020. Available online at 
www.internationalscholarsjournals.org © International Scholars Journals 

 

Author(s) retain the copyright of this article. 
 

 

Full Length Research Paper 

 

Effects of agricultural reforms on the agricultural 
sector in Nigeria 

 
Daniel S. Ugwu*, and Ihechituru O. Kanu 

 
Department of Agricultural Economics and Extension, Enugu State University of Science and Technology, 

P. M. B, 01660 Enugu, Enugu State, Nigeria. 
 

Accepted 12 December, 2019 
 

The various economic reform strategies undertaken by governments over a period of about three 
decades on the agricultural sector in Nigeria were the exploitative strategy, agricultural project strategy, 
direct production strategy and integrated rural development strategy. Overall, these economic reform 
strategies were geared toward the achievement of food self-sufficiency and food security, generation of 
gainful employment, increased production of raw materials for industries, increased production and 
processing of export crops, rational utilization of agricultural technologies for the improvement of life 
of its citizens. These strategies notwithstanding, government also pursued other on-going initiatives to 
step-up agricultural development across the country. The effects of economic reforms on the 
agricultural sector was examined alongside its fundamental roles of food security, supply of raw 
materials to industries ,provision of market, employment and foreign exchange as well as generation of 
savings for investment in agriculture and other sectors. Agriculture contributed minimally during the 
period in terms of output, market, foreign exchange and capital formation or transfer as a result of 
policy instability, poor coordination of policies, poor implementation and mismanagement of policy 
instruments and lack of transparency. It is recommended that an enduring genuine democracy and 
good governance should be allowed to thrive in Nigeria in order to achieve poverty reduction, 
sustainable livelihood and food security which will guarantee comprehensive economic development 
and attainment of the Millennium Development Goals (MDGs). 

 
Key words: Agriculture reforms, effects, agriculture, Nigeria. 

 
INTRODUCTION 

 
Nigeria is an agrarian country with about 70% of her over 
140 million people engaged in agricultural production 
(NBS/CBN, 2006) and provides subsistence for two-thirds 
(2/3) of Nigerians who are low income earners (Usman, 
2006). While the Northern part can guarantee the 
production of cereals such as sorghum, maize, millet, 
groundnut, cowpea and cotton, the Middle Belt and the 
South have the potentials to produce root tubers such as 
cassava, yam, cocoyam and other crops like plantain as 
well as maize (Abdullahi, 2003). In addition to crops, the 
country is also involved in the production of 
livestock,fisheries, forestry and wildlife.  
 
 
 
*Corresponding author. E-mail: ugwuds@yahoo.com. Tel: 
08035673526. 

 
 
 
 
 

Nigeria is generally endowed with abundant natural 
resources, numerous all-season rivers and a favourable 
tropical climate. Rainfall is generally adequate and fairly 
well distributed throughout the country (Ukpong et al, 
1995). Out of the 98.321 million ha of land available in 
Nigeria, about 75.30% may be regarded as arable land, 
which 10% is under forest reserves and the remaining 
14.70% is assumed to be made up of permanent 
pastures, built up areas and uncultivable waste (Olajide, 
1980).In the light of the foregoing, agriculture is still a 
major sector as well as remains the cornerstone of 
theNigerian economy (Salami, 2006; Igboeli, 2000). 

 
The problem 

 
Although agriculture had  remained the mainstay  of  the 

file:///C:\Users\user\Documents\REPUBLICATION\AGRICULTURAL%20SCIENCES\AppData\Local\Temp\www.internationalscholarsjournals.org


 
 
 

 

Nigerian economy, there has been declining contributions 
of agriculture to the gross domestic product (GDP) in the 
past three decades. This could be associated with the 
gross neglect of the agricultural sector and over 
dependence on the oil sector. In the pre-and post 
independence era (1930 to 1965), the Nigerian economy 
was predicated on agriculture. Agriculture employed 
about 70 to 80% of the country’s labour force (Falusi and 
Olayide, 1980) and contributed 60% of the nation’s gross 
domestic product (GDP) and foreign exchange earnings 
(CBN, 1985).  

In the oil boom era (1966 to 1977) the oil sector came 
to a prominent position as an important source of the 
national revenue. The oil sector which used to contribute 
a meager 2.6% of the GDP in 1960 contributed 57.6% to 
the GDP in 1970 and up to 99.7% in 1972 (Keke, 1992). 
Agriculture, on the other hand, contributed only 12% to 
the GDP in 1970 which culminated in rising food import 
bill leading to the persistent huge deficit in the balance of 
payments over the years (Ugwu, 2007).  

