The World Bank has lamented Nigeria’s over-dependence on oil and neglecting the agricultural sector where about 4 crops could fetch the country about $10 billion annually
The Senior Agriculture Economist, World Bank, Dr Adetunji Oredipe, who disclosed this while delivering a keynote address at the Agriculture Summit Africa sponsored by Sterling Bank Plc, held in Abuja., said the neglect of the agriculture sector when Nigeria’s economy became increasingly dependent on oil has proved to be a disaster.
He noted that if Nigeria had explored the potentials of some value chains like palm oil, cocoa, groundnut and cotton, the country would be earning at least $10bn annually from the four commodities.
The World Bank representative further said that Nigeria is now one of the largest food importers in the world.
“In 2016 alone, Nigeria spent $965m on the importation of wheat, $39.7m to import rice and $100.2m on sugar importation”, he said.
He said spending $655m on fish importation appears like financial recklessness, considering the huge marine resources, rivers, lakes in Nigeria.
“None of the above transactions (importation of rice, fish, sugar) is fiscally, economically, or politically sustainable.
“Nigeria is tragically is living on borrowed time, a typical case of robbing Paul to pay Peter.
“For instance, each time we spend money to import rice, Nigerian local rice farmers are negatively affected in terms of morale, sales, and realizable income’, he noted.
On his part, Kebbi State Governor, Atiku Bagudu, urged commercial banks to increase their loan portfolio to the agricultural sector, adding that investing in agriculture is not as risky as other sectors that benefit up to 90 per cent loan facilities.
The Kebbi State Governor who is also the Chairman, Presidential Task Force Committee on Rice and Wheat Production, expressed concern that besides Sterling Bank, which had dedicated 10 per cent of its total loan portfolio to the agricultural sector, other commercial banks only dedicate one or two per cent of their total loan portfolio to the sector.
The summit with the theme, “Agriculture: Your Piece of the Trillion-Dollar Economy” had about 2000 participants, with representatives from the US and over 30 participants from other African countries among others.
Gov Bagudu also expressed concern that in spite of efforts to reposition agriculture in Nigeria, the support from stakeholders was not encouraging.
According to him, “commercial banks believe that it is risky investing in agriculture, “not knowing that it is the safest sector to invest in.”
While commending Sterling Bank and other stakeholders for their support to the federal government in making the desire for agriculture in the country a reality, he said many commercial banks do not realise that lending to agricultural sector will ensure safer banking and more prosperous society.
He noted that if agriculture was only one or two per cent of a bank’s portfolio, the staff of such banks may follow same priority, with little chance for someone in the agriculture department had the opportunity to head such bank.
He also called policymakers to be alert to activities in the international markets to come up with policies that would place the country at an advantage globally, noting that there were so many distortions caused by wealthy countries to continue to control the market.
“It is important, we put pressure to improve loan portfolio in agriculture and encourage banks and other major stakeholders to put their best brains in agriculture.
“Over the last three years I have interacted with Sterling Bank and it shows how much there is to do, how much value addition is there to achieve and how much money there is to make in the sector.
“We have good brains that can help us figure out how to fund agriculture and the evidence is out there that agriculture is not as risky as those sectors that benefit up to 90 per cent loans from banks,” he said.
He stressed that Nigerians had seen a federal government that was willing to engage stakeholders at all levels.
According to him, some of the evidences that the present government has agriculture at heart are, President Muhammadu Buhari chairing the Food Security Council and playing host to major stakeholders in the sector.
He also listed the Presidential Task Force and the Fertiliser Initiative that had helped with adequate and qualitative fertilizer.
He further stated that about N174 billion had been invested in Anchor Borrowers Programme since inception, adding that it had benefitted so many farmers and stakeholders in the agriculture value chain in the country.
The governor said if properly harnessed, the sector had the capacity of helping in the recovery of Nigeria from recession, adding that “while other sectors were doing one per cent during recession in the country, agriculture was making up to 3 per cent.
“Agriculture is where to make money but there must be collaboration to support stakeholder to compete internationally and account and financial engineering that will help them compare with participants in other countries and compete favourably.
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