Nigeria Boosts Local Rice Production Amid Economic Crisis

Young men, ageing widows and local chiefs — even civil servants — have taken to the fields to work in rice paddies that stretch for miles around Tarasa, a village in north-west Nigeria.

Two years ago the land in one of the west African nation’s poorest and least developed regions lay fallow. But rice farming is now enjoying a boom — a rare bright spot in a country enduring its worst economic crisis in a quarter of a century.

“Life is getting better around here,” says Labara Hassan, a rice farmer whose income doubled last year, enabling him to put a new roof on his house. This year, the 30-year-old plans to cultivate a larger area and save towards his dream: a pilgrimage to Mecca.

Nigeria’s economy contracted for the first time in 25 years in 2016 as Africa’s top crude producer reels from the impact of low oil prices. But agriculture is one of the few beneficiaries of the government’s radical steps to counter the effects of a crippling dollar shortage.

In an effort to protect its dwindling foreign reserves, the central bank introduced restrictions in 2015 on the allocation of dollars for imports that it said Nigeria should be produced locally — including rice.

The measure forced importers to source dollars on the black market, driving up their costs and creating shortages of some goods. Some factories closed and companies axed tens of thousands of jobs. Inflation has soared to nearly 19 per cent as the government attracts mounting criticism for its handling of the economic crisis.

But as imports became more expensive, demand for locally produced rice — a staple food in Nigeria — soared, drawing businessmen from the south to the north to buy directly from smallholder growers. Prices for Nigerian rice increased nationwide last year by about 60 per cent, according to the National Bureau of Statistics.

“They [the measures] created a market for locally grown rice paddy. Now demand exists,” says an adviser to President Muhammadu Buhari, who did not want to be identified. “This is a starting point.” He adds that it was helping the government’s drive to diversify the economy — agriculture accounts for about 24 per cent of gross domestic product, but Nigeria depends on petrodollars for 90 per cent of its export earnings and 70 per cent of state revenues.

The country has vast amounts of arable land but produces little of what its more than 180m people eat. Rice can be grown across the country, yet groceries and markets nationwide stock produce from Thailand and China. Domestic agriculture is dominated by smallholders and subsistence farmers.

About 46 per cent of the rice consumed in Nigeria in 2015 was imported, according to the US Agency for International Development. To boost local production, the central bank piloted a scheme last year in several northern states to supply materials such as fertiliser to help poorer farmers. The initial results have been promising. The states included in the pilot reported an increase in rice production of 20 per cent last year compared with two years ago, according to the statistics bureau. The government says it will expand the programme this year. Read the full report here.