ABSTRACT
This project is an attempt to examine
the ROLE OF FINANCIAL INSTITUTION IN AGRICULTURAL DEVELOPMENT in Nigeria with particular reference to Nigeria agricultural and co- operative bank Enugu. And to suggest ways
by which they can be of better use to the nations. The project also made
desperate attempt to get the view of some farmers.
Chapter one consists of the general introduction of the research topic,
the statement of problems, the purpose of the research, and the methodology.
Chapter two, is the review of relevant and
related literature is treated under such topic
Chapter three consists of research
design and methodology, sources of data, location of data and method of data
collection.
CHAPTER
ONE
1.0 INTRODUCTION
1.1 BACKGROUND.
Agricultural is one of the most
important sectors of our country’s economy. Enugu state is no exception. Enugu state, characterized by low farm
incomes, primitive farming techniques which lower the level of production, and
low level of capacity to satisfy the food and fiber need of the nation. Infant
agricultural is in a part-type pf peascont agricultural which has been
mentioned by many writers as caught in a vicious circle of property low income
resulting to poor savings and little investment, because technology is poor,
out put is always low and income yield is low. Generally agriculture in Nigeria is
caught as a low level equilibrium trap.
The nature of technology is use always affects
the rate of return; i.e. the rate of return cannot rise because of poor
technology in use. This also as a result of poor financing, such agriculture
has been described as efficient but poor. In order to alleviate the numerous
problems being encountered by farmers and the economics loss suffered both
individual farmers and government in the international and local trade
transactions, then government decided to finance most of the agricultural
projects limited by individual farmers, co-operatives and institution.
Prior to 1976, the attention paid to agriculture by successive
government was not anything to write home about. Farmers were not earned for
pushed to the background and they weren’t introduced into the use of modern
scientific method of farming which would have help them a lot to boost
agricultural production. It was during the obasanjo leadership that alteration
was beginning to be given to agriculture with the introduction of operation
feed the nation (OFN). Then the idea was that of the bulk of producing food for
the nation was left with the farmers alone, we might not achieve best result
but the idea behind (OFN) was that all Nigerian should join hands together and
produce for our ourselves and the nation in general. Ever since then,
successive government have followed with different programs all aiming
developing products.
The evidence is that the establishment of Nigeria agricultural and
co-operatives bank ( NACB) ltd which is an apex development financial
institutions set up to external agricultural credit to the agricultural and agro-alhed
sectors of the Nigeria economy, this government has shown a great concern in
this wise. This is carried out through the provision of loans to liability
companies, state and federal government agencies.
1.2 STATEMENT OF PROBLEM
Many developing countries of the
world have very few financial facilities, considering the evolution of
financial market in Asia, latin America and Africa
countries, it was assented that new financial facilities are very much needed
to extend. Financial help especially in Nigeria. In supporting this
assertion, it was contended that at a certain stage in agricultural
development. Agricultural credit clearly does become a strong force for further
improvement, when a man with energy and initiative who lacks only the resources
for more and efficient production is enabled by the use of credit to eliminate
the block on his path to improvement.
Within the two capital markets ( institutional
and non-institutional) available to rural producers, the informal sources is
the most extensive suppler of cedit Nigeria yet this sources has not supplied
the amount of credit enough in terms of requirement by farmers to modernize
their farming methods
The problem of agricultural development is lack of finance and lack of
capital to be invested in the sector. Agricultural transformation plays a
centre role on the process of economic development and since past two (yrs)
decade productivity in the sector has been steadily declining.
The use of crude implement the use of crude and absolute implement is
still rampant. In most training practices, hoes, cutlasses etc., are
predominantly used as against sophiscated implements which encourage mass
production strorage preservation facilities- people in west Africa lack
adequate and modern preservative and storage facilities. A lot of crops are
wasted during the harvest first farmers are forced to sell their proceed, below
the cost of production because they can not afford to preserve them for a
longer period. The practice where by some crops are hung around the fire and
other kept in barns are not sufficient for the preservation and storage of
crops all year round
Land tenure system –this is the inability of the agricultural sector to
produce enough food both for man and machine lingers on the land fragmentation;
its acquired.
From the above problems these questions are identified.
1. Why has the government not been able
to salvage agriculture and place e it in its rightful position in the economy
in spite of its land able agricultural programmes
2. should the low level of institutional
credit be attributed to insufficient funds, ineffective supervision by monetary
authorities, politician interference etc,
The much deep needed investigation
and analysis into the role of financial institutions in agriculture development
in Nigeria
can be carried out with the entire above stated problem in view.
1.3 PURPOSE / OBJECTIVE OF STUDY
It can be identified in three ways
1. To identify the problems of
agriculture and its finance in Nigeria.
2. To asses the role of financial
institutions in assisting government solves the problems that may be
identified.
3. To propose solutions to some of the
general problems of agriculture and measure to intensify the role of financial
institutions in accelerating the development of Nigeria agriculture.
1.4 IMPORTANCE OF THE STUDY
Agricultural products especially food
being an economic and political issue in the country today, the current
problems associated with high cost of food cannot be separated from the general
health of the economy.
The above mentioned problems are of interest to the government and to
the consumers whose earning is being, eroded by the cost of food. However, this
piece of the would inform like to get into farming
a. The types of agricultural credit
finance that is available in NACB.
b. NACB constancy services
c. The conditions for borrowing
d. Detail requirement
e. How to apply for loan
f. The problems in agricultural lending
in Nigeria
1.5 LIMITATION OF STUDY
This study was meant is explain
clearly the role financial institution in agricultural development, evidently
this research was supposed to cocer the stated of the federation but because of
the wide geographical spread of my research subjects and the inability to
provide enough finance to travel personally to those states in addition to the
poor postal system in the country to receive feed.
Back through questionnaire and within
the time limit required to write and submit this work. And also limited the
area that could have been covered in obtaining data from both banks and
farmers. The ole of the banks in financial agricultural cognizance should be
taken of the increased attention.
DEFINITION OF TERMS
Financial institution: this is an
institution, involves in financial inter-mediation where money is mobilized
from the surplus units and channeled to deficit units. They are establishments
that issue financial obligations ( such as demand deposits) in order to acquire
funds from the public,and also pool these funds and provide them in large
amounts to business, government and individuals for investment.
Agriculture: it can be seen as
science and art of cultivating of land rearing of animals for man and raw
materials for our industries. It also includes the preservation and
distribution of the products of the final users
NAC.B Nigeria agricultural and co-operative
bank was established to improved agricultural development.
REFERENCE:
1. The Fourth National
Development plane 1981-85
(Page
45846)
NTOO. A.
(1986) _
Afribank plc “problems of
Agriculture
financial in Nigeria
Seminar
organized by CBI
Adams D. N. 1979.
‘Recent performance of
rural financial
Marked in low income countriesâ€
Economics and sociologies
occasional
Paper No 596 agricultural
finance
Program department of
agriculture
Economics and rural sociology.
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