Increasing private participation in agriculture through privatization

In reaction to worrisome performance of agricultural sector in Nigeria, the Federal Government has embarked on various programs and projects aimed at returning the sector to its enviable position. The government efforts have not yielded sufficient desired results, as the country still witnessed high cost of food, general cost of living and perpetual poverty. This paper suggested a redirection of the government efforts to privatization of agricultural enterprises, projects and programs, since it has been shown to have capacity to increase the efficiencies of the concerned enterprises. This study relied on secondary data from Malawi and primary data from private cocoa farmers in Oyo state in Nigeria. The empirical evidence from Malawi shows that technical efficiency of agro-allied industries increased from 65% before privatization to 72% after privatization. The determinants of technical efficiency of the agro-allied industries in Malawi are state ownership, monopoly, capital intensity, Multinational Corporation, and structural adjustment program. While state ownership and monopoly reduce the efficiency, the other three determinants increase it. This indicates that agro allied industries can be more efficient under private control than under the State (Government). The result of analysis of the primary data suggests that farmers that pay for their land are more technically efficient (63%) than those who did not (59%). This allay the fear that increased in cost, that is associated with privatization will not reduce the technical efficiency of the farmers. The paper recommends a gradual privatization of agricultural enterprises, projects and programs in Nigeria. This will not only increase their efficiency but also gender active participation and competition.

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 Record created 2017-04-01, last modified 2017-04-04

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