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Enabling poor rural people to overcome poverty in Nigeria

Rural poverty in Nigeria
The Federal Republic of Nigeria has a population of more than 160 million the largest in Africa and a fast-growing economy. Agriculture is the mainstay of the economy, contributing about 40 per cent of GDP. The agriculture sector employs approximately two-thirds of the countrys total labour force and provides a livelihood for about 90 per cent of the rural population. Nigeria is the worlds largest producer of cassava, yam and cowpea all staple foods in sub-Saharan Africa. It is also a major producer of fish. Yet it is a food-deficit nation and imports large amounts of grain, livestock products and fish.
Nigerias huge agricultural resource base offers great potential for growth. Recent government policies have started to show results: The agricultural sector reportedly grew by 7 per cent a year between 2003 and 2007, and at a slightly lower rate in recent years. Still, the area of land under cultivation could be doubled. Of an estimated 71 million hectares of arable land, only about half is presently under production. And there is substantial scope for an increase in irrigation, which now covers only 7 per cent of irrigable land. Irrigation and other inputs would substantially increase average yields for major staple crops, which are below those in other developing countries.

Despite Nigerias plentiful agricultural resources and oil wealth, poverty is widespread in the country and has increased since the late 1990s. Some 70 per cent of Nigerians live on less than US$1.25 a day. Poverty is especially severe in rural areas, where up to 80 per cent of the population lives below the poverty line, and social services and infrastructure are limited. The countrys poor rural women and men depend on agriculture for food and income. About 90 per cent of Nigerias food is produced by small-scale farmers who cultivate small plots of land and depend on rainfall rather than irrigation systems. The poorest groups eke out a subsistence living but often go short of food, particularly during the pre-harvest period. The productivity of the rural population is also hindered by ill health, particularly HIV/AIDS, tuberculosis and malaria. Women play a major role in the production, processing and marketing of food crops. Yet women and households headed solely by women are often the most chronically poor members of rural communities. Men have higher social status and, as a result, more access to schooling and training. In recent decades, the number of men migrating from rural areas in search of employment has increased, and the number of households headed solely by women has grown substantially. Rural infrastructure in Nigeria has long been neglected. Investments in health, education and water supply have been focused largely on the cities. As a result, the rural population has extremely limited access to services such as schools and health centres, and about half of the population lacks access to safe drinking water. Neglect of rural infrastructure affects the profitability of agricultural production. The lack of rural roads impedes the marketing of agricultural commodities, prevents farmers from selling their produce at reasonable prices, and leads to spoilage. Limited accessibility cuts small-scale farmers off from sources of inputs, equipment and new technology, and this keeps yields low. As the population swells and puts pressure on diminishing resources, escalating environmental problems further threaten food production. Land degradation as a result of extensive agriculture, deforestation and overgrazing are already severe in many parts of the country. Drought has become common in the north, and erosion caused by heavy rains, floods and oil pollution is a major problem in the south and south-east. Civil unrest also aggravates poverty. Religious and ethnic tensions continue to brew in different parts of Nigeria, erupting into outbreaks of violence and leading, in turn, to escalating poverty and malnutrition.

IFAD/H. Wagner

Eradicating rural poverty in Nigeria

The Nigerian Governments National Economic Empowerment and Development Strategy (NEEDS) outlines policies and strategies designed to promote economic growth. The Seven-Point Agenda for Food Security and Poverty Alleviation complements and adds to the national strategy. NEEDS, a federal strategy, is complemented by equivalent approaches at the state level (the State Economic Empowerment and Development Strategy, or SEEDS) and the local level (the Local Government Economic Empowerment and Development Strategy, or LEEDS). In line with NEEDS, the governments Commercial Agriculture Development Programme aims to strengthen food security, increase employment opportunities and boost agriculture as an engine for broad-based economic growth in the country. IFADs support to the programme focuses on smallholder farmers and communitybased poverty reduction. The main goal of NEEDS is the reduction of poverty. The government is particularly concerned about worsening rural poverty, rising unemployment rates among young people and the marginalization of women. The government recognizes, as well, the importance of empowering people to design and manage their own development activities. The current strategy for the protection of poor rural people includes efforts to strengthen: Access to credit and land Participation in decision-making Access to agricultural extension services Access to improved seeds and planting materials, farm inputs and tools Traditional thrift, savings and insurance schemes New policies, legislation and development programmes designed to reduce poverty address its principal causes: weak governance; social conflict; limited technological innovations that hinder productivity; environmental degradation, which aggravates poverty by reducing the natural resource base; and the debilitating effects of HIV/AIDS, tuberculosis and malaria. Current policy interventions also include a focus on fully integrating women into the economic mainstream. Education and training opportunities aim to enable them to play a full role in the economic, social, political and cultural life of the country. There is a particular emphasis on promoting rural womens secure access to land, water and financial services. Additional priorities for the government in rural areas include: Boosting agricultural productivity Promoting off-farm rural enterprises Improving water and electricity supplies, communications, roads, schools and health facilities The government is committed to strengthening rural financial services, including improved access to credit, as a key to reducing poverty. The consolidation of commercial banks, coupled with the promotion of microfinance, has created a strong financial sector. Some 25 commercial banks have branch networks across the country. They can provide all types of financial services, including agricultural finance.

