Agriculture
contributed 41.84 percent to Nigeria’s GDP in 2009, and employs about 70percent
of its workforce. Investing in profitable, high growth and sustainable
agribusiness in Nigeria is seen as a way to drive youth employment.
Nigeria
is blessed with an agriculture friendly climate, coastal and marine resources
of over 960 kilometres of shoreline, expansive rivers and lakes covering
120,000 square kilometres and a large consumer market.
“The
potential for growth is quite remarkable and agriculture, in itself, is a major
contributor to the national Gross Domestic Product. Research shows that Nigeria
has over 80 million hectares of arable land. This accounts for about 23 percent
of arable land across all of West Africa. Thus, in terms of production, the
potential for West Africa to leap forward is immense as the region possesses
not only land, but the lowest levels of irrigation in the world,” said Kola
Masha, Managing director, Doreo Partners.
He
also noted that
having some of the fastest growing yields in the world is also
a plus for the region. Nigeria’s soya bean yield grows five times more rapidly
than the world average.
This
also makes for a significant boost in production.
The
key to unlocking the growth potential of Agriculture in Africa is to empower
small holders of farmers who have access to millions of hectares which would
ensure that they have access to appropriate inputs, sufficient financing
amongst others that will significantly boost productivity, he adds.
“Capturing
this potential would require a four-pronged approach: boosting yields, shifting
more production into high value crops, reducing post-harvest and distribution
losses, and increasing scale production. The biggest opportunity in agriculture
is improving crop yields, which accounts for 39 per cent of the upside
potential. Rice yield in Nigeria today are only 71 per cent of South African
levels and 36 per cent of Brazil’s. Cassava yields are half Indian levels. We
believe yields could reach approximately half their ecological potentials
(based on soil and climate types, as determined by the UN Food and Agriculture
Organisation), rising by around 40 per cent on average and creating overall
value of $45 billion per year by 2030,”
according to the McKinsey Global Institute (MGI) report.
Trade
Trade
accounts for 17 percent of Nigeria’s GDP and 25 percent of employment and has
been the largest driver of growth in Nigeria over the past decade, according to
the National Bureau of Statistic (NBS). This sector includes both retail trade
and wholesale trade.
According
to the MGI global report on Nigeria renewal: delivering inclusive growth,
consumption was projected to triple more than before, rising to almost $1.4
trillion in 2030, which shows an annual increase of 8 percent. This would make
trade the largest sector of the economy.
The
Trade sector will also provide opportunities for makers of packaged foods and
fast moving consumer goods (FMGC), which could grow by more than 10 percent
yearly.
Infrastructure
Infrastructure
is a major enabler of growth in developed and emerging economies. The value of
a nation’s core infrastructure such as roads, railways, ports, airports,
telecommunications and the electrical system represents about 68 percent of
their GDP, but in Nigeria it is only about 39 percent, according to the MGI
report.
The
Nigerian Government is, however keenly aware that rebuilding and maintaining
infrastructure is necessary for the country to attract foreign investment and
have implemented various improvement measures in order to reach its goal of
being one of the world’s 20 largest economies by 2020.
The
MGI report also stated that total infrastructure investment in Nigeria could
reach $1.5 trillion from 2014 to 2030 which will make building infrastructure
not only a major contributor to GDP but also an enabler of growth across the
economy.
Oil and gas
Oil
and gas exports account for more than 95 percent of Nigeria’s export earnings.
The country’s proven oil reserves are estimated at between 16 and 22 billion
barrels while some sources claim there could be as much as 35.3 billion
barrels. Most of Nigeria’s oil is found in the Niger Delta region.
Nigeria
is the world’s tenth most petroleum rich nation. Nigeria is also rich in natural gas reserves.
The industry is dominated by the Nigerian Liquefied Natural Gas Company (NLNG),
a joint venture between several companies and the state.
The
area has lately witnessed many kidnappings and acts of violence, but the
federal government has taken steps to resolve the security situation.
The
Nigerian National Petroleum Corporation (NNPC) has said that in addition to
Nigeria’s proven natural gas reserves of 182 trillion cubic feet (TCF), about
600 thousand cubic feet of undiscovered gas potential is still available for
her to tap from.
NNPC
said that with such gas potential available in Nigeria, the country’s hydrocarbon
industry would remain competitive despite new hydrocarbon discoveries in
Sub-Saharan African countries like Mozambique.
Manufacturing
The
Manufacturing sector enables large scale industrialisation and moves
agricultural workers into more productive activities. It helps economies
diversify and allows resource rich economies to become less resource dependent
and create more relatively high paying jobs.
Poor
infrastructure and epileptic power supply are the key impediments to the
manufacturing industry in Nigeria.
Though
growing rapidly, Manufacturing in Nigeria contributed just $35 billion to the
economy in 2013, or about 7 percent of GDP. If Nigeria could match the
performance of nations such as Malaysia and Thailand when their manufacturing
sectors were expanding rapidly, output could reach $144 billion a year in 2030.
BusinessDay
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