Food Security; A Means To Sustainable Economic Growth

Project and Seminar Material for Agricultural Economics and Extension

Food Security; A Means To Sustainable Economic Growth


Abstract


No doubt, no matter the development and height any person can scale, food will always remain relevant. The last thing that will get off anybody’s budget is food. It is a life-long essential and it will remain relevant as long as life remains. The paper exposes how important food security is and how food security can bring about sustainable economy growth. The paper recommends that public policy makers must as a matter of urgency see food security as a vital means to sustainable economic growth and as such develop sufficient political will to achieve increased food production; evolve food policy and eventually attain food security for all.


Chapter One


Introduction

1.1 Background of Study

Food security to a great extent affects economic growth. In order to measure economic growth, the market value of goods and services produced by a country in a given period of time is used. However, the national income or gross domestic product may increase and the standard of living may not improve. Therefore, economic growth is defined in terms of increase in standard of living. According to Leszek Balcerowicz, economic growth is a process of quantitative, qualitative and structural changes, with a positive impact on economy and on the population’s standard of life, whose tendency follows a continuously ascendant trajectory (Haller, 2012). Economic growth also spells an increase in per capita income. Hence, food security signifies an increase in the standard of living in a nation.

Food insecurity has been a major challenge in developing countries. According to Sen (1981), food insecurity occurs when the sum of all food that individuals, household or groups acquire from production, labour, trade and transfers is inadequate to meet their minimum consumption needs. Over 1 billion people world-wide are undernourished, many others suffer from micronutrient deficiencies, and the absolute numbers tend to increase further especially in sub- saharan Africa (FAO 2008 cited in Abu 2012). The secretary general of the United Nations, in the three day summit on world food security in Rome, laid out with statistical proof that today, more than one billion people are hungry, six million children die of hunger every day (Ojo and Adebayo 2012). Food insecurity is closely associated with poverty, hunger and vulnerability and this dominant in rural areas amongst farming households where food production is at a subsistent level.

Food security is a strong determinant of economic growth and development. A general proof for the development of a country is that less of its population should be involved in the agricultural sector and yet it must be able to produce sufficient food for the nation. There are three core values of Development in a country namely – subsistence, self-esteem and freedom. (Torado and smith 2009: 20). This represents the common goals sought by individuals and societies. Subsistence is ability to meeting the basic needs of the people which includes food, shelter health and protection. This entails that food provision is part of the first core values of development and a country unable to attain food security is considered a poor nation. Hence, being able to provide food security in a nation is one of the first step towards increasing standard of living.

Nigeria has battled immensely with food insecurity for over four decades due to the neglect of food production as oil became the major exported product and also because of the implementation of the non-liberal economic policies such as the naira devaluation, trade liberalization and withdrawal of government from economic activities, ethnic and religious conflicts; also disasters, such as flooding and drought have also contributed to food security in Nigeria (Otaha , 2013).

Nigeria is blessed with abundant agro-ecological resources and diversity, has become one of the largest food importers in sub-Saharan Africa (Idachaba 2009). Nigeria is richly endowed with abundance of natural and human resources that if effectively utilized can provide enough food to feed its people and export the surpluses to other nations. In the 1970s, the Nigerian economy grew at a mean per capital growth rate (GDP) of 1.1%. Back then, Nigeria was the major oil- suppliers in the world, hence Nigeria experienced huge profits from the high oil prices from late

1970s. Exports were boosted from US$ 4 billion in 1975 to US$ 26 billion in 1980. The GDP rose from US$440 in 1975 to over US$ 1000 in 1980. However the oil boom did not contribute to the manufacturing or agricultural sector, but rather increased rise in the urban service sector which eventually lead to the increased rate of the rural-urban migration (Mason and Martorell 1996).

In the 1960s, Nigeria was self-sufficient in food production, except for wheat and dairy products, which were imported (Mason et al., 1996). However, since 1972, food shortage had become rampant due to the neglect of the agricultural sector by the government. Till today Nigeria suffers from food scarcity and insecurity and this is one of the major cause of the recent recession and negative growth rate in Nigeria. Economic development is not merely an increase in GDP or production of goods and services but entails growth with structural change and constant improvement in all other sectors of the economy. Food insecurity is basically as a result of a deficiency in the agricultural sector which through backward and forward linkages would have an adverse effect on other sectors of the economy, which synonymously, would lead to stunted economic growth and development


1.2 Statement of the Problem

Food insecurity is virtually caused by the failure of the agricultural sector which in turn has a spill-over effect on other sectors of the Nigerian economy and a nation that cannot feed its self is tagged undeveloped, as food security is a pre-requisite for economic growth. Nigerian agricultural sector has been affected by long standing problems disrupting its productivity and contribution to the economic growth. This is as a result of various factors affecting it such as poor infrastructural facilities, mismanagement of resources, poor storage facilities, lack of youth participation, lack of capital and adequate techniques.

As a result of the above problems, agricultural contributions to the national income has been low since 1980s. Food imports continue to rise from N3.47 billion in 1990 to N113.63 billion in 2000.ie it rose from 3.5% in 1991 to 11.8% in the year 2000. (Okuneye 2000). These problems are the bedrock/foundation for food insecurity in Nigeria. Nigeria presently spends thongs of money on imported food in-spite of the massive uncultivated land across the nation.

