International J. Soc. Sci. & Education
2012 Vol. 2 Issue 4, ISSN: 2223-4934 E and 2227-393X Print
An Empirical Analysis of the Contribution of Agriculture and Petroleum Sector to the Growth and Development of the
Nigerian Economy from 1960-2010
Aminu Umaru and 2Anono Abdulrahman Zubairu
Department of Economics & 2Department of Management Technology School of Management and Information Technology
Modibbo Adama University of Technology, Yola, Adamawa State, Nigeria.
This paper investigates the contribution of agricultural sector and petroleum sector to the economic growth and development (GDP) of the Nigerian economy between 1960 and 2010 through the application of Augmented DickeyFuller technique in testing the unit root property of the series; after which Chow breakpoint test was conducted to test the presence of structural change or break in the economy. The results of unit root suggest that all the variables in the model are stationary and the results of Chow breakpoint test suggest that there is no structural change or break in the period under review. The results also revealed that agricultural sector is contributing higher than the petroleum sector, though they both possessed a positive impact on economic growth and development of the economy. A good performance of an economy in terms of per capita growth may therefore be attributed to a welldeveloped agricultural sector capital. A major policy implication of this result is that concerted effort be made by policy makers to increase the level of productivity of agricultural sector in Nigeria by improving expenditure on the sector so as to boost the growth of the economy. Since the agricultural sector is the major contributor to GDP in Nigeria which is capable of changing social indictors of the economy, policies aimed at adequate financing of agricultural sector by government in order to boast its output, may result into a way forward. Government evolves policies toward diversifying the economy and encouraged the campaign for improvements in the non-oil sectors of the economy especially agricultural.
Keywords: Contribution of Agriculture, Petroleum and GDP growth and the Nigerian economy
Agriculture and petroleum sectors are the key sectors in the Nigerian economy. These sectors are the ‘brain box’ of the Nigerian economy. Agricultural sector is vital source of raw materials needed for the agro allied industries, especially Beverages Company, food and exports. It was the cornerstone of the economy in the 1960s and early 1970s.
Nigeria was heavily dependent on agriculture, which was the sector accounting for more than 40 percent of the Pre-1973 GDP. It was the major source of funds for implementing the first development plan, 1962-1968. Within a decade up to 1983 however, agricultural output in Nigeria declined to 1.9 percent and export fell to 7.9 percent. Agricultural imports as a share of the total imports rose from 3 percent in the late 1960s to 7 percent in the early 1980s. Nigeria’s unfavorable agricultural development resulted from the loss of compositeness among farm exports as the real values of the Nigerian Naira appreciated substantially from 1970 to 1972 and from 1982 to 1983. According to the Central Bank of Nigeria report, “export-oriented agriculture declined from 42 per cent of the total export in 1970 to less than 3 per cent in 1985.”
Aminu Umaru and Anono Abdulrahman Zubairu
The sector has suffered from years of mismanagement, and inconsistency in the government policies and the era of huge oil revenues has also contributed in the neglect of the agricultural sector. Major agricultural products are Cassava, corn, millet, cocoa, palm oil, groundnuts, rice, rubber, sorghum, yam, and livestock production. The sector still accounts for over 26.8percent of GDP and two thirds of employments. Nigerian is no longer a major exporter of cocoa, cotton, groundnuts, rubber and palm oil. The...
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