IFADs strategy in Nigeria

Since 1985, IFAD has financed nine programmes and projects in Nigeria, with a total loan commitment of over US$225 million. The country currently attracts over 40 per cent of the financial resources that IFAD allocates to Western and Central Africa. All programmes and projects have addressed the livelihood needs of poor rural people, including smallholders, women, small business owners, poor fishing communities, young people and landless people. These operations have contributed to: Generating and disseminating technology to increase incomes and family food security, while also introducing approaches for effective soil and water conservation and environmental management Fostering demand-driven and participatory approaches to agricultural and rural support services Strengthening institutional capacities to ensure the sustainability of successful development initiatives IFADs support to the Nigerian Governments poverty reduction programme in rural areas targets large numbers of smallholder farmers and is essentially people-centred. IFAD supports programmes and projects that work with communities, with smallholder farmers as the key players. The organization also promotes commodity-based interventions that provide technical and financial support along several value chains such as livestock products, rice and other cereals, roots and tubers, vegetables and agroforestry products. The objectives are to empower poor rural people, especially women, by increasing their access to resources, infrastructure and services; and to promote the management of land, water and common property by local communities, helping to overcome environmental degradation. IFAD-supported programmes and projects address issues such as erosion and the loss of soil fertility, as well as coastal zone natural resource management. IFAD directs assistance towards: Empowering small-scale farmers, landless people and rural women to generate sustainable incomes from farming and other activities Supporting pro-poor reforms and local governance to expand access to information, effective transport systems, village infrastructure and technology Improving access by poor rural communities to financial and social services At the government level, IFAD helps build capacity and strengthen institutions that provide services to poor rural people. It assists with necessary policy changes, developing local organizations to enhance their effective participation, and it promotes initiatives to foster rapid poverty reduction and economic growth led by the private sector.
Programmes and projects: 9 Total cost: US$694.7 million IFAD loans: US$225.1 million Directly benefiting: 2,192,680 households

Ongoing operations


Community-Based Agricultural and Rural Development Programme Rural Finance Institutions Building Programme Community-Based Natural Resource Management Programme Niger Delta Value Chain Development Programme

Value Chain Development Programme

This programme takes a holistic and demand-driven approach to addressing constraints along the cassava and rice value chains. It does so through an inclusive strategy, strengthening the capacity of actors along the chain including producers and processors as well as public and private institutions, service providers, policy-makers and regulators. At the same time, the programme strongly emphasizes the development of commodity-specific Value Chain Action Plans at the local government level, which serve as the basis for rolling out sustainable activities to reduce poverty and accelerate economic growth. The objective is to sustainably enhance rural incomes and food security. The target groups include 15,000 smallholder farming households, 1,680 processors and 800 traders. Specifically, the programme focuses on: Developing agricultural markets and increasing market access for smallholder farmers and small to medium-scale agro-processors Enhancing smallholder productivity and thus increasing the volume and quality of marketable produce by strengthening farmers organizations as well as supporting smallholder production
Total cost: US$104.7 million Approved IFAD loan: US$74.9 million Approved IFAD grant: US$472,000 Duration: 6 years Directly benefiting: 17,480 households

Thirty-five per cent of the matching grants provided by the programme are to be earmarked for women, enabling them to upgrade their production and processing technologies and capacities. In addition, the programme is applying the Gender Action Learning System, a community-led methodology for rural livelihood development and gender equality.

Rural Finance Institution-Building Programme (RUFIN)

The objective of this programme is to strengthen microfinance institutions and establish linkages between them and formal financial institutions in 12 Nigerian states. It lays the foundation for the long-term development of a sustainable rural financial system that will eventually operate throughout the country. By reaching out to poor rural people, the programme ensures that they gain access to financial services and can invest in improving productivity in agriculture and small businesses. Marginalized groups, such as women, young people and those with physical disabilities, are particularly targeted by RUFIN. The programme supports the development of target-group organizations into rural finance institutions that improve poor rural peoples access to low-cost credit. It also assists microfinance institutions, including the Nigerian Agricultural Cooperative and Rural Development Bank, the National Poverty Alleviation Programme, and microfinance banks and NGO microfinance institutions operating in rural areas. The programme helps them strengthen rural outreach and improve services to the most vulnerable groups, notably households headed by women. In addition, the programme works to develop new alternative financial products, promote an improved legal, policy and regulatory framework, and establish linkages between the financial system and the rural production system.
Total cost: US$40.0 million IFAD loan: US$27.6 million IFAD grant: US$400,000 Cofinancing: Federal government (US$6.2 million); Ford Foundation (US$0.5 million); Central Bank of Nigeria (US$1.0 million); National Poverty Eradication Programme (US$0.1 million); Nigerian Agricultural, Cooperative and Rural Development Bank (US$0.8 million); microfinance banks (US$1.6 million); National Micro-Finance Bank (US$0.8 million); participating institutions (US$0.5 million); clients (US$1.0 million) Duration: 8 years Directly benefiting: 345,000 households

