IMPACT OF AGRICULTURAL EXPENDITURE ON AGRICULTURAL OUTPUT AND ECONOMIC GROWTH IN NIGERIA

IMPACT OF AGRICULTURAL EXPENDITURE ON AGRICULTURAL OUTPUT AND ECONOMIC GROWTH IN NIGERIA
CHAPTER
ONE
INTRODUCTION
The role of agriculture in economic growth and
development in any nation is crucial and it is a sign of prosperity and
development. Agriculture, in whatever form it comes or exists-food and cash
crops production, livestock, poultry, animal husbandry, hunting and
Horticulture. The roles to play in any Nations Economic  growth and devolvement is crucial.
These roles include sources of food for the growing
population, raw materials for the manufacturing sectors, reduction of
inflationary pressure, earner of foreign exchange, labour force empowerment,
source of income and savings for the farmers, improvement in their living
standards and market for products of the manufacturing sector. (Jhingan, 1975)
But, unfortunately for Nigeria as a developing
Nation, these roles are hardly met by the Agricultural sector because of the
internal and external factors facing farmers in Nigeria. A catalogue of reasons
have been advanced for the relative poor performance of Nigeria’s agricultural
sector. include inadequate public agricultural expenditure, over dependence on
crude oil revenue, rural-urban migration, inadequate processing and storage
capacity, smallness of farm holdings, ageing population, use of inefficient
traditional technology, inadequate agricultural extension services, policy
inconsistency and increasing population pressure etc.
In an attempt to solve these problems of
agricultural sector, the Federal and State governments of Nigeria intervene
through some agricultural policies and programmes. Notable among the these
policies are the operation field the Nation (OFN), the Green revolution (GR),
land use degree, fertilizer company of Nigeria (NAFCON) and the National
Agriculture land development authority (NALDA) and the latest is the
agriculture development project (ADP). Meanwhile, these policies have not
helped much in improving significantly the agricultural sector as the costs
involved are still more than the benefits realized.
Perhaps, for the impact of public expenditure,
surplus public agricultural expenditure allocation on the sector itself in
Nigeria, is to be more effective, efficient workable and successful in some of
these agricultural policies.
Statement
of the Problem
The agricultural sector has been affected with
numerous problems which has been the result of the poor performance of the
sector itself.
This has attracted various strategies including
expansion of public expenditure on agricultural activities. Overtime this
expenditure has been on the increase without expressly translating to a corresponding
expansion in agricultural output. The average total annual on the increase ober
the years
Total annual expenditure on agriculture increased on
the average from N0.02billion in the 1981- 1986 periods through an average of
N0.2 billion per annum in 1987 – 1992 to Average total annual expenditure on
agriculture, has been on the increase over the years. Total annual expenditure
on agriculture increased on the average from N0.02 billion in the
1981-1986periods through an average of N0.2 billion perannum in 1987-1992 to
N1.84 billion in 1993-1998 periods. Total annual expenditure onagriculture
increased significantly on the average (1999-2006) to N16.97 billion and
further toN37.13 billion during the Late President Umar
Yar’adua’s
administration, but fell to N36.19billion during President Goodluck Jonathan’s
administration (2011-2014).
 Despite these
huge sums of money allocated to the sector overthe years, the state of
agriculture in Nigeria stillremains poor and largely underdeveloped.
Agricultural
sector output has fluctuated widely and productivity has also declined. In
terms of contribution to GDP, available statistics from the CBN shows that the
agricultural sector’s share of GDP increased from 28% in 1985 to 32% in1988,
dropped to 31% in 1989, rose to 37% in1990 but fell significantly to 24% in
1992, it increased again to 37% in1994. It was 32% in1996 and rose to 40% in
1998, dropped again to27% in 2000, increased to 37% and fell to 31% in2002 and
2006 respectively. The per centage contribution of the agricultural sector to
GDP fell persistently from 0.37 in 2009 to 0.22 in 2012 and to 0.20 in 2014.
The poor state of the sector has been blamed on oil
glut and its consequences on several occasions, as this pattern was not an
outcome of increased productivity in the non-agricultural sectors as expected
of the industrialization process; rather it was the result of low productivity
due to negligence of the agriculture sector
The
question that comes to mind are
What
is the impact of public agricultural expenditure on agriculture expenditure on
agricultural output growth in Nigeria
What is the impact of
agricultural public expenditure on economic growth in Nigeria
To what extent does
bank loan contribute to the development of agriculture
Does agriculture output
contribute to Nigeria economic growth?
Objective of the study
The overall objective of this study is to determine
how agricultyral public expendityre can improve agricultural output
However, the specific objective are as follows
1.     To
determine the impact of agricultural public expenditure on agricultural output
2.     To
determine if bank loan contribute to the development of agriculture in Nigeria
3.     To
determine if agricultural output contribute to the development of economic
growth
Hypothesis of the study
The
hypothesis tested in this study are as follows.
Ho.
Agricultural public expenditure has no significant impact on agricultural
output
H1:
Agricultural public expenditure has significant impact on agricultural output
Significant of the study
Once regarded as the mainstary of the economy and
also the provider of employment food and foreign exchange thus, adequate public
agriculture expenditure on the agricultural sector is significant
This study is intended to determine the trends of
agricultural public expenditure on agricultural output in  Nigeria in order to ensure food security and
to reduce poverty in the economics
This study will also show the impact of public
agricultural expenditure on the economic growth of Nigeria over time. The
result of the study will be of great benefit to the federal republic of Nigeria
because economic growth is the vehicle of development. Development is the
sustained elevation of an entire society and social activities towards a better
and more human life.
The result of this study will be significant in the
following ways:
1. It will help the Nigerian government
and her policy makers to restore fiscal  
   
Discipline in Nigeria.
2. The study will be important in debt
management in Nigeria.
3. It will also have implications for
formulating a workable model.
Scope And Limitation Of The Study
This study covers the period of 1981-2014, a period
of thirty-three years; basically this research focuses on the trend of public
agricultural expenditure and some contributions of agriculture to the economy
itself (GDP).
The scope also comprises of some inherent problem
facing the agricultural sector, its prospects and policy recommendation to
attain a high level of productivity.
There is also lack of strong evidendce in the
theoretical framework of this topic that would have provided a reliable
foundation for us to stem from a particular nigeriam case. There is also the
limitation of the small sample size which has its attended drawbacks
The dearth of required statistics and limited access
to literature, some journals and publications which could have been of immense
help to this work were unavailable. 
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