As Nigeria joins other nations to mark World Food Day today (October 16), with the theme, ‘Change the future of migration. Invest in food security and rural development,’ it is instructive to spotlight the role by Central Bank of Nigeria (CBN) in actualising the country’s commitment towards food sufficiency, rural development and stemming rural-urban migration. The apex bank is also determined to see Agriculture positioned as Nigeria’s alternative foreign exchange (forex) earner to oil and gas; while meeting the growing raw material needs of local industries.
The Bank has played this remarkable role through various Intervention Fund programmes targeted at indigenous small and medium enterprises (SMEs), including those in the agriculture value chain. The intervention policy was introduced in 1977 to create jobs, expand the real sector and boost the nation’s gross domestic product (GDP). It has remarkably addressed potential and identified constraints experienced by Nigeria’s 17 million SMEs in accessing funds meant for their development. The intervention scheme has gulped about N3 trillion during the 40 years it has existed.
The micro-schemes created under the CBN intervention policy are all sector-specific. They include the Agricultural Credit Guarantee Scheme (ACGS); Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL); Commercial Agriculture Credit Scheme (CACS); the N220 billion Micro, Small and Medium Enterprises (MSME) Fund; and the Anchor Borrowers’ Programme.
Others are the Small Medium Enterprise Credit Guarantee Scheme (SMECGS); the added N2-billion interest rebate funds under the revolving Interest Draw Back (IDB) of the ACGS Fund and strict supervision of operations of microfinance banks. Additionally, the CBN directed (and is monitoring) the establishment of agricultural desks at all deposit money banks (DMBs). Since February 20, 2017, the apex bank has engaged in aggressive funding of the sub-sector through its multi-window forex intervention regime that has gulped $10 billion as at date – focusing on Wholesale, Investment & Exports, SMEs, Invisibles and Bureau the De Change (BDCs) segments, among othes.
In line with its transparency trajectory, the Bank publishes several reports of its activities under the intervention initiative. According to its monthly Economic Report for May 2017 (which is the latest), a total of N424.6 million was guaranteed to 4,029 farmers under the ACGS in May 2017. Sub-sectoral analysis showed that the food crops received the largest share of N226.1 million (53.3 per cent) guaranteed to 2,699 beneficiaries, livestock got N62.2 million (14.7 per cent) guaranteed to 282 beneficiaries, while cash crops sub-sector received N44.4 million (10.5 per cent) guaranteed to 221 beneficiaries. The mixed crops received N42.2 million (9.9 per cent) guaranteed to 597 beneficiaries while N38.3 million (9.0 per cent) was guaranteed to 137 beneficiaries, in the fisheries subsector, ‘others’ had N11.2 million (2.6 per cent) guaranteed to 93 beneficiaries.
With this unyielding commitment on the part of the CBN, it is obvious that any development injurious to the intervention fund schemes would promptly raise genuine concerns; otherwise, it would portray the Federal Government as blowing penny whistle in its diversification bid. This explains the worries in certain quarters over reports of poor quality supply of Nigeria’s export produce in recent times. Analysts maintain that the development is a sad commentary on government effort, through the CBN and other agencies, to make Agriculture play its role in growing the nation’s Gross Domestic Product (GDP).
For instance, some consignments of yams exported by Nigeria to the United States of America (USA) recently, were rejected by that country for being of “poor quality”. The development, expectedly, infuriated Chief Audi Ogbe, Nigeria’s Minister of Agriculture & Rural Development. Ogbe had, about three months earlier, engaged in a near-Champaign pop to celebrate what seemed a historic landmark in Nigeria’s diversification effort towards up-scaling agriculture as a viable forex earner. Nigeria had in July exported 72 metric tonnes of yams to the United States, United Kingdom (UK), and China which attracted wide media attention at the time.
Elated Ogbe had disclosed that Nigeria targeted a yearly revenue boost of eight billion Dollars from yam export alone, a move that would create massive jobs for Nigerians and restore agriculture as Nigeria’s economic mainstay. “We are returning agriculture to its pre-oil boom era when the sector was the nation’s economic mainstay,” Ogbe was quoted as telling members of the Technical Committee on Nigeria Yam Export Programme in Abuja when the group launched its programme in June. Ogbe had also predicted that the programme would enable the country to earn forex from agriculture products to de-emphasis dependence on oil and gas sector.
