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IMPACT OF AGRICULTURAL PRODUCTIVITY ON ECONOMIC GROWTH OF WEST AFRICAN REGION

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IMPACT OF AGRICULTURAL PRODUCTIVITY ON ECONOMIC GROWTH OF WEST AFRICAN REGION

INTRODUCTION

 1.1 Background to the Study

Africa is blessed with huge physical, human and natural resource endowments yet the majority of its population live below both the absolute and relative poverty lines.   However, the most current Human Development Report by the United Nations Development Programme (UNDP, 2009) shows that about 64.4 and 83.7 percent of the population lives below $1.25 and $2 a day, respectively. This poverty situation is worse in the rural areas where over 70 percent of the people reside and earn their living through agriculture than in the urban areas.  This invariably leaves agriculture as a key sector capable of affecting majority of Africans in diverse ways. Therefore, the persistence of hunger and poverty in Africa must be, to a large extent, the failure of the agricultural sector to fully impact positively on the people.

 

Agriculture plays a cardinal role in Africa’s economy contributing the greatest share to most nation’s gross domestic production (GDP). For instance, 2008 Nigerians agriculture’s contribution to total real GDP was 42.07 percent with crop, livestock, forestry and fishery accounting for 37.52, 2.65, 1.37 and 0.53 percent, respectively (NBS, 2007; Central Bank of Nigeria (CBN), 2008). This implies that the crop sub-sector contributed 89.2 percent of agriculture GDP. Despite these indicators, Africa’s agricultural performance in recent times remains inadequate and indeed far less than its potentials.  Food demand exceeds the supply thus leading to large importations of food, which further erodes the economies foreign exchange. The growing food import over the years gave rise to escalating foreign exchange expenditures, which could have been invested in other areas of the economy. At the heart of this inadequacy of the sector lies the foremost problem of low productivity, as will be clarified later in this introduction. Low productivity in the country could be as a result of a number of factors, which may be direct or indirect.  With the fast increase in human population in the country, there is no doubt that resources are becoming scarcer than ever before and therefore development strategies should focus on strategies that are intended to increase the productivity of scarce resources.

 

Although small scale farmers dominate agricultural production in Africa and individually exert little influence, collectively they form the foundation upon which the economy rests. In west Africa, Ghana precisely,about 90 percent of its total total food production comes from small farms and at least 60 percent of the country’s population earns their living from these small farms with farm sizes generally less than 2 hectares (Oluwatayo et al. 2008). Unfortunately, these small scale farmers are subsistence farmers and use crude and traditional production techniques. This has contributed to the poor performance of the sector. Therefore, effective economic development strategy will depend critically on promoting productivity and output growth, particularly among small-scale producers since they make up the bulk of the nation’s agriculture. To boost the agricultural production base of any country, a number of policies have been put in place and these in a broad sense, include: (i) the achievement of self-sufficiency in basic food supply and the attainment of food security; (ii) increased production of agricultural raw materials for industries; (iii) increased production and processing of export crops, using improved production and processing technologies; (iv) generating gainful employment; (v) rational utilization of agricultural resources, improved protection of agricultural land resources from drought, desert encroachment, soil erosion and flood, and the general preservation of the environment for the sustainability of agricultural production; (vi) promotion of the increased application of modern technology to agricultural production and (vii) improvement in the quality of life of rural dwellers.

1.2 Statement of problem

According to Manyong et al. (2005) most African countries are endowed with a large deposit of agricultural resources and huge arable land for the cultivation of crops and rearing of animals. This agricultural sector holds an enormous potential for the growth and economic development of these countries.

In a similar study carried out by (Bekun, 2011) titled Economics of Yam Marketing in Africa. The study reveals that.  Regardless of vast potentials the agricultural sector possesses, the industry endowment has not been fully harnessed. decline in the agricultural sectors‟ contribution, this discovery has reveal the recent neglect of the agricultural sector and more focus on energy sector in most west African countries.

With the agricultural sector being so productive with arguably massive potential, why then has it been neglected?  The answer to this question prompts the motivation for this study.  Recent literature is attempting to estimate the relationship between the agricultural productivity and economic growth, do so using cross-sectional data.  We argue that this methodology is flawed in the sense that the relationship between the agricultural sector and economic growth is best captured over time.  Given the so few studies done using time-series data, there is a gap in explaining the real effect of the agricultural sector on economic growth in west Africa.  This gap is what this study aims to fill.

1.3 Objective of the Study

The primary purpose of this study is to investigate the impact of agricultural productivity on the economy’s growth of west African region. The specific objective of the study are thus:

To determine the if there is a significant impact of  agricultural output on the economic growth of west African region

To determine the nature of the relationship between agricultural output and the economic growth of west African region

To determine the various challenges facing the development of the agricultural sector and recommend solutions to this problems

 

1.4 Research questions

The research aim to answer the following pertinent questions:

Is the impact of agricultural output on the economic growth of west African region significant?

What nature of the relationship between agricultural output and the economic growth of West African region?

What are the various challenges facing the development of the agricultural sector in Africa?

1.5 Research Hypothesis

Ho: there is no is a significant impact of agricultural output on the economic growth of West African region

 

1.6 significance of the study

This study is motivated by the important position of agriculture in the African economy. Agriculture not only serves as an important food staple to a majority of the citizens of Africa but also a source of revenue to both farm households and the nation at large. Africa has a great potential for better economic growth both in the short and long run than is currently experienced through increased agriculture. To this end the study would contribute it will help the research and extension agents to know specifically the various problems faced by the agricultural sector and how best to ensure that their productivity As there is a dearth of empirical work explicitly linking efficiency and agricultural technologies, this study will therefore contribute to the existing literatures not simply by testing the difference in the mean efficiency of users and non-users of improved technologies but also by determining the direction and magnitude of impact of such adoption decisions on farmers’ technical, allocative and cost efficiency and also the sensitivity of such impact to different methodological approach.

 

1.7 scope of the study

This study employed the use of secondary data. It examines the impact of agricultural productivity on economic growth of west african region. The study uses four West African countries for its analysis they include: Sierra Leone, Gambia, Ghana, and Nigeria. The time frame for the data covers 1985 to 2017. The choice of the time frame is informed by the fact that this era witnessed the introduction of trade policy regimes and economic reforms such as the introduction of Structural Adjustment Programmes (SAP) in most countries (Ajakaiye and Oyejide, 2005; Akinkugbe, 2008).

 

1.8     Operational Definitions

Agricultural productivity: The output produced by a given level of input(s) in the agricultural sector of a given economy.  It is the ratio of the value of total farm outputs to the value of total inputs used in farm production.  

Food security: When all people at all times have access to sufficient, safe, nutritious food to maintain a healthy and active life.

 

Human Development Index (HDI): Is a summary measure for assessing long-term progress in three basic dimensions of human development: a long and healthy life, access to knowledge and a decent standard of living.

 

Poverty: The lack of basic needs and services such as food, clothing, beddings, shelter, basic health care, markets, education, information and communication.

 

Unemployment: All the individuals who are without work/jobs: they may either be in the process of moving to new jobs or actively seeking work. The unemployment rate is calculated as a percentage by dividing the number of unemployed individuals by all individuals currently in the labor force.