Can Liberian and African Agriculture Gain from World Oil Price Decline?

0
862

The decline in petroleum prices worldwide has been seen as a moment of opportunity for acceleration in African agricultural production. A recent report entitled Food Security in Africa by Price Cooper Waterhouse, one of the world’s leading accounting and auditing firms, said the decline in oil and gas prices since 2014 has resulted in the “collapse” in the currencies of oil and gas producing African countries, such as Nigeria, Ghana and Angola. This has also led to slowed Gross Domestic Product (GDP).

The Central Bank of Nigeria, for example, recently predicted a GDP growth in 2015 of 2.6%, compared to 6.3% just last year.
“. . . the depreciation of currencies in these economies,” said the PcW report, “also presents an opportunity for the agricultural sector. Agriculture seriously undertaken could counteract some of the effects of reliance on oil and gas, which dramatically enhanced its foreign exchange earnings. It was thus easy for a country like Angola and Nigeria to rely exclusively on oil and gas for foreign exchange, rather than bother with investment in the agriculture sector. And with the massive foreign exchange earnings coming from oil and gas, such countries had no problem raising the foreign exchange to import food.

But now that the goose that laid the golden egg has been seriously injured, due to the sudden fall in the prices of petroleum products, Price Cooper Waterhouse sees this as an opportunity for Nigeria, Angola and other African countries, which are still endowed with a lot of arable land, water and cheap labor, to invest profitably in agriculture.

Although Liberia is not yet a petroleum-producing nation, we are actually in almost the same boat as Nigeria and other nations, since the chief foreign exchange earners in the Liberian economy—rubber and iron ore—have also suffered steep declines recently. Liberia, too, therefore, with all its still existing rainforests, abundant rainfall, extensive acreage of arable land and cheap labor, stands a very serious chance of dramatically enhancing its agricultural productivity.

There is, for example, absolutely no reason Liberia still imports most of its staple, rice, which can definitely be grown abundantly in Liberia. Yes, there is the problem with the rice birds, which are a constant nemesis for rice farmers. But surely a solution could be found, as it has been for all the other rice producing nations.

Liberia, like all the other African nations hit by falling export commodity prices, cannot afford to sit and whine about this problem. As Price Cooper Waterhouse suggests, these countries, including Liberia, must now start growing more food and eliminate the necessity for imports. As this newspaper said editorially a few weeks ago, Liberia, by paying serious attention to and investing in agriculture, can replace a considerable portion of the foreign exchange lost from the fall in export commodity prices. After all, it is a fact that we spend annually over US$200 million on the importation of rice alone; and also a considerable amount on meats, canned goods and even fruits and vegetables.

The only thing standing in the way of taking advantage of what PwC calls this serious agricultural opportunity in Africa is the lack of focus on the part of our governments and the rest of us.

But where the government has failed—and this is a very serious failure—individual agricultural entrepreneurs can come forward and lead the way, with some public and private help. We say it is a serious failure on the part of government because we recall how the United States government took the lead in making the USA not only self-sufficient in food. It empowered its farmers to grow so much food that soon it became the world’s breadbasket. The American government, among other things, established land grant colleges in many states and encouraged them through funding, etc. to undertake research. The Department of Agriculture was a driving force in this endeavor.

We hope that our government can see the urgent need to become proactive in encouraging our farmers as well as our schools, colleges and universities and turn them into agricultural research and production centers.

We encourage our individual farmers, too, to take their trade very seriously and produce, produce, produce, until Liberia starts feeding itself and begins to help feed other nations.

Leave a Reply