Nigeria Needs Trade as Much as it Needs Food

The United Nations (UN) has called for $5.6 billion in donations to fight a famine that threatens over 20 million people in Nigeria, South Sudan, Somalia, and Yemen. In Nigeria alone, upwards of 5 million people face acute food shortages.

In a country of over 170 billion people, there are fewer than 5,000 tractors.

Considering the progress Nigeria has made in food security since the 1980s, the country’s placement on the list is disheartening. While the UN’s efforts might bring temporary relief, the root causes of this famine must be addressed to prevent similar crises in the future. Boko Haram might be partly responsible for this crisis, but the reality is that Nigeria’s famine is worsened by protectionist policies that restrict agricultural trade and force Nigerians to depend on insufficient domestic food production.

Restricted Food Imports

In 1983, Nigeria averaged less than 2,000 calories per person per day. By 1998, Nigeria had caught up to the global average of over 2,630 calories. However, food production has dropped in recent years because Nigerian agriculture is stuck in the past. In a country of over 170 billion people, there are fewer than 5,000 tractors. Traditional small scale farming permeates the food production In Nigeria. Small plots a couple of hectares in size account for 90 percent of domestic food production. With a growing population, such small-scale production has become insufficient.

President Buhari restricted foreign exchange access for 41 goods and services, including wheat and rice.

This lack of technological development has adversely impacted Nigerian farmers’ competitiveness against other producers, as shown by the Revealed Comparative Advantage (RCA) Index. The RCA provides scores to determine each country’s comparative advantages in a certain classes of goods or services. RCA scores between 0-1 show disadvantages, while scores above 1 show advantages. Per the RCA scores, Nigeria has a competitive disadvantage in every category of food production, with scores ranging from 0.21- 0.58. This would not be a big problem if the government allowed for more food imports. However, this is not the case.

According to the Brookings Institute, Nigeria imposes high tariff rates and protectionist policies with the intent of protecting domestic industries, including the agriculture sector. As of 2014, import tariffs ranked second, behind oil and gas, in their contributions towards government revenue. In an attempt to keep high value foreign currency within the country, President Buhari restricted foreign exchange access for 41 goods and services, including wheat and rice.

In 2016 the import tariff on wheat was 5 percent plus a 15 percent levy, and flour products were banned from import. More strikingly, wheat tariffs are low compared to the 30 to 50 percent tariff placed on rice products. These tariffs work to artificially increase the price of food for Nigerians, while doing nothing to make domestic agriculture more competitive. The lack of competitive production combined with low imports has created a system where domestic food consumption is directly linked to food production. This increases Nigerian vulnerability to environmental factors such as drought, floods, or violence.

Violence and Burning Farms

Protectionist policies and nationalist mentalities all mean very little when plates and bellies are empty and children are dying.

To further complicate matters, since 2015, the insurgent group Boko Haram has displaced over 2 million people, including farmers, and worse, it is a common practice to burn farms as they pillage regions. Expecting domestic production to feed Nigerians in peaceful times is ignorantly optimistic, expecting them to do so when farmers are displaced and crops destroyed is insanity.  

In a violence-torn country, placing hope in their domestic, archaic agriculture sector is not a recipe for success.

Self-reliance on domestically produced food is a pipe dream for Nigeria. If the government wants to help their citizens, they must repeal harmful trade policies that drive up the cost of food. Domestic production has failed to meet local demands, as evident by the ongoing famine.

Within the next couple months, 75,000 Nigerian children could die as a result of the famine. Protectionist policies and nationalist mentalities all mean very little when plates and bellies are empty and children are dying. The continuation of import limitation and bans will do nothing but hurt the Nigerian people further.

It may be too late to prevent this famine, but changing current policies can still bring relief. By learning from past mistakes, future Nigerians can hopefully avoid a repeat of history.

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