Nigeria’s food import is growing by about 11 percent per annum, with
top imports including wheat, rice, sugar and fish. The last
administration made many attempts to unlock Nigeria’s agricultural
potential as the country contains 84 million hectares of arable land, of
which only 40 percent is utilized. More alarmingly, only around 0.8
percent of arable land is even irrigated, compared to the 28 percent
that is in Thailand. Although there are approximately 110 million young
people in the work force, due to low wages for laborers in the
agricultural sector, food production has largely been left to the
elderly.
Nigeria possesses nearly 279 billion cubic meters of surface water,
yet potential sources of irrigation from two of the major rivers in
Africa – the Niger and Benue Rivers – remain unexploited. The primary
challenge at hand is how to increase agricultural productivity. Yields
per hectare are only 20-50 percent of comparable yields in developing
countries like Brazil, Indonesia, Thailand and Malaysia and this leaves
much room for improvement. In terms of input, Nigeria has one of the
lowest usage rates. Mechanization intensity remains low (perhaps 10
tractors per 1000 hectares compared to Indonesia’s 241 tractors per 100
hectares).
The last administration tried to tackle this menace by establishing
the Agricultural Transformation Agenda (ATA) under Dr. Akinwunmi
Adesina, the current African Development Bank (AFDB) President. The ATA
essentially called for people to start treating agriculture like a
business by integrating food production, storage, processing and
industrial manufacturing through value chains, focusing on sectors where
Nigeria had a comparative advantage. It also included plans to adopt
import substitution measures to drive sector growth and
investment-driven strategic partnerships with the private sector.
Adesina’s major achievement and the hallmark of his tenure was the
Growth Enhancement Support Scheme (GES) for fertilizer and seed
distribution. This ended nearly four decades of corruption by
eliminating direct procurement and distribution of seeds and fertilizer,
enabling private sector seed and fertilizer companies to sell directly
to farmers. As a database of around 15 million farmers was developed,
along with an email wallet for input delivery, the need for middlemen
was erased. Unfortunately, as it now stands, the previous administration
ended up owing millions of dollars to fertilizer and seed companies.
Still, this policy should be continued, along with the Staple Crop
Processing Zone (SCPZ) concept, which strives to boost import
substitution and create wealth for farming communities. The SCPZ will
enhance the development of rural farming neighborhoods through the
building-up of modern processing capacity in agricultural production
clusters. Through this process, farming productivity in such clusters
will be supported in order to sustain processing needs and creating
structured markets through organized linkages between farmers and
processors. Thirteen such zones were to be created to absorb production
in a scheduled manner and address the perennial problems of post-harvest
losses. However, most have been created in name only, with minimal
impact. It would be good for the incoming minster to fine-tune the SCPZs
to fix these deficiencies.
In the area of financing, the government introduced the Fund for
Agricultural Finance in Nigeria (FAFIN), which will serve small-holder
farmers and agribusinesses and the Nigeria Incentive-Based Risk Sharing
System for Agricultural Lending (NiRSAL), a Nigerian Central Bank
single-digit financing framework for agriculture. The government also
provided fiscal incentives to encourage domestic import substitution,
including 0 percent duty on agricultural machinery and equipment
imports, pioneer tax holiday for agricultural investments, duty waivers
and other industry-related incentives to support the private sector.
This should be improved as well because its impact so far has been
minimal and is seen not to be inclusive enough.
In a nutshell, I would rate the last administration as average, but
the current administration should endeavor to walk the walk and dwell
less on the rhetoric and grandiose plans of their predecessors. The
environment must be conducive to business as agriculture has a long
gestation period and the government should be consistent in policy
formulation and be an enabler instead of a participant in this endeavor.
Foodfarmnewstv
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