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DIVERSIFICATION OF ECONOMY AND NATIONAL SECURITY:

AGRICULTURE/TOURISM DRIVE IN PERSPECTIVE

CHAPTER 1

INTRODUCTION

BACKGROUND TO THE STUDY

1. Nations are not equally endowed in terms of resources and mineral

ores. Where resources exist, they are usually limited. Where resources
have been evenly spread, it is also necessary for people to contribute
towards common-use for infrastructure development, security and utilities
such as water, electricity, roads and human capacity. The existence of such
deposit of mineral resources contribute towards satisfying the well-being of
the citizens as it is anchored on effective and efficient handling of such gift
for economic development. Economy diversification which demands active
participation in wide range of sectors and firmly integrated into different
regions are better able to generate robust growth and great potentials to
increase Nigeria’s resilience and contribute to achieving a sustainable long
economic growth and development in the continent.

2. A strong growing sustainable economy is the goal of every nation in

the world. However, developed countries such as United States of America,
Britain, France, Germany and China agreed that economic development
has been very slow on African continent despite its riches in mineral
resources.2 Nevertheless, African countries have not been very successful
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in wooing investors to the continent. A significant bottleneck for economic

development in many countries of the region is its poor physical
infrastructure. Essential services like electric power; water, roads,
railways, ports and communications have been neglected, especially in the
rural areas more particularly the exploration areas. The most important
things to reiterate about the regions economy are that it remains
undeveloped and is becoming increasingly marginalized in a competitive
global economy where other developing regions are making the fastest
headway on development.3 In this instance, African countries continues to
rely on exporting primary commodities which cannot generate enough
investment capital for it’s economic drive. It is imperative to note that
Nigeria ranks among the most richly endowed nations of the world in terms
of natural, mineral and human resources.4 The country has a variety of
both renewable and non-renewable resources, some of which have not yet
been effectively tapped. Solar energy, probably the most extensive of the
underutilized renewable resources, is likely to remain untapped for
sometime and the vast reserves of natural gas produced with crude oil
have yet to be fully utilized.5 ( Akpan, 2009 & Olumola, 2006).

3. The current internal security challenges in the country poses threat

to our national survival in all dimensions. The economic recession have
threatened the national security where individual security has been
threatened by the absence of the basic requisites of individual survival. The
conflicts between the cattle herdsmen and farmers in Benue, Nasarawa

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and Enugu States as well as the Niger Delta Avengers (NDA’s) are
instructive.6 Consequently; the environmental issues also threatened the
national security of the country in a similar manner. Notwithstanding, the
growing dangers of the interconnected environmental problems such as
climate change, destruction of ecosystem and unsustainable use of natural
resources gave room to national security.7 This is all about a nation’s
evolution in the international and domestic environment, her national
interests and approach to protecting and promoting it.

4. Diversification simply applies the stage of moving from one aspect

of dependence to another in a gainful status. This normally refers to
exports and specifically to policies aiming to reduce the dependence on a
limited number of export commodities that may be subject to price
fluctuations in global market. This diversification of economy may be
classified into two basic dimensions namely; horizontal and vertical
diversification. Within the political economy, diversification takes place
through horizontal pattern where new opportunities are sought for new
products within the same sector. For example mining, energy and
agriculture.8The vertical pattern entails stages of processing domestic or
imported goods. However, these encourage forward and backward linkages
of economy. As the output of one activity becomes the input of another
thus, upgrading the value- added product.10 Furthermore, this entail a shift
from one sector or industry to another. Generally, from the primary to the

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secondary and tertiary sectors. For example, a mining company may

expand from extracting copper to engage in processing and transporting.

5. Consequently, the company may shifts from extraction being primary

sector to manufacturing. For instance, producing electric cables as a
secondary sector and finally retails the product through transporting as
tertiary sector. It follows that a country through diversification may attain
three linked objectives via stabilizing earnings, expanding revenues and
retaining or increasing value-added. Since the country is wooing for
investors to establish in the country, there is need for Nigeria Government
to provide an enabling environment devoid of security threats that would
attract foreign investors. These would go a long way for the government
equipping her armed forces and other security organizations to function
effectively and efficiently. Diversification is often used interchangeable with
industrialization even though, obviously they two carried different
meanings. According to the Encyclopedia Brilanniea defines industrialization
as the process of converting to a socio-economic order in which industry is
dominant11 As a country that involves in diversification, it is often that such
country would be industrialized.

6. In the context of this study, it entails the process of creating

service industries such as tourism, insurance, banking, real estate services,
financial services, transportation, restaurants, repair and maintenance
services. Going through the study, the paper would focus Nigeria

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diversification on farming, fishing, transportation, solid mineral, tourism

and agricultural in a wider perspectives of diversification. Given the aim of
diversifying away from oil and gas revenues, the development of the oil
sector can be seen as part of diversification strategy. The extraction of oil
and gas, oil based industries include refineries, petrochemical sector and
energy-intensive industries such as aluminium are usually large- scale and
capital intensive projects which are generally state owned. It is obvious
that diversification by expanding the oil industry will not reduce
dependence on oil and gas since the industry relied on wholly on the low
cost and ample supply of oil and gas in each of the Gulf Countries.12 Many
challenges arise when pursuing a diversification strategy. It is often
necessary to make significant investments in human resources and
infrastructure to support economic sectors and activities such as value-
addition in commodities.

7. These are long- term endeavours that need government

commitment and political will. It is important to note that there are many
benefits that could arise from the exemption of oil market into
diversification through agriculture. This will afford an increase in trade,
higher productivity of capital and labour and to an extent, yield better
regional economic integration.13 In addition, provide an effective public
management that can help to reduce poverty and promote human and
social development.

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