The Impact of the Land Use Act on the development of Agriculture in Nigeria

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The need to diversify the Nigerian economy has received a consensus – from the academia to the media and down to the average man on the street – owing to the recent stack of realities of general price accretion and abysmal cost of living. An economy that is import-orientated and relies heavily on the sales of crude oil cannot deliver the changes that her populace crave for. Nigeria is said to run on a mono-economy because of her over dependence on oil revenue. Unfortunately, the successive administrations seem to toe the same path of insensitive economic policies. For instance, the efforts of the CBN in the recent times to manipulate the economy using fiscal and monetary tools without the government addressing the fundamentals for economic growth has only aggravated rather than ameliorating the crunch.

Coupled with this economic jaundice is the archaic laws and policies on which businesses are transacted. Efforts to have these repugnant laws reviewed also suffer from legislative sabotage because certain individuals’ interests are not catered for.  What then is the way out of the woods we are presently in the nation? It is diversifying the economy with a sense of urgency. Agriculture sector development is a veritable option for Nigeria if she will recover from the present economic crises.


This article examines how investing in agriculture can be used to jump start the Nigerian economy.  It also highlights the Land Use Decree (now Land Use Act) 1978 as a potential constraint inhibiting the growth of the sector. Then, a clarion call is made to create an enabling environment for the growth and development in the sector.


A study was conducted by the World Bank looking at the effect of decline in oil price on the prices of other commodities on Sub-Sahara Africa countries. It was discovered that a 30 percent decline in oil price would have a 5 percent decline in agricultural prices and 10 percent decline in metal commodity prices on the difference between exports and imports in percent of GDP, assuming no supply response. Oil exporters with a narrow economic base such as Angola and the Republic of Congo would be affected the most. The positive effect on oil importers is reflected in large trade balance improvements for Côte d’Ivoire, Eritrea, Kenya, Niger, and Senegal and moderate trade balance deterioration in South Africa. It is interesting to note that the five countries that have positive effect have agriculture as the mainstay of their economies. For instance, Cote d’Ivoire is the biggest producer of cocoa in the world. She is also ranked the first largest producer of palm oil and rubber in Africa, fifth and seventh producer in the world respectively. Eritrea which is one of the poorest countries in the world still have positive effect because agriculture serves as the economic stabilizer in the face of global oil price decline. Niger though ranked near or at the bottom of worldwide indexes of the Human Development Index, GDP, and per capita income, thrives on the export of groundnut and cattle to Nigeria. In Kenya, agriculture is the second largest sector after services. From this study, it could be inferred that agriculture gives a stabilizing momentum to an economy in the face of global turbulence. A country that gives priority to developing agricultural sector will reap sustainability in her economic endeavor.


Every economy revolves around three concentric circles; the agrarian (primary), the industrial (secondary) and the post-industrial (tertiary). So for instance, the developed nations like the US have evolved from one built on agriculture to one built on information and services. Most of the countries in Africa are still in the nascent stage of economic evolution. For example, Nigeria had a robust economy in the sixties and the 1970’s because they were predominantly agrarian; but the oil boom in the 80’s rendered the other sectors redundant and has plunged the nation into untold woes. Comparing the economic structure of Nigeria in the 1970’s and 1980’s, it is observed that agriculture contributed 41.3% while oil sector only 6.0%; and agriculture had 20.6% while oil sector 29.1% in the respective years. In just a decade, a dramatic negative change was seen in the contribution of agriculture to the nation’s GDP. Nigeria’s agricultural sector became a victim of policy discrimination after the large oil discoveries. In the early 1970’s, labour and capital left agriculture for manufacturing, mining, construction and services. Coupled with this problem is what is referred to as “Dutch Disease” arising from the overvaluation of Nigerian currency which still remains despite structural adjustments made.


The development of agriculture sector in Nigeria is bewildered with a number of challenges ranging from funding to policies implementations. The Land Use Decree (1978) now The Law Use Act is archaic and repugnant in the face of present realities. The challenge of Land Use is not localized to the Nigerian terrain only; it is a regional issue that affects the entire West Africa countries.  This is the reason why the countries in West Africa are relatively poor compared to other countries in Africa. Indeed, the last six countries in the Human Development Index are all in West Africa. The West Africa Economic and Monetary Union (WAEMU), which brings together eight countries in the region through a monetary system, adopted an agricultural policy in 2001 which sought to improve food security and better living conditions for producers by developing rural economies, increasing incomes and social status. Land ownership and tenure affects how the policy will operate and is one of the critical factors that affects the achievement of the policy objectives. There are two main Land Use policies in West Africa. In some countries, the state have sovereignty over land; while others have the private and customary land rights.  In many of the Francophone countries, the state controls the use of urban lands and grants land for private development through the process of “immatriculation”, even though the state also exercises powers of expropriation as is the case in Niger. In the Anglophone countries, notably the Gambia, Ghana and Sierra Leone, the state has access to land through its powers of eminent domain. In Ghana, 20 per cent of the land is owned by the state. Other land resources such as the permanent forest estates (forest reserves) also form part of the landed estates over which the state exercises authority. In Nigeria, lands are vested in the state in the belief that the state is a better manager of land than the customary owners. Outside the lands owned or controlled by the state are private lands and lands held under customary arrangements. Private lands in the form of freeholds occur in Mauritania, Togo, Côte d’Ivoire (through the process of immatriculation), small parts of the Gambia, the western area of Sierra Leone, Liberia and small pockets in Ghana. In Côte d’Ivoire, companies and individuals own large tracts of land held under plantations or other commercial development. It is therefore no surprise that the Côte d’Ivoire economy is thriving in agriculture giving the liberalized land use policy and the enabling environment for sustainable growth and development. Can the Nigerian government borrow a leaf from what other neighbouring countries are investing in agriculture sector in terms of innovative policies and fund allocation?

