The Federal Government recently underscored its commitment to the diversification of the economy with the approval of a N750 billion Agriculture Intervention Fund to be managed by the Central Bank of Nigeria (CBN). The cheering news was broken by Heineken Lokpobiri, Minister of State for Agriculture, at the 2016 National Summit of the Poultry Association of Nigeria (PAN). Agriculture is a veritable route out of the present economic quagmire precipitated by our unwise over-dependence on oil. It is one of our strongest areas of economic strength and government is right to focus on it in a bid to diversify the economy.
We welcome this new commitment to agriculture. It is a sector which served the nation very well in the past, especially in the years before and immediately after our independence. As government re-traces its steps, and learns from the experiences of nations where food security promotes national security and development, we urge it to move forward with good planning and disciplined execution of identified programmes.
Let government take necessary steps to make the N750bn intervention fund available for disbursement. We are not unaware that similar plans made by some of our past governments were never executed. We urge the government to ensure that this fund and others still in the pipeline such as Jaiz Bank’s $2.5 million and another undisclosed amount from the African Development Bank (ADB) are made available to our farmers.
We recall that the former President Goodluck Jonathan administration similarly focused on agriculture in its bid to diversify the economy, and it recorded modest successes, especially in cassava and rice production.
The proposed N750bn is a lot of money. It has to be properly managed if it is to have the desired impact on the lives of the citizenry and the national economy. What this will require is for government and relevant stakeholders to painstakingly determine the special intervention areas the new fund will be deployed into and the expected outcomes. Just how much of the money should go into crop farming, for example? Which are the crops we are prioritizing and for what purpose? As Dr. Ayoola Oduntan, President of PAN, disclosed at the event, the government does not often consult widely enough before taking such decisions. This is wrong and should be quickly corrected, especially at this time that synergy is required to achieve the desired results in this critical sector of the economy.
It is good that government is making efforts to make this fund accessible and attractive to the people who really need it. One reason farmers find it difficult to obtain credit facilities in commercial banks is the high interest on loans which is unrealistic for agricultural purposes. The plan, therefore, to make the present fund available to farmers at less than six per cent interest rate is commendable. We hope that in subsequent years, efforts will be made to further lower the rate below three per cent as presently obtains in the most developed agricultural societies.
Having secured the fund, government must work hard to ensure that it does not go the way of other intervention funds in our recent history. We recall with pains, the good intentions of government in the establishment of special intervention funds, some of which later became slush funds for unconscionable public officers. It is, therefore, no surprise that they did not make the desired impact.
As a corollary, government must put in place workable modalities to secure this intervention fund. All benefiting farmers must know from the outset that the loans must be paid back. The inability of government to recover agricultural loans in the past made financial institutions to list such loans as high risk. The time has come to correct this poor perception of agricultural credit. The ability to secure and grow this fund for sustained intervention in the agricultural value chain is key to our breakthrough in the sector.
Government should be reminded about rural development as a cardinal policy to open up our vast rural areas to the huge potentials of agriculture. Necessary infrastructure such as good access roads, electricity, water and irrigation as well as transportation should be provided to support rural farmers. For agriculture to be truly attractive to our teeming unemployed youths, it must be mechanized and brought completely in tune with modern trends. Again, the examples from successful agricultural nations like the USA and Israel should serve us well in this regard.
To ensure total and integrated development of agriculture, all the states are advised to key into this Federal Government initiative. We are encouraged by the recent outing of the North-West Governors Forum on agriculture. In the South-West, a template for collaboration already exists from the Western Region days when agriculture was the mainstay of the economy of the region and that of the entire country. With effective use of the Agriculture Intervention Fund and other such initiatives, the country should be able to go back to the days when agriculture was the pillar of the economy.
Nigeria can be financially strong again and enjoy food security if we give agriculture the pride of place it deserves.