Expectedly, the rejection of (unspecified volume of) Nigeria’s yam export by authorities of the United States, was a source of grave concern to Ogbe. The Hon. Minister had vowed to see to it that those responsible for the act of “national embarrassment” did not go unpunished. “Some consignments of yams were exported from Nigeria to the United States and according to reports we have today, they were found to be of poor quality. We will be investigating both the company that exported it and our quarantine department to check and find out why such a consignment left here”, Ogbe was quoted as saying in a note of anger last week.
But that was not the first time Nigeria’s agricultural exports would be rejected. The European Union in 2016 rejected a total of 24 food products exported from Nigeria for failing to meet stipulated standards. According to Abubakar Jimoh, then Director-General of National Agency for Food & Drug Administration and Control (NAFDAC), the affected products included palm oil, dried fish, beans, groundnuts, sesame and melon seeds. Each of these items had their specific quality and standard deficits. For instance, Nigeria’s groundnut was said to contain aflatoxin while palm oil contained a colouring agent found to be carcinogenic.
Government concern over these anomalies was reinforced by the fact that many agencies were charged with the responsibility of ensuring that agricultural commodities exported from Nigeria meet the required standards and quality by having them properly checked and certified. The agencies include the Nigerian Ports Authority (NPA), Nigerian Customs Service (NCS), Federal Airports Authority of Nigeria (FAAN), and NAFDAC. Others are Standards Organisation of Nigeria (SON), Nigerian Export Promotion Council (NEPC), Nigerian Agricultural Quarantine Service (NAQS), Central Bank of Nigeria (CBN), and National Agricultural Seed Council (NASC). While Ogbe’s anger is understood, it is expected that appropriate proactive steps will be taken to see to it that government efforts to boost agriculture do not end a pipe-dream.
It is reassuring that government is determined to institute synergies between rural and urban dwellers by addressing the yawning infrastructure gap that has plagued developmental efforts. The Ministry of Agriculture and Rural Development is fast-tracking SME development leveraging on the fast-growing pace of the agricultural sector. The Economic Recovery and Growth Plan (ERGP), a blueprint of government’s strategic plan towards diversifying and repositioning the economy on the path of sustainable growth, has Agriculture as one of its pillars.
By Sam Diala,
Leadership News
The Bank has played this remarkable role through various Intervention Fund programmes targeted at indigenous small and medium enterprises (SMEs), including those in the agriculture value chain. The intervention policy was introduced in 1977 to create jobs, expand the real sector and boost the nation’s gross domestic product (GDP). It has remarkably addressed potential and identified constraints experienced by Nigeria’s 17 million SMEs in accessing funds meant for their development. The intervention scheme has gulped about N3 trillion during the 40 years it has existed.
The micro-schemes created under the CBN intervention policy are all sector-specific. They include the Agricultural Credit Guarantee Scheme (ACGS); Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL); Commercial Agriculture Credit Scheme (CACS); the N220 billion Micro, Small and Medium Enterprises (MSME) Fund; and the Anchor Borrowers’ Programme.
Others are the Small Medium Enterprise Credit Guarantee Scheme (SMECGS); the added N2-billion interest rebate funds under the revolving Interest Draw Back (IDB) of the ACGS Fund and strict supervision of operations of microfinance banks. Additionally, the CBN directed (and is monitoring) the establishment of agricultural desks at all deposit money banks (DMBs). Since February 20, 2017, the apex bank has engaged in aggressive funding of the sub-sector through its multi-window forex intervention regime that has gulped $10 billion as at date – focusing on Wholesale, Investment & Exports, SMEs, Invisibles and Bureau the De Change (BDCs) segments, among othes.
In line with its transparency trajectory, the Bank publishes several reports of its activities under the intervention initiative. According to its monthly Economic Report for May 2017 (which is the latest), a total of N424.6 million was guaranteed to 4,029 farmers under the ACGS in May 2017. Sub-sectoral analysis showed that the food crops received the largest share of N226.1 million (53.3 per cent) guaranteed to 2,699 beneficiaries, livestock got N62.2 million (14.7 per cent) guaranteed to 282 beneficiaries, while cash crops sub-sector received N44.4 million (10.5 per cent) guaranteed to 221 beneficiaries. The mixed crops received N42.2 million (9.9 per cent) guaranteed to 597 beneficiaries while N38.3 million (9.0 per cent) was guaranteed to 137 beneficiaries, in the fisheries subsector, ‘others’ had N11.2 million (2.6 per cent) guaranteed to 93 beneficiaries.