Community-Based Natural Resource Management Programme Niger Delta

This programme has made a community development fund available to support local initiatives in sustainable livelihood improvement, natural resource management and the provision of small-scale community infrastructure. The goal of the programme is to improve the standards of living and quality of life of poor rural people in the Niger Delta, with a special focus on women and young people. A major concern is to reduce tensions and conflict by improving employment opportunities for young people and channelling their energies into the development of sustainable livelihoods and natural resource management activities. In the nine Niger Delta states of Abia, Akwa Ibom, Bayelsa, Cross River, Delta, Edo, Imo, Ondo and Rivers, poverty is severe and widespread despite a wealth of natural resources. Poverty is especially prevalent among small-scale farmers cultivating food crops and among fishing communities using only rudimentary equipment. These groups lack food security and are highly vulnerable to environmental shocks. The programme encourages them to participate in development activities. It also builds the capacity of government institutions at different levels to meet the development needs of these groups, and consolidates partnerships among donors, NGOs and other agencies.
Total cost: US$82.2 million IFAD loan: US$15.0 million Cofinancing: Federal government (US$3.8 million); state/local government (US$40.2 million); Niger Delta Development Commission (US$15.0 million); clients (US$4.4 million) Duration: 8 years Directly benefiting: 416,600 households

IFAD/F. Gianzi

Community-Based Agricultural and Rural Development Programme

This programme was launched in eight northern Nigerian states where poverty is widespread: Jigawa, Kano, Katsina, Kebbi, Sokoto and Zamfara in the north-west, and Borno and Yobe in the north-east. It builds on IFADs previous experience with implementing community-based projects in the northern states of Sokoto and Katsina, and its objective is to help the most vulnerable groups improve their incomes and living conditions. The programme targets a large section of the rural population, especially women, landless people, nomadic pastoralists and small-scale farmers, and those with only marginal lands. It is designed to empower these groups to participate in development activities. Specifically, the programme works to: Promote awareness and build the capacity of public and private-sector service providers to respond to the needs of poor rural women and men Empower poor communities to manage their own development and support vulnerable groups Improve agricultural practices, resolve conflicts between farmers and pastoralists, and intensify crop and livestock production Develop or upgrade safe water supplies, environmental sanitation, irrigation, and health and education facilities
Total cost: US$68.4 million IFAD loan: US$42.9 million Cofinancing: Federal government (US$2.9 million); state/local government (US$28.6 million); communities (US$4.0 million); technical assistance (US$3.0 million) Duration: 7 years Directly benefiting: 400,000 households

Completed operations
Roots and Tubers Expansion Programme
Total cost: US$36.1 million IFAD loan: US$23.0 million Cofinancing: Federal/state government (US$13.02 million); clients (US$0.009 million) Duration: 8 years Directly benefiting: 560,000 households

Artisanal Fisheries Development Project

Total cost: US$19.7 million IFAD loan: US$8.2 million Cofinancing: UN Development Programme (US$0.5 million) Duration: 19911997 Directly benefiting: 48,000 households

Building a povertyfree world

The International Fund for Agricultural Development (IFAD) works with poor rural people to enable them to grow and sell more food, increase their incomes and determine the direction of their own lives. Since 1978, IFAD has invested almost US$14 billion in grants and low-interest loans to developing countries through projects empowering about 400 million people to break out of poverty, thereby helping to create vibrant rural communities. IFAD is an international financial institution and a specialized UN agency based in Rome the United Nations food and agriculture hub. It is a unique partnership of 168 members from the Organization of the Petroleum Exporting Countries (OPEC), other developing countries and the Organisation for Economic Co-operation and Development (OECD).

Sokoto State Agricultural and Community Development Project

Total cost: US$17.2 million IFAD loan: US$9.6 million Cofinancing: European Union (US$2.3 million); UN Development Programme (US$2.4 million) Duration: 19942000 Directly benefiting: 19,600 households

Multi-State Agricultural Development Project

Total cost: US$256.4 million IFAD loan: US$12.0 million Cofinancing: World Bank/International Bank for Reconstruction and Development (US$162.0 million) Duration: 19871996 Directly benefiting: 350,000 households

Katsina State Agricultural and Community Development Project

Total cost: US$28.8 million IFAD loan: US$12.2 million Cofinancing: UN Development Programme (US$1.9 million) Duration: 19932000 Directly benefiting: 36,000 households

Contact Atsuko Toda Country Programme Manager IFAD Country Office UN House, Central Area, Abuja FCT Nigeria Tel: +234 0818 4828 770 E-mail: at.toda@ifad.org Benjamin Odoemena Country Programme Officer IFAD Country Office UN House, Central Area, Abuja FCT Nigeria Mobile: +234 803 6660 072 E-mail: b.odoemena@ifad.org For further information on rural poverty in Nigeria visit the Rural Poverty Portal: http://www.ruralpovertyportal.org

Enabling poor rural people to overcome poverty

International Fund for Agricultural Development Via Paolo di Dono, 44 00142 Rome, Italy Tel: +39 06 54591 Fax: +39 06 5043463 E-mail: ifad@ifad.org www.ifad.org
August 2012

IFAD/P. Tartagni