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Let us consider some of the grey provisions in the Land Use Act that are hostile to the development of agriculture in Nigeria.


Challenges with the Land Use Act

  • The State Sovereignty: The Land Use Act vested all Land compromised in the territory of each State (except land vested in the Federal government or its agencies) solely in the Governor of the State, who would hold such Land in trust for the people and would henceforth be responsible for allocation of land in all urban areas to individuals resident in the State and to organizations for residential, agriculture, commercial and other purposes. This provision is rendered ineffective in the sense that it never extinguished the rights of indigenous owners. The state’s interest therefore became a layer on top of the existing indigenous rights. Such a situation always creates conflicts between the state and the original owners regarding the ownership and control of such lands. In the same vein, the lands in rural areas to be granted by the Local Government have witnessed fraudulent and corrupt practices. The Land Allocation Advisory Committee which is responsible for advising the local government as regards the management of land, are reportedly not functioning.


  • Bureaucracy: The process of registering and obtaining the Certificate of Occupancy is cumbersome. Some documents are to be filed with the Local Government for verification among others are: a sketch diagram of the land, 3 years consecutive tax clearances, 3 years state development levy (for an urban area), a statement of bank account, and a feasibility study report. An average farmer finds it difficult to provide these documents; hence, he would not want to apply formally. It takes about six to nine months before a Certificate of Occupancy is granted with a rigorous process of registration. In addition, the State Governor must sign the Certificate of Occupancy. This is capable of demotivating a would-be investor in this sector.


  • Illiteracy and Ignorance: Most farmers, especially those in the rural areas, are unaware of the provisions in the Land Use Act. Certain provisions of the Act are ambiguous making interpretations difficult for a layman. The professional services of a legal practitioner would be required at a fee charged.


  • Ceiling of Landholding: The Act imposed a ceiling on urban and rural landholdings: no individual can hold more than 0.5 hectares of undeveloped urban land, 500 hectares of non-urban land, or 5000 hectares of grazing land. This indeed places a ceiling on private individuals or corporate bodies who may want to develop a scale commercial agriculture.


Though the implementation of the Nigerian Land Use Act has some demerits for agricultural development, yet it has some potentials for growing this sector if the government can make certain of its provisions more flexible and sensitive to the present economic realities. What then are the inherent benefits of the Land Use Act?


Benefits of the Land Use Act

  1. Conflicts Resolution: Conflicts are said to have a direct threat to food security as they cause massive loss of life and therefore loss of workforce (which is particularly important as agriculture tends to rely heavily on human labour), loss of vital livestock, and loss of land. Access to and use of natural resources – like water and land for grazing or crop production – are key sources of conflict. Nigeria has witnessed bloody conflicts in the recent past between the cattle herdsmen and the farmers in Benue State. An investigation was conducted by the government to know the causes of the problem and proffer lasting solutions. It was gathered that the herdsmen migrated from the northern to the southern regions due to global warming, desertification and Boko Haram insurgency to find grazing for their cattle. While the farmers in the south claimed that the cattle destroy their farm produce being unchecked by the herdsmen. The government plans to resolve this problem by establishing ranches in various areas for grazing; though, this gesture is receiving reservations from some quarters on the account that a cattle rearing was private business. The state control over land in the nation has helped settle conflicts arising among individuals and groups for peaceful co-existence.


  • Priority Allocation: To achieve food security in the country government must give a priority attention to developing agriculture sector. The perennial problems of land ownership disputes, inadequate funding, and dearth of modernized farming implements and green revolution should be addressed with urgency. Full government supports should be lent to all policies designed for enhancing agricultural development; both in terms of appropriate legislations and monitoring implementations.


Furthermore, in the developed economies, agriculture occupies a conspicuous place in the annual budgetary allocation; and decisive efforts are being made to introduce innovative farming approaches. For example, China has begun its 13th Year Plan for agriculture (2016-2020) to restructure and upgrade the business models and production systems which focus on technology, and extend the production chain of agriculture. In the areas of the green revolution, the country will follow its ‘red line’ system and guarantee that land dedicated to farming never shrinks to less than 120 million hectares. It will tighten water resource management, level of groundwater will be closely watched.


  • Income Generation for GDP growth: If enabling environment is created for agriculture business in Nigeria and it receives a priority attention from government, she will recover her lost glory in the comity of nations not only in Africa but also in the world. Currently, Nigeria is the largest producer of cassava and yam globally. Nothing stops her from being the largest producer of other agricultural produce such as palm oil, cocoa and rice if the government strives for it.



  1. GLOBAL ECONOMIC PROSPECTS, January 2015 for Sub-Sahara Africa
  2. Adebiyi Daramola, Simeon Ehui, Emmanuel Ukeje and John McIntire (et al), Agricultural Export Potential in Nigeria
  3. AUC-ECA-AfDB Consortium (2011), Land Policy in Africa: West Africa Regional Assessment, Addis Ababa, Ethiopia


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