Investments into the Nigerian agriculture sector declined by 83 percent to $10.0 million in the second quarter of 2023, as against $57.41 million recorded in Q2 2022.
According to the latest Capital Importation report from the National Bureau of Statistics (NBS), the agriculture sector accounted for a 0.97 percent share of the $1.03 billion foreign direct investment into the country from April through June 2023.
On a quarter-on-quarter basis, investment into the sector surged 107 percent to $10 million in Q2 2023 from $4.84 million in the first quarter of 2023.
The fishing subsector of the agricultural sector did not attract any investment from the period.
Due to the economic downturn, investment in Nigeria generally has been declining. Investments into the Nigerian economy declined by 33 percent to $1.03 billion in the second quarter of 2023, as against $1.535 billion recorded in Q2 2022, and 9 percent when compared to $1.132 billion recorded in Q1 2023.
“In terms of share to the GDP, agriculture and the industry sectors contributed less to the aggregate GDP in the second quarter of 2023 compared to the second quarter of 2022,” the NBS said in its Q2 GDP report.
The agriculture sector has suffered a spate of shocks in recent times. And, the inability of farmers to feel safe going to their farms has further affected food security and food prices in Nigeria.
“The government needs to create the enabling environment and address the worsening rate of insecurity to attract more investments into the sector,” Abiodun Olorondenro, operation manager at Aquashoots Limited said.
The sector is also seeing its profits harmed by rise in major inputs. This coupled with issues of insecurity and climate change is making it even harder for many farmers to make profit, as well as deterring future investments.
“There are a lot of shocks that have impacted the sector for a while, and this might have also impacted the level of investments attracted,” AfricanFarmer Mogaji, chief executive officer of X-Ray Consulting, said in response to questions.
Also, the protracted cash shortage, triggered by the replacement of the highest denominations of the country’s currency, hobbled the economy, especially the informal sector.