In the post oil boom era (1977 to 2002), the price of 
crude oil started falling and/or fluctuating and there has 
been a growing concern to revitalize the agricultural 
sector as well as diversify the economy.  

In order to revamp the agricultural sector, the federal 
government had embarked on and implemented several 
agricultural policies and programmes some of which are 
defunct or abandoned, and some restructured while 
others are still in place. These include the farm settlement 
scheme, National Accelerated Food Production (NAFPP), 
Agricultural Development Projects (ADPs), River Basin 
Development Authorities (RBDAs), National Seed Service 
(NSS), National Centre For Agricultural Mechanisation 
(NCAM), Agricultural And Rural Management Training 
Institute (ARMTI) and Agricultural Credit Guarantee 
Scheme Fund (ACGSF). Others were the Nigerian 
Agricultural Cooperative And Rural Development Bank 
(NACRDB)/agricultural bank, Operation Feed the Nation 
(OFN), Green Revolution Programme, Directorate Of 
Foods, Roads And Rural Infrastructure (DFFRI), Nigerian 
agricultural insurance  
company (NAIC), National Agricultural Land Development 
Authority (NALDA), Specialised Universities for 
Agriculture, Root and Tuber Expansion Programme 
(RTEP) and rural banking scheme, etc (Salami, 2007).  

Furthermore, the Federal Government in 2004 
launched another economic reform called National 
Economic Empowerment And Development Strategy 
(NEEDS) programme to encourage private sector 
participation in the development of the economy. It was 
also aimed at promoting growth and poverty reduction 
through a participatory process involving civil society and 
development partners. In the agricultural sector, NEEDS 
were directed to influence improvement in the production, 
processing and distribution of agricultural commodities. 
NEEDS was short-lived for only one year and therefore 
could not transform or make significant impact on the 

 
 
 
 

 

agricultural sector.  
Despite all the aforementioned reform policies and 

programmes, the performance of the sector had not fared 
better than it was before independence. It is against this 
background that this research was designed and 
considered imperative at this time in the nation’s history. 

 

Research objectives 
 
This study was therefore designed primarily to assess the 
performance and the effects of these government 
agricultural reforms and strategies on the agricultural 
sector. Specifically the study sought to: 
 
1. Review  the  various  federal  agricultural  reforms,  
programmes and interventions designed and 
implemented to restore agriculture to its prime position in 
the economy.  
2. Determine the effects and nature of the individual 
contributions of these reforms and programmes on the 
agricultural sector.  
3. Identify the problems and/or factors that militate 
against the achievement of the desired impact of these 
reform programmes/strategies on the agricultural sector.  
4. Proffer recommendations for improvement based on 
findings. 
 
 
RESEARCH METHODOLOGY 
 
Study area 
 

Nigeria was the focus of the study. It has an area of 923,769 km
2
 

and a population of over 140 million people. It is bounded on the 
West by the Republic of Benin and the Republic of Niger; on the 
East by the Republic of Cameroon; on the North by Niger and Chad 
Republic’s and on the South by the Gulf of Guinea. The climate is 
equatorial and semi-equatorial. There are two seasons; the wet and 
dry season and agriculture is a major employer of labour, and the 
mainstay of the economy despite her dependence on oil.  

The approach used for this research were mainly desk study, 
data collection from secondary sources as well as analysis of data 
using descriptive statistics and other qualitative methods. 
 
 
Data collection 

 
This involved desk study and/or review of relevant literature such as 

journals, technical documents, government gazettes, CBN annual 

reports and bullions, and published materials from the National Bureau 

Of Statistics and the National Planning Commission (NPC), among 

others. Internet resources were also consulted.  
This also involved the collection of time series data on gross 

domestic product (GDP), output of agricultural products, exports 
and revenues, etc. The study focused on data/information available 
from 1960 to 2009. 

 

Data analysis 
 
Data collected were analysed using such descriptive statistics as 
percentages, means/averages, frequency tables, charts as well as 



 
 
 

 
cross tabulations. 
 

 

RESULTS AND DISCUSSION 

 
Historical perspective of agricultural reforms/policies 
and programmes 

 

Nigeria’s perception of the place and role of agriculture in 
national development changed considerably over time. 
The affected policies, strategies and schemes used to 
address issues of the scheme equally changed. Different 
strategies adopted by the country shows dynamism and 
changing strategies that overlaps and cannot be 
appropriately segregated into time phases. Often it was a 
combination of two or more strategies to implement 
agricultural policies designed at different time periods. 
According to Olayemi (1998) agricultural development 
strategies that have been adopted in the country can be 
categorised into the exploitative strategies, the 
agricultural project strategy, the direct government 
production strategy and the integrated rural development 
strategy. 
 