With this unyielding commitment on the part of the CBN, it is obvious that any development injurious to the intervention fund schemes would promptly raise genuine concerns; otherwise, it would portray the Federal Government as blowing penny whistle in its diversification bid. This explains the worries in certain quarters over reports of poor quality supply of Nigeria’s export produce in recent times. Analysts maintain that the development is a sad commentary on government effort, through the CBN and other agencies, to make Agriculture play its role in growing the nation’s Gross Domestic Product (GDP).
For instance, some consignments of yams exported by Nigeria to the United States of America (USA) recently, were rejected by that country for being of “poor quality”. The development, expectedly, infuriated Chief Audi Ogbe, Nigeria’s Minister of Agriculture & Rural Development. Ogbe had, about three months earlier, engaged in a near-Champaign pop to celebrate what seemed a historic landmark in Nigeria’s diversification effort towards up-scaling agriculture as a viable forex earner. Nigeria had in July exported 72 metric tonnes of yams to the United States, United Kingdom (UK), and China which attracted wide media attention at the time.
Elated Ogbe had disclosed that Nigeria targeted a yearly revenue boost of eight billion Dollars from yam export alone, a move that would create massive jobs for Nigerians and restore agriculture as Nigeria’s economic mainstay. “We are returning agriculture to its pre-oil boom era when the sector was the nation’s economic mainstay,” Ogbe was quoted as telling members of the Technical Committee on Nigeria Yam Export Programme in Abuja when the group launched its programme in June. Ogbe had also predicted that the programme would enable the country to earn forex from agriculture products to de-emphasis dependence on oil and gas sector.
Expectedly, the rejection of (unspecified volume of) Nigeria’s yam export by authorities of the United States, was a source of grave concern to Ogbe. The Hon. Minister had vowed to see to it that those responsible for the act of “national embarrassment” did not go unpunished. “Some consignments of yams were exported from Nigeria to the United States and according to reports we have today, they were found to be of poor quality. We will be investigating both the company that exported it and our quarantine department to check and find out why such a consignment left here”, Ogbe was quoted as saying in a note of anger last week.
But that was not the first time Nigeria’s agricultural exports would be rejected. The European Union in 2016 rejected a total of 24 food products exported from Nigeria for failing to meet stipulated standards. According to Abubakar Jimoh, then Director-General of National Agency for Food & Drug Administration and Control (NAFDAC), the affected products included palm oil, dried fish, beans, groundnuts, sesame and melon seeds. Each of these items had their specific quality and standard deficits. For instance, Nigeria’s groundnut was said to contain aflatoxin while palm oil contained a colouring agent found to be carcinogenic.
Government concern over these anomalies was reinforced by the fact that many agencies were charged with the responsibility of ensuring that agricultural commodities exported from Nigeria meet the required standards and quality by having them properly checked and certified. The agencies include the Nigerian Ports Authority (NPA), Nigerian Customs Service (NCS), Federal Airports Authority of Nigeria (FAAN), and NAFDAC. Others are Standards Organisation of Nigeria (SON), Nigerian Export Promotion Council (NEPC), Nigerian Agricultural Quarantine Service (NAQS), Central Bank of Nigeria (CBN), and National Agricultural Seed Council (NASC). While Ogbe’s anger is understood, it is expected that appropriate proactive steps will be taken to see to it that government efforts to boost agriculture do not end a pipe-dream.
It is reassuring that government is determined to institute synergies between rural and urban dwellers by addressing the yawning infrastructure gap that has plagued developmental efforts. The Ministry of Agriculture and Rural Development is fast-tracking SME development leveraging on the fast-growing pace of the agricultural sector. The Economic Recovery and Growth Plan (ERGP), a blueprint of government’s strategic plan towards diversifying and repositioning the economy on the path of sustainable growth, has Agriculture as one of its pillars.
By Sam Diala,
Leadership News
