Nigeria, once an agricultural powerhouse, experienced a profound transformation following the discovery of oil in the late 1950s. Prior to oil exploitation, agriculture was the backbone of Nigeria’s economy, sustaining livelihoods, earning foreign exchange, and fostering rural development. Today, decades after oil became the dominant export, the sector faces persistent decline, with implications for food security, rural livelihoods, and economic diversification.
Pre-Oil Agricultural Dominance
Before oil revenues reshaped the Nigerian economy, agriculture was the primary source of employment and foreign exchange. In the early 1960s, agriculture accounted for more than 60% of GDP and employed over 70% of the population. Nigeria was a leading exporter of cocoa, groundnuts, palm oil, and rubber. These cash crops underpinned national revenue and supported vibrant rural economies.
The Oil Boom and Economic Shift
The commercial exploitation of oil in the late 1950s, followed by the global oil price surge in the 1970s, transformed Nigeria’s economic structure. Oil revenue became central to government budgets, accounting for over 90% of export earnings and more than 70% of government revenue by the 1980s.
This resource windfall contributed to “Dutch Disease”, a phenomenon where rapid growth in one sector (oil) crowds out others (agriculture, manufacturing) due to currency appreciation and shifting labour. Military regimes of the 1970s and 1980s prioritised oil-led development, infrastructure projects, and defence spending, often sidelining agriculture. Although budgets sometimes included allocations for agriculture, poor implementation and policy inconsistency hindered sectoral growth.
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Decline in Agricultural Productivity
The neglect of agriculture resulted in reduced productivity and declining export performance. Between the early 1970s and mid-1980s, output of major export crops declined significantly. Cocoa exports fell due to ageing farms, pest infestations, and insufficient investment in extension services. Groundnut and cotton production also suffered declines, forcing Nigeria to increasingly import staple foods such as rice and wheat.
By the 1980s, Nigeria’s dependence on food imports was entrenched, placing strain on foreign exchange reserves and undermining rural economies.
Environmental Degradation and Rural Displacement
The oil industry also caused environmental challenges, particularly in the Niger Delta. Oil spills, gas flaring, and deforestation disrupted farming and fishing livelihoods, leading to rural displacement. Communities dependent on land and fisheries for subsistence experienced declining productivity, soil degradation, and health hazards.
These environmental impacts deepened the neglect of rural agriculture and reinforced migration to urban areas.
Post-Oil Boom Challenges
Structural adjustment programmes in the 1980s and 1990s, driven by the IMF and World Bank, reduced subsidies for agricultural inputs, devalued the naira, and liberalised trade. While these reforms aimed to boost efficiency, they increased costs for farmers and eroded domestic production capacity. The continued reliance on oil revenues meant agriculture received limited prioritisation, contributing to food insecurity and rural poverty.
Contemporary Implications
Today, agriculture accounts for approximately 22% of Nigeria’s GDP and employs over 36% of the labour force, yet productivity remains low. Food insecurity affects over 30 million Nigerians, with climate change exacerbating challenges through irregular rainfall and soil degradation. Despite national diversification policies, oil remains the dominant economic driver, leaving agriculture undercapitalised and vulnerable.
Revitalising Nigeria’s agricultural sector requires sustained investment, environmental restoration in oil-producing regions, and effective policy implementation. Greater integration of technology and climate-resilient farming practices is essential to restore agriculture as a pillar of national growth.
The decline of agriculture in oil-rich Nigeria reflects a combination of economic shifts, governance choices, and environmental degradation. While oil has generated wealth and transformed Nigeria’s economy, it has also contributed to neglecting agriculture, with enduring implications for food security and rural livelihoods. Rebuilding the agricultural sector is critical for economic resilience, reducing dependency on oil, and ensuring sustainable development.
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Author’s Note
Nigeria’s transformation from an agricultural powerhouse to an oil-dependent economy has had lasting effects on rural livelihoods, food security, and economic diversification. Military-era policies, structural adjustment programmes, and environmental degradation deepened agriculture’s decline despite its historical importance.
Reviving Nigeria’s agricultural sector requires deliberate policy focus, sustainable environmental practices, investment in rural infrastructure, and leveraging technology for climate-resilient farming. Diversification beyond oil remains crucial to ensure long-term economic stability and food security.
References
- World Bank. Nigeria Economic Report: Agriculture and Food Security. World Bank, 2019.
- Food and Agriculture Organization (FAO). Agriculture in Nigeria: Historical Trends and Future Prospects. FAO, 2020.
- Watts, M. Curse of the Black Gold: 50 Years of Oil in the Niger Delta. Ohio University Press, 2010.
