BOI Bureaucracy Stalls Cottage Processing

cassava processing centre, kogi state

* Depositors Demand Interest 

The dream of Federal Government to reduce the post-harvest loses by the establishment of cottage processing centres across the nation since year 2013 may have been stalled by the Bank of Industry (BOI), as processor depositors of Five Hundred Thousand Naira (N500.000.00) have alleged the bank of non-compliance to the Memorandum of Understanding (MOU) between her and Federal Ministry of Agriculture and Rural Development (FMARD), just as they have demanded for the interest on their money from the date of deposit.

 

This revelation came up at the recently concluded 2^nd investors’ meeting and workshop organized by the FMARD at the Institute for Agricultural Research and Training ( IAR&T), Moorplantaion, Ibadan where the beneficiaries have demanded interest from BOI, being loan deposited to benefit from the N10 million loan-grant initiated by the FMARD at the single digit towards owing a modern cottage processing centre for value addition. 

 The cottage industry, initiated during the tenure of Dr. Akinwunmi Adesina to address farmers’ challenges on wastages and marketing through processors off taker for value addition that would attract more local and international markets, thereby creating job and wealth for the youths at rural areas, as the aim is to position agriculture as business with the use of small cottage processing factories of N10m payable loan within 5yrs at single digit of 8%, and grant of 45% component.

But the non-compliance of the BOI to MOU conditions according to the beneficiaries has stalled work on the project site as they claimed that money were not released to execute the completion as being envisaged.

Pastor Taiwo Oluwasegun, the General Secretary (SG) of the Cassava Cottage Processing and Marketing Association disclosed to us that his association has enjoyed the support of FMARD through equipment availability at a subsidized amount to help the beneficiaries to achieve more, even without the help of the BOI.

The CACPMA general secretary said that the commitment/ equity fee of N500, 000.00 paid by every beneficiary to fast track the collection of 9.5million from the BOI has lingered for the period of five years, without payment or refund from the bank as many contractors have stopped executing the project at hand because there was no more fund to finish, noted that the BOI needs to repackage itself to meet up building a better cottage processing industry as signed in the MOU with the ministry.

Another beneficiary from Abia state, Mr. Nwanevu Christopher said that the cottage crops processing factory programme’s objective is to advance local standard products for global market and to overcome rejection by the other countries, saying standardization of processed agricultural crops would break the barriers of trade limitation, while he added that the 28 factories that was supposed to have been developed for the period of four years have been delayed more than expected due to the refusal of the BOI to release fund.

In his response, the BOI official, Mr. Mike Oye identified the issues affecting the expansion of the cottage industry as self-made as there are cases of many complaints from the beneficiaries to the bank, stating that his bank has been acting on the instruction of the ministry.

The south west regional director, Mrs. C A Awe, while reading the Permanent Secretary’s address restated that the present administration was determined to achieve the cottage crop processing industry saying that the ongoing increase in production needs to be matched with better processing facilities to prevent wastage and ensure a pass of any market test.

She however urged the cottage crops processing factory owners to become more visible as a business group that would be well supported by government policy towards grassroot empowerment to boosting national economic growth with job creation, increase in the gross domestic product with 70 percent of the rural people being active in the formal and informal activites, and a 50% post-harvest reduction occasioned by poor handling from processing, packaging, storage and transportation.

Food Farm News gathered that FMARD is already strategizing effective method aimed towards achieving the success of the cottage industry in cassava, oil palm, rice and other crops in the value chains towards products quality/standard vigorously, market exploitation (local and international) for economic power creation in the country as government is urged to put more money in the Bank of Industry (BOI) for people to get more benefits.   

The representative of Deputy Director, Federal Department of Agriculture (FDA) irrigation and crop development division, Engr. A. Ageh reiterated Ministry’s passion to checkmating post-harvest loses of farmers, and making sure an effective policy to ensure standard processed agricultural foods are made available for further processing to off takers, adding there is need for this effort to be complemented by fund availability from BOI so that the collaboration will not suffer as a result of lack of fund.