The Executive Secretary, Agricultural Research Council of Nigeria, ARCN, Prof. Baba Abubakar, stated that “Nigeria spends over N1 trillion on the top four food imports annually. And farmers have limited capacity and use techniques that adversely affect soil fertility, water and biodiversity. Human-induced climate change compounds the issue.” According to him, Nigeria is the largest importer of US hard red and white wheat worth N635 billion; the world number 2 importer of Rice at N356 billion; N217 billion on sugar and N97 billion on fish. This shows that Nigeria is presently not capable of producing enough food for the nation and relying on food imports will have an adverse effect on economic growth. The major problems of food production in the agricultural sector is lack of capital and technology. Technological improvement increases output and production both in agriculture and industrial sector. Manufacturing and processing of foods like sugar, rice, milk, etc. in large quantity also need a huge amount of capital and credit facilities and new techniques. Most Nigerians interested in agriculture do not have access to these facilities.


1.3 Research Questions

In order to examine the effect of food security on economic growth in Nigeria, the following research questions are raised.

  1. Is there any significant relationship between food security and economic growth?
  2. Is there any long run effect between food security and economic growth?

1.4 Objective of the Study

The broad objective of the study is to evaluate the effect of Food security on economic growth.

Specific objectives of this study are:

  1. To examine the short run relationship between economic growth and food security
  2. To investigate the long run relationship between economic growth and food security
  3. To examine the causal relationship between economic growth and food security

1.5 Research Hypothesis

The null hypothesis (H0) will be tested against the alternative hypothesis (H1), therefore making it possible to either accept the null hypothesis or reject it in favour of the alternative.

  • Null hypothesis (H0): there is no significant relationship between economic growth and food security in Nigeria.
  • Alternative hypothesis (H1): there is significant positive relationship between economic growth and food security in Nigeria.

1.6 Significance of the Study

Theoretically, this study shows the trend of knowledge relating to food security and with the help of its findings may be able to proffer possible solutions to the current state of food insecurity in Nigeria. The study further unveils the challenges militating against food security in Nigeria and provides various recommendations and possible solutions against food insecurity. The study is aimed at evaluating the concept of food Security and how it affects economic growth.

Empirically, this study serve as a foundation to researchers who in the course of time would like to go through research relating to food security and Economic growth. In a nutshell, this study would serve as a valuable bibliographical reference for other research work and investigations as regards to this study.


1.7 Scope and Limitation of the Study

This study focuses on the evaluation of the effect of Food security on Economic growth in Nigeria from 1970-2013.

The data used for this study is obtained from the World Development Indicators, CBN statistical bulletin, International Food Policy Research Institute (IFPRI), journals, etc.

However, a study of this magnitude would possibly encounter certain limitations and constraints. One major limitation is the effort to trim the work into a simple and sensible volume despite the broad nature of the study.

Also, in getting valuable materials, some information are said to be restricted hence, the researcher seeks other information through the use of internet materials, text books, journals etc.


Chapter Five


Conclusion and Policy Recommendation

5.1 Conclusion

This work examined the effect of food security on economic growth using the auto-regressive lag (ARDL) model. The objective of this work is to analyze the causal relationship between economic growth and food security and also to analyze the long and short run effect between them. In order to achieve the stated objectives, the unit root test was used to check for stationarity, granger causality test was used to analyze the causal relationship. The auto- regressive distributed lag (ARDL) was used to test the short run effect and the long run effect was examined through the ARDL bound test.

The granger causality test shows that there is a causal relationship between food production index (FPI) and per capital income (PCI). This shows a unidirectional relationship, that is, FPI granger causes PCI.

The results from auto-regressive distributed lag (ARDL) shows that there is no short run relationship between the variables but a long run relationship exist between the variables using GDP as dependent variable.

Based on discoveries made, it can be noted that food production which is a major determinant of food security affects per capita income in the country, also food security has a significant impact on economic growth in the long run. Hence, it can be concluded that there is need for government intervention in the pursuit of food security, to increase food productivity in the agricultural sector to stimulate sustainable economic growth.


5.2 Recommendation

Based on the findings the following recommendations are suggested

The government should focus on formulating long run policies to enhance food productivity. Pro poor policies should be designed to terminate poverty and this should focus on diversifying the Nigerian economy with agriculture as the driver of the economy.

The government should make provision for adequate supply of technology to enhance food productivity.

Government should subsidize machineries and other important technologies for agricultural productivity thereby encouraging the private sector to go into mechanized farming.

The government should strengthen agricultural research institutes with sufficient funds. This will improve domestic techniques in agricultural productivity.

The government should also enforce import substitution on food production. Food importation should be restricted and the central bank should create policies that would favour the supply of money towards food production.

There is need for sincerity of purpose and consistency with programmes and policies. It is adviced that all leaders stick to the same programmes and policies, this would go a long way to avoid wastage of resources, enhance food security as well as economic growth.


Food Security; A Means To Sustainable Economic Growth


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