 

Exploitative strategy 

 

The Nigerian Government during the colonial period and 
early years of independence adopted this strategy for 
agricultural development. In the 1950s the traditional 
economists observed agricultural sector as a residual, 
subsistence sector made up of peasant farmers. Myint 
(1958) in his “Vent-for-surplus” theory particularly 
categorized a developing economy as consisting of a 
“modern sector” that is largely non-agricultural and a 
“subsistence sector” that is agricultural. The subsistence 
sector that is perceived to be unproductive but full of 
under-utilized resources is expected to feed the modern 
sectors. As such, the subsistence sector was expected to 
be taxed to finance the modern sector. This essentially 
was the basis of the agricultural strategy in the 1950s and 
the 1960s in Nigeria with levies on export crops providing 
revenue for government to develop the modern sector 
(Adubi 2004). The Government established institutions 
such as the agricultural marketing board system to boost 
revenue generation efforts through taxing of peasant 
farmers that produce export crops such as cocoa, 
groundnut, palm produce, cotton, etc. 
 

 

Agricultural project strategy 

 

The period coincided with the time of internal self 
government up till 1968. Government intervention in 
agriculture was minimal. The small-scale farmers in 
Nigeria bore the brunt of agricultural development efforts 
(Egwu and Akubuilo, 2007). Agriculture was seen as a 
sector that has appropriate linkage with other sectors and 

     
 

 

should be developed in complementarity with other 
sectors thereby effecting the needed forward and 
backward linkages. Agriculture was regionalized with the 
establishment of extension fields and research institutes. 
Regional public funds were invested in agriculture and 
there were new schemes such as farm settlement 
schemes (established to create modern literate farmers 
and promote agricultural development). Tree crop 
plantations, smaller farmer credit schemes, and 
Agricultural Development corporation projects were 
established to encourage development of tree crops. 

 

Direct government production strategy 
 
According to Olayemi (1998), this was merely a 
deepening of the process of direct government 
intervention and investment in agriculture. This period 
started in 1970 and coincided with the oil boom in 
Nigeria. There was massive Federal Government 
intervention and investment in agriculture. The reasons 
were first, the need for the rehabilitation and resuscitation 
of agriculture after the civil war. This demanded 
immediate huge investments by government in 
agriculture given that there was low capacity in the 
private sector. Second, the ideological imperatives in the 
world then favoured direct involvement of government in 
directing investments in agricultural business and allied 
activities (Adubi, 2004). The period witnessed direct 
involvement of governments in directing investments in 
agricultural production activities and the establishment of 
schemes and research institutes such as National 
Accelerated Food Production Project (NAFPP), Nigerian 
Agricultural Co-operative Bank (NACB), etc. 

 

Integrated rural development strategy 
 

The government realized in the mid 1970s that the 
strategy of direct agricultural production was not yielding 
the desired results. So, there was gradual shift to an 
agricultural development approach which involved the 
adoption of an integrated rural development strategy 
(Olayemi, 1998). Under this strategy, rural development 
was seen from a holistic perspective with agricultural 
development problems being only part of a larger rural 
development concern. This prompted the government to 
embark on multipurpose rural development programmes 
and implementing institutions such as the Agricultural 
Development Projects (ADPs), the River Basin 
Development Authorities (RBDAS), the Directorate Of 
Food, Roads And Rural Infrastructure (DFRRI), the 
National Agricultural Land Development Agency, 
(NALDA), the Operation Feed The Nation (OFN), the 
Green Revolution (GR), etc. This integrated rural 
development strategy was also adopted during the 
Structural Adjustment Programme (SAP) era but with 
significant changes in institutional design, intensity of 
activities and modes of operation. 



 
 
 

 

Effects of agricultural reforms, policies and 
programmes on the agricultural sector 

 

The assessment of the effects of the agricultural reforms 
and policies on the agricultural sector is with respect to 
the fundamental roles, of agriculture, namely; 

 

i. Provision of adequate food for a growing population and 
raw materials for industries.  
ii. Provision of an expanding market for non-agricultural 
products  
iii. Generation of savings for investment in agriculture as 
well as other sectors and release of surplus or under-
utilized resources to other sectors. 
iv. Generation of foreign exchange. 

