Achieving The Goal Of Zero Hunger Through Agricultural Financing In The Nigeria Economy

Project and Seminar Material for Economics

Achieving The Goal Of Zero Hunger Through Agricultural Financing In The Nigeria Economy


Abstract


This study focused on achieving the goal of zero hunger through agricultural financing in the Nigeria economy. The study was carried out to find out the extent agriculture contributes to food security in Nigeria Economy, ascertain whether there is a significant relationship between poor agricultural financing and the level of hunger in the Nigerian society, find out other factors affecting the productivity level of the agricultural sector in Nigeria economy, determine whether adequate financing of the agricultural sector will boost food security and accessibility in Nigeria, and determine whether adequate financing of the agricultural sector will help to achieve the SDG of goal of achieving Zero hunger. The survey design was adopted and the simple random sampling techniques were employed in this study. The population size comprised of employees of staff of Federal Ministry Of Agriculture, Abuja. In determining the sample size, the researcher conveniently selected 147 respondents and 141 were validated. Self-constructed and validated questionnaire was used for data collection. The collected and validated questionnaires were analyzed using frequency tables, and mean scores. The hypotheses was tested using Chi-square statistical tool. The result of the findings reveals that adequate financing of the agricultural sector will boost food security and accessibility in Nigeria. The study also revealed that adequate financing of the agricultural sector will help to achieve the SDG of goal of achieving Zero hunger. Therefore, it is recommended that efforts should be geared towards transforming the agricultural sector to make it a growth engendering and a reliable one for the Nigeria economic system so as to be able to move towards the standard set out in the millennium development goals (MDGs). To mention but few.


Table of Content


Chapter One:

Introduction

  • 1.1 Background of the Study
  • 1.2 Statement of the Problem
  • 1.3 Objective of the Study
  • 1.4 Research Questions
  • 1.5 Research Hypothesis
  • 1.6 Significance of the Study
  • 1.7 Scope of the Study
  • 1.8 Limitation of the Study
  • 1.9 Definition of Terms
  • 1.10 Organization of the Study

Chapter Two:

Review of Literature

  • 2.1 Conceptual Framework
  • 2.2 Theoretical Framework
  • 2.3 Empirical Review

Chapter Three:

Research Methodology

  • 3.1 Research Design
  • 3.2 Population of the Study
  • 3.3 Sample Size Determination
  • 3.4 Sample Size Selection Technique and Procedure
  • 3.5 Research Instrument and Administration
  • 3.6 Method of Data Collection
  • 3.7 Method of Data Analysis
  • 3.8 Validity of the Study
  • 3.9 Reliability of the Study
  • 3.10 Ethical Consideration

Chapter Four:

Data Presentation and Analysis

  • 4.1 Data Presentation
  • 4.2 Analysis of Data
  • 4.3 Answering Research Questions
  • 4.4 Test of Hypotheses

Chapter Five:

Summary, Conclusion and Recommendation

  • 5.1 Summary
  • 5.2 Conclusion
  • 5.3 Recommendation
  • References
  • APPENDIX
  • QUESTIONNAIRE

Chapter One


Introduction

1.1 Background of the Study

The Nigeria agricultural Policy provides, among others, adequate financing of agriculture. The role of finance in agriculture, just like in the industrial and service sectors, cannot be over- emphasized. Public expenditure on agriculture has, however, been shown not to be substantial enough to meet the objective of the government agricultural policies IFPRI, 2008. For a developing country with a mono-product oil economy such as Nigeria, inadequate financing of agriculture portends great danger for many reasons (Adeleye, Osabuohien, Asongu, 2020).
The primary goal of agricultural financing policies in Nigeria is to establish an effective system of sustainable agricultural financing schemes, programs and institutions which could provide micro and macro credit facilities for the small, medium and large-scale producers, processors as well as marketers.

However, agriculture contributes immensely to the Nigerian economy in various ways, namely, in the provision of food for the increasing population; supply of adequate raw materials (and labour input) to a growing industrial sector; a major source of employment; generation of foreign exchange earnings; and provision of a market for the products of the industrial sector (Allen, Heinrigs, Heo, 2018).

The Nigerian agrarian sector has a strong rural base; hence, concern for agriculture and rural development become synonymous with a common root.

Hunger is a common element, especially within some sub-Sahara African countries, part of which made the United Nations to come up with an eight-point agenda for the achievement of the Millennium Development Goals by year 2015. The government also declared a seven- point (later reduced to five) agenda that includes self-sufficiency in food production. Nigeria as a signatory to United Nations conventions has made policies to assist farmers increase total output of agricultural produce: to earn foreign exchange and for employment, especially for the sustenance of the burgeoning population. Hun- ger has led to the decimation of the population in some parts of the world, especially war-torn countries, where it has been difficult to practice agriculture.

