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Many stakeholders believe that if the current Federal Government led by President Muhammadu Buhari would live up to its promise to make agriculture replace oil as major revenue earner, the country would have not only provided food security for Nigerians, but also created jobs for the unemployed youths.
To achieve this however, experts say the government takes practical and concrete steps to restore agriculture to its glorious position as the mainstay of Nigeria’s economy.
Buhari had said at a forum that “We must stop paying lip service to agriculture by taking practical and concrete steps to restore it to its glorious position as the mainstay of our economy providing employment, food for our teeming population as well as leading foreign exchange earnings,” he said.
On agricultural policy, Buhari said he will provide farmers with a dignifi ed living through improved inputs, extension services, access to credits and price support mechanisms.
“We would re-vitalise the agricultural sector and make it the engine of growth, and source of job and wealth creation. Some of our policy thrust would include agricultural enterprises value chain and cluster development for commodities, and institutional framework and support for agribusiness investment. In this regard, the Abuja Commodity Exchange shall be reinvigorated and supported,” the president had also said.
However, many industry watchers believe that the immediate past administration did not do badly in trying to revive the agric sector but would want the current government to improve on what is on ground.
In line with federal government’s goals geared towards the diversifi cation of the economy, the Central Bank of Nigeria, CBN, through its Subsidiary, Nigeria Incentive-based Risk Sharing System for Agricultural Lending, NIRSAL and other key stakeholders have taken steps to reposition the agric sector.
The CBN for instance has said it was poised to reposition agriculture through value chain fi xing for economic growth and development to promote for sustainable and lucrative harnessing of the great economic potentials of key agricultural export crops in the country.
As a key player in the country’s economy, the apex bank said it was committed towards boosting the Nation’s foreign exchange earnings from the agricultural sector.
Acting Managing Director, NIRSAL Plc. Mr. Edwin Nzelu, at a recent capacity building organized by the CBN, Bankers Committee and German International Corporation, GIZ, in Lagos said the aim of the training was to share knowledge and to gain from the experts on agricultural value chain fi nancing “who will take you through the initiation and execution of agricultural credit requests and appraisal of it from farmers.”
He said that capacity building is an important step in repositioning agric as a business.
Nzelu recalled that the CBN in July 2011 launched the Nigeria Incentive-based Risk Sharing System for Agricultural Lending, NIRSAL.
According to him NIRSAL is a holistic approach aimed at de-risking agricultural lending through fi xing of fi nancing and commodity value chains in the agricultural sub-sector.
“This is with a view to reducing the perceived high risky nature of agriculture harbored by bankers towards lending to this all-important sector of the economy. It is noteworthy that agriculture contributes more than 23 per cent to the Nation’s Gross Domestic Products, GDP and creates about 65 per cent of job in the country in 2014.
Many stakeholders have said that increasing attention of the CBN is well situated now that the price of crude oil has crashed.
The CBN Governor, Mr. Godwin Emefi ele, recently decried the neglect of the agricultural sector by successive governments, saying Nigeria is now a net importer of agricultural produce with import bill of over N630bn.
Emefi ele, who disclosed this at a workshop organised by CBN and the Alliance for Green Revolution in Africa ,AGRA, on Innovative Agricultural Products, in Lagos, stated that the large import of food products include wheat, rice, fl our, fi sh, tomato paste, textile and sugar.
He disclosed that the insurance pillar of the Nigeria Incentive-based Risk Sharing System for Agricultural Lending ,NIRSAL, has been activated as this would help reduce risks associated with the sector.
“NIRSAL is built on fi ve pillars where 1st and 2nd pillars, which are risk-sharing and technical assistance have been activated, while the 3rd pillar is the insurance, which is being activated today. This workshop signals the kick starting of the insurance pillar. We have the 4th and 5th pillars known as bank rating and bank incentive respectively.
The bank rating and the incentive can commence after the insurance pillar,” he said. He, however, called for the development and expansion of the agricultural insurance sub-sector, as this would go a long way in mitigating natural disasters and eventually encouraging banks to lend to agriculture.
“Expansion of agricultural insurance products has become imperative especially now that climatic reports have it that Nigerian farmers are prone to risks from natural disasters such as fl ood, draught as well as different crop and livestock diseases,” he said.
According to Senior Technical Advisor,GIZ, Ayo Akinola, with over 50 per cent of the population living in cities, Nigeria has huge demand sinks for fresh and processed food and for products derived from raw material produced by agriculture, fi shery, forestry and so on.
He said the growing imports are needed to satisfy Nigerians’ demand for such products despite the favorable weather conditions, the landmass and the abundant human and natural endowments that can truly propel the Nigerian economy to greater heights.
On his own the Country Director of GIZ, Dr. Thomas Kirsch said Agriculture is a good business for Nigerian producers provided that they combine technical and management skills with the required investments in quality inputs and equipment.
He said that GIZ-Sustainable Smallholder Agribusiness, SSAB, Program has developed the Farmer Business School, FBS, in 2010 for 4 cocoa producing countries.
“We supported extension services, Micro-fi nance institutions, companies to train over 300.000 farmers in Farmer Business School.
“The success triggered others to take the approach over. Together with other GIZ programmes we have implemented FBS for over 400,000 farmers in 12 African countries and across a number of value chains principally, cassava, cocoa, coffee, cotton, rice and tomato”, he said.
However there are challenges facing the revival of agric in the country and many believe that the earlier the government intervene the better for the achievement of the desired goal.
Some stakeholders in the Agro-Commodity Export recently called on the Federal Government to address the ban placed on some Nigerian produce by the European Union, EU.