 

These are discussed in line with the historical periods of 
the various policy reforms and programmes as follows: 
 

 

The 1960 to 1969 era (period of minimum government 
intervention) 

 

During this phase, government intervention in agriculture 
was minimal. The small-scale farmers in Nigeria bore the 
brunt of agricultural development efforts (Egwu and 
Akubuilo, 2007). According to Olayemi (1995) 
government effort took the form of settling policies and 
creating institutions for agricultural research, extension 
and export crop marketing and pricing. Agricultural 
development during this period was equated as the 
withdrawal of surplus rural labour and transferring them to 
the industrial sector. Government established farm 
settlements and government research institutes and 
agricultural development corporations. This period 
witnessed visible decline in export crop production and 
mild food shortage. There was a decentralized approach 
to agriculture with initiatives being left to the regions and the 

states while Federal Government played a supportive role. 
Regional governments were executing adhoc policies, 
programmes and projects. The effects of these 
reforms/policies on agricultural performance include 
increase in food supply short falls, and rise in retail food 
prices (Sanyal and Babu, 2010). The agricultural share of 
the GDP declined from 66% in 1959 to 50% in 1970. The 
decrease in export earnings and the increase in retail 
feed prices led to greater importation of food, which 
adversely affected the balance of payments during the 
late 1960s (Kwanashie et al., 1998).  

During the same period, agriculture maintained an 
average of about 56% GDP in the 1960s with about 63% 
in the first half of the decade (Tables 1 and 2). However, 
the foreign exchange earnings declined from 71% in 1964 
to 41% in 1969.  

The negative environmental effects of these policy 
reforms at this period, however, were noted to include 
increased deforestation of rain forests for cash crop 
production as well as loss of biodiversity including wildlife 

 
 
 
 

 
Table 1. Share of agriculture in the GDP (1960 to2006).  

 
 Period/Year Average share of Agriculture in GDP (%) 

 1960 to 1964 62.5 

 1965 to 1969 54.3 

 1970 to 1974 39.1 

 1975 to 1979 23.1 

 1980 to1984 23.3 

 1985 to 1989 37.9 

 1990 to 1994 29.93 

 1995 to1998 27.72 

 1999 to 2002 40.82 

 2003  32.60 

 2004  34.21 

 2005 1/ 41.83 

 2006 2/ 50.78 
 
Source: CBN annual report and statement of accounts (various 
issues). 

 
 

 

and indigenous plants. 
 

 

The 1970 to 1985 era (period of maximum 
government intervention) 

 

This phase was characterized by a change of policy from 
minimal government intervention to maximum in the 
agricultural sector. The oil boom featured in the era which 
brought about enormous financial investments in 
agricultural projects and institutions. Many agricultural 
policies and programmes were enunciated. The fiscal, 
monetary and trade policies under the macro-economic 
policies were launched during the era as enumerated as 
follows; 
 

Fiscal policy: Budgetary allocations to agriculture were 
substantially increased to accommodate capital and 
recurrent expenditures. However large budget deficits 
were recorded. The capital expenditure on agriculture 
declined from 6.2% of total capital expenditure by the 
Federal Government in 1973 to 4.0% in 1985. The 
expenditure of state government followed similar pattern 
for the period under review (Egwu and Akubilo, 2007). 
 

Tax policy: Income tax reliefs on incomes from new 
agricultural enterprises were pursued. 
 

Wage policy: A unified wage structure for all public 
sector workers was put in place. 
 

Monetary policy: Agricultural loans were given at 
concessionary interest rate of 6% per annum. In 1980s it 
was raised to 9% per annum. 
 

Establishment of schemes, institutions etc: The 



  
 
 

 
Table 2. Percentage contribution to gross domestic product by sectors.  
 

Product 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 

Oil 13.5 12.97 13.0 13.4 13.05 14.17 11.60 10.7 11.5 11.6 9.7 41.50 37.22 49.64 61.19 

Non oil 86.5 87.3 87.0 86.9 86.95 87.16 88.41 89.3 88.5 88.4 98.3 58.50 62.78 50.36 38.35 

Crops 29.9 29.8 29.8 29.5 31.13 31.47 32.27 22.7 32.4 32.3 32.9 29.6 30.48 37.05 45.09 

Livestock 5.2 5.1 5.0 4.0 5.23 5.19 5.21 5.2 5.1 5.1 5.1 2.04 2.14 2.75 3.32 

Forestry 1.3 1.3 1.3 1.2 1.27 1.24 1.22 1.2 1.2 1.2 1.1 0.41 0.95 0.54 0.64 

Fisheries 1.4 1.6 1.6 1.7 1.38 1.49 1.66 1.9 1.9 1.9 2.1 1.09 1.14 1.49 1.72 

Agriculture 37.8 37.8 37.7 37.2 39.01 39.39 40.36 40.99 40.61 40.45 41.23 32.6 34.21 41.83 50.78 
 
Source: CBN annual report and statement of accounts (several issues). 
 
