Examining the Political-economy of Cocoa Exports in Nigeria

Abstract

Even though there was no coherent policy at the time Nigeria attained independence in 1960, agriculture was the economic mainstay with cocoa production taking the lead. However, the discovery of crude oil and the subsequent oil boom of the late 1970s provided a temporary respite for Nigeria’s political-economy from collapse of the commodity prices. This study examined the significance of cocoa exports as a veritable alternative revenue source to the Nigeria’s dwindling GNP. This study empirically assessed the trends in cocoa export by identifying variables that determine the aggregate cocoa output and export using the methods of functional-analytic framework. The Ordinary Least Square (OLS) analytical technique, using data spanning 1970 to 2010 from various relevant institutions, was utilised. Other analytical techniques employed were subjective descriptive statistics of tables, graph and trend analysis. The study revealed a continued marginal decline in the aggregate output of cocoa attributable to low capacity building and utilisation for controlling the economic and ecological variables affecting cocoa productions. Aggregate output of cocoa in Nigeria showed a strong positive relationship with management of the exchange rates and the utilisation of modern weather control mechanism for annual rainfall and pest control. The period of the liberalisation policy is also discovered to coincide with improvement in total annual income from cocoa, albeit marginally. The study concluded, among others, that the advantages inherent in economic liberalisation could be utilised for the crucial revenue diversification from oil through a sufficient government intervention of boosting cocoa exports in Nigeria. Key