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A Reappraisal of Impact of Structural Adjustment Programme (SAP) on the Agricultural Sector of Nigeria: A Path-Analysis Approach

Ogebe, F. O.* and Ogah, M. O.

Department of Agricultural Economics, Federal University of Agriculture, Makurdi, Benue State, Nigeria

*Corresponding Author: +2347035945500


The oil boom of the 1970s transformed Nigeria from arelatively prosperous agrarianeconomy to a major exporter of petroleum products, consequently agricultural developmentwasalmost entirely neglected bypolicy makers. However, the slump in world pricesof petroleum products in the early 1980s emphasized the need for changes in economic policy in the nation. Thus, in 1986 the government introduced an International Monetary Fund (IMF) and World Bank assisted SAP aimed at diversifying the production baseof the nation by placing more emphasis on the non-oil export sector, especially agricultural export crops. This research applies a path analysis approach to examine the impact of SAP on agricultural production in Nigeria.  Thus, the study analyzed the effects of SAP on the agricultural sector and economy of Nigeria and recommends possible re-visit or otherwise of the SAP policy. The data for this study are from the files of the FAO covering the period 1970 to 1997. Multiple regression and path analysis are used to analyze the data. The results revealed that SAP had a positive impact on agricultural production, which in turns, had a positive impact on net agricultural exports, as well as positive impact on contribution of agriculture to GDP, which ultimately led to a positive impact in real GDP growth rate. The study concluded that overall, SAP is beneficial to the Nigerian agricultural sector and the economy and therefore, a panacea for resuscitation of the agricultural sector in Nigeria. The findings suggested that Nigerian authorities should revisit the SAP policies in the agricultural sector since an improvement or growth of this sector ultimately influences growth of the overall economy. However, the study recommends the need to strengthen the exchange rate reform with policies that enhance the country’s trade management and competitiveness. More so, there is need to be more flexible so as to provide automatic stabilizers that will negate the unforeseen adverse consequences of policy management process.

Keywords: Structural adjustment, path-analysis, agricultural production, Nigeria

How to Cite this Article:

Ogebe, F. O. & Ogah, M. O. (2020). A Reappraisal of Impact of Structural Adjustment Programme (SAP) on the Agricultural Sector of Nigeria: A Path-Analysis Approach. VillageMath Educational Review (VER), 1(1), 26-37.