 

 

Nigerian agricultural and co-operative bank (NACB) was 
established in 1973 to facilitate the granting of credit to 
Nigerian farmers. 

 

Mandatory sectoral allocation to agriculture:  
Commercial and Merchant Banks were mandated to 
extend a minimum of 6% of their loan portfolio to 
agriculture which was later increased to 12%. 

 

Rural banking scheme was launched in 1977 while the 
agricultural credit guarantee scheme was established in 
1977.  

Trade policy on abolition of export duties on scheduled 
export crops in 1973 in order to promote agricultural 
export trade. Liberalization of imports in respect of food, 
agricultural machinery and equipment. A summary of the 
micro-economic Policies in Agriculture during the era 
were as follows: 

 

1. Agricultural commodity marketing and pricing policy: In 
1977, six national commodity boards were established 
which include; commodity boards for cocoa, groundnuts, 
palm produce, cotton, rubber and food grains.  
2. Land use policy was promulgated by the Federal 
Government in 1978 vesting the ownership of all lands on 
the government as to give genuine farmers access to 
farmlands.  
3. Agricultural extension and technology transfer policy 
aimed at improving the adoption of improved agricultural 
technology by farmers with the national accelerated food 
production project (NAFPP) and agricultural development 
projects (ADPs) as implementing agencies.  
4. Input supply and distribution policy was promulgated to 
ensure adequate and orderly supply of agricultural inputs 
notably fertilizers, agro-chemicals, seeds, machinery and 
equipment. 

 

a) In 1975 Government centralized fertilizer procurement 
and distribution with numerous agro-service centres 
nation wide.  
b) In 1972 Government created national seeds service 
(NSS) to produce and multiply improved seeds such as 
rice, maize, cowpea, millet, sorghum, wheat and 

 
 
 

 

cassava. 
 

5. Agricultural input subsidy policy on fertilizer, seed 
(50%) agro-chemicals (50%) and tractor hiring services  
(50%).  
6. Agricultural research policy: The policy was aimed at 
coordination and harmonization of agricultural research 
and extension linkage. Agricultural research council was 
established in 1971.The 1973 Decree empowered the 
Federal Government to take over all state research 
institutions. The 1975 reconstitution by the Federal 
Government of the Nigerian Agricultural research 
Institute network led to the establishment of 14 institutes 
which were later increased to 19 and the creation in 1977 
of the national science and technology development 
agency to coordinate all research activities in Nigeria.  
7. Agricultural co-operatives policy: In 1979, a 
department of agricultural co-operatives within the 
Federal Ministry of Agriculture, Water Resources and 
Rural Development was created to actualize this policy 
aimed at encouragement of farmers to form co-
operatives and the use of same for the distribution of 
farm inputs and imported food commodities.  
8. Water resources and irrigation policy brought about the 
establishment of eleven River basin development 
authorities in 1977 charged with the responsibility of 
developing Nigeria’s lands and water resources.  
9. Agricultural mechanization policy: The policy was 
instrumental to the creation of the Ministry of Science and 
Technology and the establishment of some Universities 
of Science and Technology; the operation of tractor hiring 
units in all the states of Nigeria, reduced import duty on 
tractors and agricultural equipment and implements, 
generalized and liberalized subsidies on farm clearing 
and establishment of a centre for agricultural 
mechanization.  

In terms of effects of these agricultural reforms and 
policies on the agricultural sector, the imbalance in the 
flow of financial resources that characterized this period 
reflected in Nigeria’s foreign trade. During this period 
imports rose by 46.5% more than the planned targets, 
with food, capital equipment and raw materials being, the 
fastest growing categories of imports. Food imports as a 



 
 
 

 

share of total imports increased from 7.67% in 1970 to 
10.26% in 1979 (Osemeobo, 1992). At the same time as 
imports were increasing, agricultural production was 
suffering due to the latent impact of the civil war (1967 to 
1970) and the drought of 1972 to 1974 that led to a 
massive loss of crops and livestock. Despite government 
efforts in agricultural production, the performance of the 
agricultural sector was poor in terms of its growth, its 
export value, its contribution to GDP, and its share in 
Nigeria’s total export earnings.  

