Agriculture and exports have been identified as major sectors capable of helping Nigeria diversify its economy and reduce its dependence on crude oil.
The Chief Executive Officer of FirstBank, Alebiosu, made the observation as the country continues to seek sustainable ways to strengthen economic growth, increase foreign exchange earnings and create more opportunities for businesses and households.
For decades, Nigeria’s economy has relied heavily on crude oil for government revenue and foreign exchange.
While the petroleum sector remains important, fluctuations in global oil prices and production challenges have continued to expose the country to economic shocks.
The need to develop other productive sectors has therefore become increasingly important.
Agriculture is one of the sectors with the capacity to support this transition because of its strong connection to employment, food production, manufacturing and exports.
Nigeria has a large agricultural base and produces several commodities that are demanded locally and internationally.
However, the sector still faces challenges that limit its ability to generate greater economic value.
These include inadequate infrastructure, limited access to affordable financing, poor storage facilities, inefficient transportation and low levels of mechanisation.
Addressing these challenges could significantly improve agricultural productivity and create stronger links between farmers, processors, manufacturers and exporters.
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One of the biggest opportunities lies in processing agricultural products locally before they are exported.
Rather than exporting commodities in their raw form, Nigeria can earn more by developing industries that transform them into finished or semi-finished products.
Cocoa, cashew, sesame, ginger, soybeans, rubber and other agricultural commodities offer opportunities for greater value addition.
For instance, processing cocoa locally can create additional products and businesses instead of limiting export earnings to raw cocoa beans.
The same approach can be applied across several agricultural value chains.
Local processing would also create employment and increase demand for transportation, packaging, logistics, equipment and other supporting services.
It could further strengthen manufacturing by providing industries with locally produced raw materials.
Exports are equally important because they provide an opportunity for Nigeria to earn foreign exchange from its productive sectors.
A stronger export base would reduce the country’s dependence on crude oil as the main source of external earnings.
It could also help businesses expand beyond the Nigerian market and take advantage of opportunities across Africa and other international markets.
The African Continental Free Trade Area offers Nigerian businesses access to a much larger regional market.
However, access to markets alone will not guarantee export success.
Nigerian products must be competitive in terms of price, quality, packaging and consistency.
This means businesses need reliable electricity, efficient transportation, modern equipment and access to affordable working capital.
Farmers also need better access to inputs, technology, irrigation and extension services.
Storage remains another major concern.
When farmers cannot properly preserve their harvest, they may be forced to sell quickly, sometimes at low prices.
Improved storage and processing facilities can reduce such losses while giving farmers more options when deciding when and where to sell their produce.
Financial institutions can also play an important role in this process.
Banks can provide financing for farmers, processors, exporters and other businesses operating within agricultural value chains.
Trade finance and other financial services can help companies purchase equipment, manage inventories and fulfil international orders.
However, financing must be supported by an environment that makes agricultural investment commercially sustainable.
Government policies, infrastructure and regulations will remain important to achieving this.
Nigeria must also improve the ease of moving agricultural products from farms to processing centres and export terminals.
Poor roads, delays at ports and inefficient logistics can increase costs and make Nigerian products less competitive internationally.
Reducing these barriers would allow businesses to operate more efficiently and improve their ability to compete with producers from other countries.
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The diversification of Nigeria’s economy should therefore go beyond simply identifying agriculture as an alternative to oil.
The focus should be on building complete value chains that connect production with processing, manufacturing and exports.
This approach could generate greater economic activity and ensure that more of the value created from Nigeria’s natural resources remains within the country.
Agriculture can also provide opportunities for young Nigerians beyond traditional farming.
Modern agribusiness requires professionals in technology, marketing, logistics, finance, processing, research and supply-chain management.
Developing these areas could create new employment opportunities while encouraging young entrepreneurs to participate in the sector.
Nigeria’s large population provides another advantage.
The country has a substantial domestic market for food and consumer products, giving local businesses an opportunity to grow before expanding into international markets.
If companies can successfully meet domestic demand while maintaining international standards, they can gradually build stronger export businesses.
The challenge is ensuring that Nigeria’s agricultural potential is converted into measurable economic output.
The country already has land, labour, entrepreneurs and a large consumer market.
What is required is greater investment, better infrastructure, stronger value chains and policies that encourage long-term private-sector participation.
The emphasis on agriculture and exports therefore comes at an important point in Nigeria’s economic development.
As the country works to strengthen its economy and reduce vulnerabilities linked to oil dependence, agriculture can serve as both a source of domestic production and a pathway to international markets.
The objective should not simply be to produce more agricultural commodities.
Nigeria must aim to produce, process, package and export more products from its own value chains.
That would allow the country to create more jobs, increase foreign exchange earnings, support local industries and strengthen its position in global trade.
If these opportunities are properly developed, agriculture and exports could become important pillars of Nigeria’s next phase of economic diversification.
