CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
Agriculture is still regarded as one of the mainstays of the Nigerian economy, before and after independence with the production of food for the vast teaming popula
...
CHAPTER ONE
INTRODUCTION
1.1 Background of the Study
Agriculture is still regarded as one of the mainstays of the Nigerian economy, before and after independence with the production of food for the vast teaming population. It contributes immensely to the production of raw materials which has translated into increased foreign exchange earnings, better social life, and higher standard of living of people. Therefore, wise nations all over the globe make agriculture a priority by developing and exploiting this sector for the survival of the nation. This is done by formulating policies by the government of different countries, this is in line with the fact that agricultural financing to the national economy cannot be overemphasized because of its relevance in stemming hunger and assuring food security, reducing unemployment, solving balance of payment problem and increasing GDP. (Inyang-Akpan, 2005).
The term agriculture is derived from the Latin word “Ager” (field) and “cultural” (cultivation). This means field cultivation. This is not a complete definition of agriculture since agriculture has to do with animal production. Therefore, agriculture can be defined as the art and science of cultivating the soil, producing livestock, preparing livestock feed, processing crops, and livestock products for man, and the process of selling excess crops and livestock. Agriculture may also mean just the production of crops, rearing of animals, and general management of the soil.
Agriculture also involves the science of preparing the soil for the production of crops and the rearing of animals for human use. It also embraces various preparations and processing of plant and animal products as well as the disposals of these products through marketing (Cheghu 2004) observed that the sector generates employment for the teeming population over the years, the agricultural production has witnessed a drastic decline in productivity.
3
Recently, due to the current decline in the world oil market price and economic downturn which has also affected the oil sector in Nigeria; there is a realization of the importance of the agricultural sector to get its former pride of place. The general impression about the agricultural sector opined those local farmers carry out small-scale operations characterized by low productivity and low income due to their capital formation. Ekpebu (2006) posited that the performance of the agricultural sector has been unsatisfying over the years due to insufficient funding or credit facility, inadequate infrastructural facilities, low technology base, high cost of farm inputs, and inadequate extension services.
Trzeciak-Duval (2003) opined that agriculture like all other sectors of the economy needs credit for its development. But the inadequacy and death of credit for financing agriculture are one of the greatest problems facing agricultural development in most developing countries like Nigeria (Oyewale and Oloko, 2002) while Akubuilo (2002) added that inadequacy of loans and credit services is among the constraints against effective farming among rural farmers. The inability to purchase the modern requisites needs to be supplied with loans from banks and other credit facilities which will be used to increase production. These facts have often led the Nigerian government to promote and support the supply of credits (loans) to farmers and make loan acquisition easy enough for farmers hence, enhance or increase agricultural productivity at a large scale.
[Show More]