There was rapid decline in agricultural production with 
large food supply gaps (Sanyal and Babu, 2010) with 
attendant rapid increase in food imports from 7.7% in 
1970 to 10.3% in 1979. 
 

 

The 1985 to 1990 era (structural adjustment 
programme (SAP) and post SAP period) 

 

This era saw the Federal Ministry of Agriculture, Water 
Resources and Rural Development in 1988 produce an 
agricultural policy for Nigeria decreed to be operational 
for at least the next fifteen years. According to Ikpi (1995) 
the document embodied the following, among other 
policies; 
 

a) Agricultural sector policies and strategies on food 
crops, livestock and fish production, industrial raw 
material (crop and by-products) production, and forest 
products and wildlife.  
b) Policies on support services such as agricultural 
extension, technology development and transfer, 
agricultural credit; agricultural insurance; agricultural 
mechanization; water resources development; rural 
infrastructure; agricultural statistics and data bank; 
agricultural investment and management advisory 
services, and agricultural manpower development and 
training. The document assigned role and responsibilities 
to the three tiers of government, federal, state and local in 
the country. It also incorporated a mechanism for periodic 
policy review to allow for policy stability and perspective 
planning.  

With the adoption of Structural Adjustment Programme 
(SAP) in 1986, government admitted the failure of past 
policies to significantly improve the economy and reverse 
the declining trend of production in the agricultural sector. 
The Structural Adjustment Programme relied most 
especially on the agricultural sector to achieve the 
objectives of its far-reaching reforms on diversification of 
exports and adjustment of the production and 
consumption structure of the economy (Adubi, 2004). 
 

The objectives of SAP were to: 

 

1) Restructure and diversify the productive based of the 
economy so as to reduce dependency on the oil sector; 
2) Achieve fiscal stability and balance of payments 

 
 
 
 

 

viability over the medium term; and  
3) Promote economic growth with single digit inflation 
rates. 
 

Some of the key policies designed to achieve these 
objectives were: 
 

a) Measures to stimulate domestic production and 
broaden the supply base of the economy  
b) Liberalization of trade and export controls; 
c) Elimination of price control and commodity boards; 
d) Decontrol of interest rates, and  
e) Further rationalization and restructuring of the tariffs to 
smooth the way toward industrial diversification (Sonyal 
and Babu, 2010). 

 

Despite the aforementioned policy measures, the 
agricultural sector did not register significant overall 
growth for several reasons. First, SAP had more of an 
impact on the distribution of farm incomes than on 
agricultural growth and productivity (Kwanashie et al, 
1998). Second, on average, real producer prices of 
tradable goods did not change significantly after the 
policy reforms. The decline in output of the export crop 
subsector contributed to a reduction in foreign exchange 
earnings that could affect the foreign exchange 
requirement of the agricultural sector. As a result of this 
reduction and subsequent loss of export earnings from 
crops, the country’s dependence on crude petroleum 
export earnings between 1988 and 1992 increased 
substantially (Colman and Okorie, 1993).  

In this phase also, which marked the SAP period, there 
was lower agricultural and economic growth with high 
rates of unemployment. Export earnings declined to less 
than 5% (Table 3) as well as widening gap in food supply 
and demand. Food prices increased from 2.6% in 1970 to 
1979 period to almost 20% during 1980 to 1989.  

The environmental implications of these policy reforms 
were quite significant. During this period, there was 
increased deforestation with adverse impact on biotic 
resources, loss of biodiverty, increased desertification in 
arid areas and flooding in lowland areas. There was also 
evidence of increased use of chemicals and abuse of 
fertilizer use which led to soil degradation in certain agro-
ecological zones.  

With respect to the index of real agricultural sector 
GDP between 1985 and 1990, it was fluctuating over 
these years. It was negative in 1985 and 1986 and 
positive in 1987 to 1990. 
 

 

The new millennium agricultural policies (1999 to 
2009) 

 

At the inception of the new democratic administration in 
May 1999 and shortly before then, several institutional 
changes were made in order to realize the sector’s 



 
 
 

 
Table 3. Growth rate of real GDP-agriculture.  