Countries that have suffered natural disasters in form of low or dearth of rainfall, storm and severe flooding have experienced food short- ages, which have made those countries to ap- peal for food aid from donor countries. A myriad of problems have impaired the performance of the agricultural sector over the years in Nige- ria. These problems have resulted in limited agricultural produce of staples that can be ready for the table in less than one year (Okunneye 2002), and the continuous increase in the food imports leading to outflow of foreign exchange. For instance, $1.23 billion was spent on food imports in Third Quarter of the fiscal year 2010 (CBN 2010) with $1 billion alone spent on rice. This could either have been ploughed into as- sisting the farmers to increase local production or used to rehabilitate decaying infrastructure. At present 9 percent of Nigeria’s population is undernourished (UNDP 2008) and depends largely on food imports to satisfy the require- ments of the population. Globally, there is enough food for everyone, but 780 million per- sons are severely undernourished (FAO 1992) with the situation becoming more precarious yearly. This situation should improve as coun- tries become more self-sufficient in food pro- duction rather than depend on importation. For some countries, food output cannot be regarded as adequate for today’s mental needs in the face of continuous increases in the prices of good nourishing food. This has lasting effect through- out the lifetime of the individual.


1.2 Statement of the Problem

The increased global need for food is a problem for humanity (Osa- bohien et al., 2020; Jacobsen et al., 2013). Increasing food production to feed the teeming world population will continue to be a difficult task due to fewer arable land, high cost of farm implements needed for production as a result of inflation, less credit access to farmers, the land competition of food production with bio-fuel production and rural-urban migration among others (Jacobsen et al., 2013). As a result of this, there is a strong on-going deliberation on the best approach to gain speed with world population growth and increasing food production to meet the United Nations (UN) Sustainable Devolvement Goal 2 (which is to achieve food security at all level, improve nutrition for all, and promote sustainable agriculture) by 2030 (Osabohien et al., 2020; Osabohien et al., 2019).

To improve food production, various strategies have been envisaged by government and stakeholders at all levels; one of such strategies is hinged on the need to increase farmers access to agricultural finance (credit) to increase productivity, while others focus on agricultural di- versity (Osabohien et al., 2020a,b). These strategies are important because, in developing countries, especially in Africa, the agricultural sector accounts for more than 50% of the entire labour force and it contributes significantly to the Gross Domestic Product (GDP) (Osabo- hien et al., 2020a,b; Matthew et al., 2019). In the same way, the pro- duction of food across the African content, especially in Nigeria, agriculture represents a crucial proportion of activities engaged and captures about 80% of total industry size with livestock, forestry and fishing accounting for the balance of 20% (Osabohien et al., 2019). Irrespective of its crucial role, its contribution to GDP has currently dropped as a result of low yields resulting from constrained or limited access to credits by farmers. The sector’s contributions to GDP dropped from 31% (113.64 billion USD to 78 billion USD between 2013 and 2017 (Nevin et al., 2019).

Studies on the impact of agricultural credit and credit guarantee scheme to assist farmers increase food production for national food security are needed to help improve the flow of credit to the agricultural sector and improve the operations of guarantee schemes. This is in addition to the need to overhaul the entire credit guarantee scheme for maximum efficiency for food production.


1.3 Objectives of the Study

The main aim of this study is to assess how to achieve the goal of zero hunger through agricultural financing in the Nigeria economy. Other aims of this study are to:

  1. Find out the extent agriculture contributes to food security in Nigeria Economy
  2. Ascertain whether there is a significant relationship between poor agricultural financing and the level of hunger in the Nigerian society.
  3. Find out other factors affecting the productivity level of the agricultural sector in Nigeria economy.
  4. Determine whether adequate financing of the agricultural sector will boost food security and accessibility in Nigeria.
  5. Determine whether adequate financing of the agricultural sector will help to achieve the SDG of goal of achieving Zero hunger.

1.4 Research Questions

The following research questions will be answered in this study:

  1. To what extent does agriculture contribute to food security in Nigeria Economy?
  2. Is there a significant relationship between poor agricultural financing and the level of hunger in the Nigerian society?
  3. What are the other factors affecting the productivity level of the agricultural sector in Nigeria economy?
  4. Will adequate financing of the agricultural sector boost food security and accessibility in Nigeria?
  5. Will adequate financing of the agricultural sector help to achieve the SDG of goal of achieving Zero hunger?

1.5 Research Hypotheses

The following null hypotheses will validate this study:

  • Ho1: Adequate financing of the agricultural sector will not boost food security and accessibility in Nigeria.
  • Ho2: Adequate financing of the agricultural sector will not help to achieve the SDG of goal of achieving Zero hunger.

1.6 Significance of the Study

The development of agricultural and self sufficient in food production coupled with the provision of raw materials for growing industries is among the priorities of the Nigeria government in the successive development plan. Against this background the reviews of the financial problems facing agricultural production is essential as such review will enable the sector take the over increasing demand upon it. The framers will find this research work useful since they can know what to do in order to attract more credit for themselves.

Basically, the result of this study will also be useful to the following:

i. Government / Policy Makers:

It opens a thorough fare for government or policymakers in their efforts at evolving policies and programmes for the betterment of the Nigeria agricultural sector.

ii. The Public:

This research will enlighten the citizens on what to expect from the government and things to put in place to boost their agricultural output.

iii. Academia / Researchers:

This study will be useful to students and other researchers as it will form part of existing literature on issues of agricultural sector in Nigeria.


