Agriculture struggles as Nigeria’s economy expands in 2024

Nigeria’s economy recorded a stronger performance in 2024, growing by 3.4% compared to 2.74% in 2023. However, while the overall economy showed improvement, the agricultural sector continued to face challenges, slowing its contribution to growth.

The latest GDP report released by the National Bureau of Statistics (NBS) on Tuesday shows that the economy grew by 3.84% year-on-year in real terms in the fourth quarter of 2024, an improvement from the 3.46% growth recorded in both Q3 2024 and Q4 2023.

The full-year GDP growth stood was the highest since 2021.

Agriculture, which has long been a key pillar of Nigeria’s economy, expanded by just 1.76% in the final quarter of 2024, lower than the 2.1% growth recorded in the same period the previous year. Its contribution to GDP also declined over the course of the year, reflecting the persistent struggles of farmers and agribusinesses.

Insecurity remains one of the biggest threats to the sector. Armed attacks on farmer, and kidnappings in key food-producing states have disrupted farming activities, forcing many to abandon their land. Additionally, climate-related challenges such as flooding and droughts have worsened conditions, destroying crops and reducing yields. These factors have combined to slow down growth in the sector, despite its critical role in food production and job creation.

Inflation and foreign exchange instability have made it more expensive for farmers to operate, further straining productivity. Many smallholder farmers, who make up the bulk of Nigeria’s agricultural workforce, struggle to afford these necessities, limiting their output and earnings.

The slow growth in agriculture is particularly concerning given its importance to food security. With production failing to keep up with demand, food prices have remained high, squeezing household budgets and increasing hunger levels in many parts of the country.

While agriculture lagged, the services sector emerged as the strongest driver of GDP, growing by 5.37% and accounting for over half of economic activity.

Meanwhile, the industrial sector also recorded a slowdown, growing at 2.00% in Q4 2024, a notable decline from 3.86% in Q4 2023.