 
Year Index of real GDP agriculture Growth rate 

1981 100.0  

1982 103.85 3.85 

1983 96.20 -3.80 

1984 90.59 -9.41 

1985 100.13 -0.13 

1986 98.44 -1.56 

1987 136.35 36.45 

1988 136.35 36.35 

1989 105.30 5.30 

1990 118.43 18.43 

1991 122.71 22.71 

1992 128.07 28.07 

1993 132.39 32.39 

1994 127.60 27.66 

1995 131.19 31.19 

1996 137.68 37.68 

1997 143.18 43.18 

1998 143.76 43.76 

1999 143.33 43.76 

2000 141.37 41.37 

2001 159.08 59.08 

2002 163.39 63.39 

2003 165.13 65.13 

2004 69.52 -30.48 

2005 71.79 -28.21 
 

Source: CBN statistical bulletin (various issues). 
 

 

objectives and in line with its belief that agricultural and 
rural development are sin quo non for improved economic 
recovery (Olomola, 1998). These include the relocation of 
the department of co-operatives of the Ministry of Labour 
and its merger with the agricultural co-operatives division 
of the Ministry of Agriculture, the transfer of the 
Department of Rural Development from the Ministry of 
Water Resources to the Ministry of Agriculture (all before 
1999), the scrapping of the erstwhile National Agricultural 
Land Development Authority (NALDA) and the merging of 
its functions with the rural development department, the 
scrapping of the Federal Agricultural Co-Ordinating Unit 
(FACU) and the Agricultural Projects Monitoring and 
Evaluation Unit (APMEU) and the setting up of Projects 
Co-Ordinating Unit (PCU) and later transformed into the 
National Food Reserve Agency (NFRA). Streamlining of 
institutions for agricultural credit delivery with the 
emergence of the  
Nigerian Agricultural Co-Operative and Rural 
Development Bank (NACRDB) from the merger of the 
erstwhile Nigerian Agricultural and Co-Operative Bank 
(NACB) and the Peoples Bank and the Family Economic 
Advancement Programme (FEAP). New Institutions were 
also evolving to enable the Nigerian agricultural sector 

  
  

 
 

 

respond to the imperatives of the emerging global 
economic order.  

The new agricultural policy has a clear statement of 
objectives. The policy seeks to attain self sustaining 
growth in all the subsectors of agriculture and the 
structural transformation necessary for the overall socio-
economic development of the country as well as the 
improvement in the quality of life of Nigerians. This 
objective reflects the current policy recognition of 
agriculture as a vital sector under the poverty reduction 
programme (FMARD, 2003).  

The government also sought to pursue the following 
specific objectives: 

 

i. Attainment of self-sufficiency in basic food commodities 
with particular reference to those which consume 
considerable shares of Nigeria’s foreign exchange and 
for which the country has comparative advantage in local 
production.  
ii. Increase in local production of agricultural raw 
materials to meet the growth of an expanding industrial 
sector.  
iii. Increase in production and processing of exportable 
commodities with a view to increasing their foreign 
exchange earning capacity and further diversifying the 
country’s export base and sources of foreign exchange 
earnings;  
iv. Modernization of agricultural production, processing, 
storage and distribution through the infusion of improved 
technologies and management so that agriculture can be 
more responsive to the demands of other sectors of the 
Nigerian economy.  
v. Creation of more agricultural and rural employment 
opportunities to increase income of farmers and rural 
dwellers and productively absorb an increasing labour 
force in the nation. 

 

Other initiatives that are on-going to step-up agricultural 

development and ensure food security are the root and 

tuber expansion programme, national cocoa development 

committee, Special Programme on Food Security (SPFS) 

and National Fadama Project. Others also include the Fish 

farm estate development, initiatives for increased 

agricultural production, south-south cooperation initiative 

and Nigeria-France project on agricultural development.  
This phase witnessed a drastic reduction in food 

imports from 14.5% to 5% of total imports. Presidential 
initiatives on specific agricultural commodities (for 
example cassava, rice) in order to generate N3 billion 
annually from exports also featured during this period. 
Public private partnership in the development of 
agricultural marketing as well as the promotion of 
integrated rural development marked this phase.  

