THE IMPACT OF THE DISTRIBUTION AND UTILIZATION OF OIL PALM ON THE SOCIO ECONOMIC DEVELOPMENT
1.1 Background of the study
Nigeria ranked sixth among the poorest countries in the world with over 70% of the population living below poverty line in 2007 (Central Intelligence Agency, 2012) while 46% lived below $1.25 daily in 2010 (World Bank, 2014). Okonjo-Iweala (2014) noted that Nigeria is one of the five countries in which two-thirds of the world’s extreme poor are concentrated; the others are India, China, Bangladesh, and the Democratic Republic of Congo. The poverty in Nigeria is largely rural (poverties.org, 2013) where the effects of macro-economic shocks in terms of fiscal adjustment and monetary policy reforms are felt much more. Thus, whereas poverty is expected to decline by 40% in the urban centers, it would increase by 7% in rural areas which inhabit almost 80% of the population living below the poverty line and depend on agriculture for food and income (International Fund for Agricultural Development, IFAD, 2009). Consistent economic growth and prosperity are central to poverty alleviation and the oil palm industry has been identified as one effective avenue for rural income generation, especially among the women who process and sell palm oil in local and national markets, food security and economic stability (Partnership Initiatives in the Niger Delta, PIND, 2011).
A huge percentage of farmers in Nigeria are small scale farmers. Small-scale farming involves growing crops, at least in part, to be used by an individual family, with farming being a significant source of their livelihoods (Lininger, nd.)Small Scale farming is usually characterized by intensive labour and in most cases, animal traction, limited use of agrochemicals and supply to the local or surrounding markets. Unlike large-scale commercial agriculture, it plays a dual role of being a source of household food security as well as income from sale of surplus. Although some claim small-scale agriculture is less efficient in output as compared to commercial agriculture (Kirsten & Van Zyl, 1998), it is ecologically friendly in that less land is cleared for cultivation, there are less emissions due to less use of fuel-driven machinery and the market is usually local implying less carbon miles (Kutya, 2012).