1.7 Scope of the Study

This study focuses on achieving the goal of zero hunger through agricultural financing in the Nigeria economy. Specifically, this study focuses on finding out the extent agriculture contributes to food security in Nigeria Economy, ascertaining whether there is a significant relationship between poor agricultural financing and the level of hunger in the Nigerian society, finding out other factors affecting the productivity level of the agricultural sector in Nigeria economy, determining whether adequate financing of the agricultural sector will boost food security and accessibility in Nigeria and determining whether adequate financing of the agricultural sector will help to achieve the SDG of goal of achieving Zero hunger.

The respondents to this study will be obtained from the Federal ministry of Agriculture, Abuja, FCT, Nigeria.


1.8 Limitations of the Study

In the course of carrying out this study, the researcher experienced some constraints, which included time constraints, financial constraints, language barriers, and the attitude of the respondents. However, the researcher were able to manage these just to ensure the success of this study.

Moreover, the case study method utilized in the study posed some challenges to the investigator including the possibility of biases and poor judgment of issues. However, the investigator relied on respect for the general principles of procedures, justice, fairness, objectivity in observation and recording, and weighing of evidence to overcome the challenges.


1.9 Definition of Terms

Agriculture:

It is a way of cultivating farm products like yam, rice and groundnut etc.

Financing:

it is the study of the feature and functions of the means of payment also to arrange credit.

Agricultural Financing:

Is the study of financial intermediaries who provide loanable funds for agricultural production and that of financial markets in which these intermediaries obtain their loanable funds.


1.10 Organization of the Studies

The study is categorized into five chapters. The first chapter presents the background of the study, statement of the problem, objective of the study, research questions and hypothesis, the significance of the study, scope/limitations of the study, and definition of terms. The chapter two covers the review of literature with emphasis on conceptual framework, theoretical framework, and empirical review. Likewise, the chapter three which is the research methodology, specifically covers the research design, population of the study, sample size determination, sample size, and selection technique and procedure, research instrument and administration, method of data collection, method of data analysis, validity and reliability of the study, and ethical consideration. The second to last chapter being the chapter four presents the data presentation and analysis, while the last chapter(chapter five) contains the summary, conclusion and recommendation.


Chapter Five


Summary, Conclusions and Recommendations:

5.1 Introduction

This chapter summarizes the findings on achieving the goal of zero hunger through agricultural financing in the Nigeria economy. The chapter consists of summary of the study, conclusions, and recommendations.


5.2 Summary of the Study

In this study, our focus was on achieving the goal of zero hunger through agricultural financing in the Nigeria economy. The study is was specifically set to find out the extent agriculture contributes to food security in Nigeria Economy, ascertain whether there is a significant relationship between poor agricultural financing and the level of hunger in the Nigerian society, find out other factors affecting the productivity level of the agricultural sector in Nigeria economy, determine whether adequate financing of the agricultural sector will boost food security and accessibility in Nigeria, and determine whether adequate financing of the agricultural sector will help to achieve the SDG of goal of achieving Zero hunger.

The study adopted the survey research design and randomly enrolled participants in the study. A total of 141 responses were validated from the enrolled participants where all respondent arestaff of Federal Ministry Of Agriculture, Abuja.


5.3 Conclusions

In the light of the analysis carried out, the following conclusions were drawn.

  1. Agriculture contributes highly to food security in Nigeria Economy.
  2. There is a significant relationship between poor agricultural financing and the level of hunger in the Nigerian society.
  3. The other factors affecting the productivity level of the agricultural sector in Nigeria economy include; non-implementation of government policies, lack of modernization and mechanization, poor infrastructure/ lack of social amenities, loss of land to natural disaster, and insecurity.
  4. Adequate financing of the agricultural sector will boost food security and accessibility in Nigeria.
  5. Adequate financing of the agricultural sector will help to achieve the SDG of goal of achieving Zero hunger.

5.4 Recommendation

The following recommendations were proffered with respect to the findings of the study;

  1. Efforts should be geared towards transforming the agricultural sector to make it a growth engendering and a reliable one for the Nigeria economic system so as to be able to move towards the standard set out in the millennium development goals (MDGs).
  2. The interest rates should be maintained at a level that it will encourage funds mobilization for the agricultural sector that will translate into output growth for the entire economy.
  3. The commercial and specialized banks should be encouraged in terms of funds disbursement to the agricultural sector so as to ensure proper utilization of such funds for the benefit of the sector in particular and the entire economic system as a whole.
  4. The farmers need to be properly educated on the requirements of the supporting groups (Interest Drawback and the Linkage Group) to enable them benefit from the assistance the Fund is offering. The groups will help in self and internal guarantees for members. In addition, more enlightenment programs are needed on this.
  5. The numbers are increasing and Nigeria need not wait until a crisis arises before some- thing is done, which is one of the reasons why the import bills have kept rising in spite of further credits to the agricultural sector.
  6. An area for future research would concern the optimum amount of credit that should be available for productive agriculture and for food security, which should take into the consideration the variables of total credit and population growth in the economy.

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