The effects of these policy changes and programmes 
were reflected in the deficits recorded due to rising 
population and import restrictions on cereals and grains, 
supply shortages due to significant increase in land area 



 
 
 

 

under cultivation, and instability in input and output 
markets, among others. Annual deforestation rate 
remained at the rate of 76% per year due to higher 
demand for agricultural land, fuel wood and rapidly 
growing population (UNEP, 2006). Land degradation 
caused by soil erosion occurred at an alarming rate. 
However, Nigerian agriculture has shown good growth 
rates in the recent past with growth rates of 7.4, 7.2 and 
6.5% in 2006, 2007 and 2008 respectively. Between 2003 
and 2007 its average share of the national real GDP was 
41.5% thus underscoring its importance in the livelihood 
of Nigerians (FGN, undated). Of the growth in the 2003 to 
2007 period, the crop, livestock, fishery and fishery 
subsectors contributed 90, 6, 3 and 1% respectively. 
Major crops grown in Nigeria include yam, cassava, 
sorghum, millet, rice, maize, beans, dried cowpea, 
groundnut, cocoyam and sweet potato. These major 
crops which accounted for about 75% of total crop sales 
in 2004 increased from 81,276 thousand tones in 2004 to 
95, 556 thousand tones in 2007 (Eyo, 2008). 
 

 

Problems/challenges of the agricultural reforms, 
policies and programmes 

 

Evidence from Olayemi (1995), Olomola (1998), Garba 
(1998) have indicated minimal positive impact of these 
reforms/policies. The evidence stems from the decaying 
rural infrastructure, declining value of total credit to 
agriculture, and declining domestic and foreign 
investment in agriculture. The increasing withdrawal of 
manufacturing companies from their backward integrated 
agricultural ventures has reduced investments in the 
sector considerably. Input supply and distribution have 
been hap-hazard and inefficient and most agricultural 
institutions were ineffective prompting its scrapping in 
year 2000 of some of the institutions established for 
agricultural promotion.  

A critical examination of the reforms/policies and their 
implementation over the years show that policy instability, 
policy inconsistency, lack of policy transparency, poor 
coordination of policies as well as poor implementation 
and mismanagement of policy instruments constitute 
major obstacles to the implementation and achievement 
of the goals and objectives of these policies.  

Policy instability and lack of policy transparency are not 
unconnected with political instability and bad governance. 
For example, between 1979 and 1999 the country had 
five military/civilian regimes. At the federal and state 
levels, the then Ministers and Commissioners of 
Agriculture were changed several times on the average of 
one per two years. Several policy measures were initiated 
and changed without sufficiently waiting for policy effects 
or results. At one time or the other, agricultural production 
passed through periods of protection and unbridled 
opening up for competition. Also, it passed through era of 
“no government” and “less These could all be attributed 
to poor coordination and 

 
 
 
 

 

faulty implementation of policies as well as 
mismanagement of policy instruments.  

Agriculture contributed 42% of Nigeria’s gross domestic 
product (GDP) in 2008 (National Bureau of Statistics). 
However, despite having grown at an annual rate of 6.8% 
from 2002 to 2006, 2.8% higher than the sectors annual 
growth between 1997 and 2001, food security remains a 
major concern due to the subsistence nature of the 
country’s agriculture (Nwafor, 2008)  

Many of the strategies used to improve agricultural 
growth in the past have failed because the programmes 
and policies were not sufficiently based on in-depth 
studies and realistic pilot surveys (Adebaya et al., 2009). 
This could be attributed to lack of public participation in 
the design, formulation, implementation and evaluation of 
policies as well as limited implementation capacity within 
the sectoral ministries and a poor understanding of the 
details and specifics of polices by implementers 
(Adebayo et al., 2009).  

The main factors that influenced the effectiveness of 
policies on agriculture include high demand for 
agricultural produce, availability of improved technology, 
efficient dissemination of information by the ADPs and 
value added leading to improved income. On the other 
hand, the common factors responsible for the 
ineffectiveness of policies and regulations, especially on 
the downstream segment of agriculture, include instability 
of the political climate, insecurity of investment, non-
standardized product quality, non-competitive nature of 
agricultural products from the country in the export 
market due to high cost of production and lack of 
adequate processing facilities (The New Nigerian 
Agriculture Policy, 2001). 
 

 

CONCLUSIONS AND RECOMMENDATIONS 

 

In conclusion, the effects of economic reforms on the 
agricultural sector can be said to be unsatisfactory in 
view of its minimal contributions to the sector. In order to 
stem the aforementioned identified problems and 
weaknesses of these agricultural policies/reforms in the 
context of their contributions to the agricultural sector, 
genuine democracy and good governance should be 
allowed to thrive in Nigeria. This will guarantee poverty 
reduction, sustainable livelihood and enhanced food 
security which will lead to a comprehensive agricultural 
development as well as the attainment of the Millennium 
Development Goals (MDGs) in Nigeria. 
 

 
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