Chairman, Export Group of the Lagos Chamber of Commerce and Industry, LCCI, Obiora Madu, made the appeal in Lagos.
Madu said that it was imperative for the government to resolve the issue before the June 2016 deadline given by the EU to correct the anomaly.
“Yes, there are many export markets beyond Europe but if we do nothing, it is likely to escalate when other nations join the EU to reject our produce then we are in trouble.
“As a chamber, we are concerned about the trend and are actively at the forefront of sensitising farmers and exporters on compliance to international standard for our produce,’’ he said.
He stressed the need for collaborative efforts of all regulatory authorities and relevant stakeholders in formulating a framework to address the challenges of the nation’s agricultural produce in the international market.
Mr. Madu noted that the country’s natural resources were not utilised to the optimum for economic growth.
“Agriculture is a viable alternative that can sustain the economy considering the reality of dwindling oil revenue.
“At the country’s independence, agriculture held sway, over 90 per cent of earnings came from agriculture but presently the entire non-oil sector, including solid minerals is contributing less than 10 per cent to the GDP.
“The potential is there but the concentration in oil removes our attention from agriculture,” he said.
He also urged the government to create more incentives for agro exporters to mitigate the defi ciency of logistics, infrastructure and high cost of exporting goods.
The EU in June suspended some of the nation’s food items.
They include beans, sesame seeds, melon seeds, fried fi sh, meat, peanut chips among others from entering Europe till June 2016.
According to the European Food Safety Authority, the rejected beans were found to contain between 0.03mg per kg to 4.6mg/kg of dichlorvos pesticide. The acceptable maximum residue limit is 0.01mg/kg.The excess chemical in the produce EU may be harmful to health.
On his own, Director-General, Small and Medium Enterprises Development Agency of Nigeria, SMEDAN, Mr Bature Masari has called for the development of agro allied industries to boost job creation in the country.
Masari, who made the call in Abuja said the agency is committed to the development of Small and Medium Enterprises in Nigeria.
According to him, agro allied processing will not only boost job creation but also attract Nigerians massively into agriculture sector.
Masari decried lack of access to fi nance by Nigerians, saying that SMEDAN had been mandated to coordinate activities on Micro, Small and Medium Enterprises (MSME) in the country, including agricultural sector.
‘’We coordinate activities in that particular sub-sector with a view to ensuring that whatever is needed by the government to support MSME in Nigeria is implemented by the agency.
‘’And we have been doing that to the best of our ability in every state of the country and we have been able to ensure that MSMEs receive fi nancial assistance.’’
The Director explained that there were very many Nigerians with profi table enterprising ideas but lack necessary collateral to obtain the needed fi nancial assistance to boost their businesses.
Masari said that SMEDAN has been able to undertake proper identifi cation of agriculture products that can generate both employment and revenue to the teaming population and the country.
National Rice Millers Association of Nigeria, NRMAN, has that the NCS, erred in its decision to lifting of the ban on importation of rice through the land borders, would destroy Nigeria’s rice value chain attained by the previous administration.
Chairman of the association, Mohammed Abubakar, such a policy decision should be looked at thoroughly in order not stifl e agric.
The Federal Government of Nigeria has commenced the empowerment of 30, 000 youths through its Youth Employment in Agriculture Programme (YEAP), according to the Permanent Secretary, Federal Ministry of Agriculture and Rural Development, Sonny Echono.
According to a statement, Echono said the Programme endorsed by the ministry’s Director of Information, Mr. Tony Ohaeri in Abuja would cut across the various value chains, which include rice, maize, tomatoes and others.
Mr. Echono stated that the ministry received about 34,000 applications from intending Nagropreneurs and Market Oriented Producers from 12 participating states including the FCT.
He said that a total of 250 Nagropreneurs would be selected per state including the FCT under the fi rst phase of the programme.
The Permanent Secretary explained that the validation and fi nal selection of the young Nagropreneurs and Market Oriented producers would be done at state levels in collaboration with the ministry’s state Directors.
He said that training would also be conducted for the benefi ciaries at different credible Agricultural and Research Institutions, universities and other vocational training institutions across the country.
Analysts have said that agriculture Agriculture is a major component of the real economy. The federal government and the CBN have in the past three decades designed and implemented various programmes and schemes aimed at addressing the problem of low investment in agriculture.
These interventions have ranged from instruments such as the regulation with variants of credit quota and interest rate ceiling to institutional supports such as the establishment of NACB now known as Bank of Agriculture, Bank of Industry ,BOI, Nigerian Agricultural Insurance Company ,NAIC as well as the Agricultural Credit Guarantee Scheme Fund ,ACGSF.
Recent interventions have also included the N200bn Commercial Agriculture Credits Scheme, CACS, the SME Credit Guarantee Scheme, SMECGS and the N200bn Restructuring and Refi nancing Facility, RRF.
The strategic intent of NIRSAL according to the CBN is to spark agricultural industrialisation process through increased production and processing of the greater part of the commodities produced in the country to boost economic earnings across the value chain. NIRSAL will: Stimulate innovations in agricultural lending, encourage banks that are lending to the agricultural sector, eliminate state-dependency by banks for deploying loanable funds to agriculture and ensure a risk sharing system that will build a business approach where banks share in the risk of lending to the sector among others.
It also intends to increase the total value of agricultural lending from the current 2 per cent to 10 per cent of total bank lending within 5 years, leverage N450bn in bank lending into agriculture, thereby closing 60 per cent of the agriculture fi nancing gap , enhance lending capacity by banks and development of a sustainable agricultural lending systems, processes and reduce banks’ perception of agriculture as highly risky ,through increased lending.
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