Emefiele’s Devt Focus Boosts Rice, Wheat Production

Paul K. Adegboyega
Recently, the Governor of the Central Bank Mr. Godwin Emefiele, the Minister of Agriculture and Rural Development, Chief Audu Ogbeh were in Kebbi State to inspect wheat and rice farms under the Anchor Borrowers Programme of the Central Bank of Nigeria. Led by the Governor of Kebbi, Alhaji Atiku Bagudu, Mr. Emefiele and the team carried an on-site assessment tour of some the large farms operated by the over 70,000 farmers being encouraged under the program.

Kebbi state is one of the largest rice producing states in the country. This year alone it is projected to produce about 1 million metric tonnes of rice making it a critical part of the Central Bank’s plan to stimulate local productive capacity so as to reduce food imports, reduce foreign exchange pressure on the naira, create jobs and grow the local economy.

Speaking to journalists after the inspection tour, the CBN governor said “we have gone round the farms; we got to a place called Suru local government where over 12, 000 farmers were registered under the Anchor Borrowers Programme and over 40,000 kilometers of rice farms have been cultivated. We also stopped somewhere close to Suru where wheat is being harvested. Now we are seeing the reality in Kebbi, that wheat can be cultivated and grown in Nigeria”.

According to him, 78,000 farmers have so far benefitted from the Anchor Borrowers Programme and the CBN gave them a minimum of N210,000 to cultivate a hectare of land. “Thirteen states would be involved in the rice programme particularly during the rainy season. We would begin from the South-east states of Anambra, Ebonyi, Cross -River, Benue and Plateau. We would also engage northern states of Zamfara, Kaduna and Katsina”, he said.

The assessment tour is significant. It serves as practical proof that the CBN Governor beyond the rhetoric and policy prescriptions on stopping imports of goods that could be produced locally, building local productive capacity and creating jobs is indeed ready to step out of the comfort of his office into the heat of the real field to get the job done. The visit also shows his commitment and that of the federal government towards ensuring that the key objectives of the Anchor Borrowers Program are attained.

That he is matching words to action and monitoring closely to see the translation of policy into farms on the ground in places far from Abuja is commendable. The country is in an emergency situation and the actions of its key policy drivers must be seen to reflect the urgency for quick action. Thus, all hands must be on deck and all sleeves rolled up to ensure that we move with speed towards the solution, which we all are now agreed on.

Now, the Anchor Borrower’s Program which was flagged-off by President Muhammadu Buhari in November last year at Zauro, near Birnin Kebbi for dry season rice farming is one of the several CBN intervention programs that are designed to boost local productive capacity. It seeks to create economic linkages between farmers and processors, not only to ensure increased agricultural output of rice and wheat, but to also close the gap between production and consumption.

Under the programme, the CBN has set aside N40bn out of the N220bn Micro Small and Medium Enterprises Development Fund to be given to farmers at single digit interest rate of nine per cent per annum.

As part of the scheme’s offering, smallholder farmers are entitled to loans ranging from N150,000 to N250,000 to assist them in procuring necessary agricultural inputs like seedlings, fertilizers, pesticides, among others, to help boost agricultural outputs and productivity.

So far the CBN has given out N4.9billion in loans under the scheme. A total of 78,581 farmers have been mobilized in Kebbi with a total of 570,000 direct jobs created in the process. Relatedly, about 70,871 rural farmers now own and operate bank accounts and captured under the Bank Verification Number (BVN) biometric project and timely supply of inputs to 73,001 farmers.

It would be recalled that from January 2012 to May 2015 the country spent over 2.41bn dollars on importation of rice. This negative trend resulted in huge stock of paddy rice cultivated by local farmers and the low operating capacities of many integrated rice mills in the country. Relatedly, from the fourth quarter of 2014 to the third quarter of last year alone, Nigeria spent $1.14bn (N227.78bn), while rice imports drained $591.47m (N117.85bn).

With the progress that is being made with the implementation of the Anchor Borrowers’ Program, the likelihood of Nigeria achieving self-sufficiency in the local production of rice and wheat seems more probable. It is also proving critics of Emefiele’s foreign exchange policies wrong and showing more than ever that a lot can be achieved in Agriculture if local farmers are given the necessary government support and incentives. It also shows that Nigeria has the capacity to produce most of the goods that it imports using its hard earned foreign exchange.

Besides the Anchor Borrowers program which focuses on boosting rice and wheat production, the CBN has also implemented a series of direct financial interventions which are meant to stimulate growth of critical sectors of the economy. One of these is the N300bn Real Sector Support Facility (RSSF). One of the beneficiaries of this facility is Psaltery International Limited. The company which specializes in producing starch for breweries who before now relied on imported starch secured an N850 million loan which it has used to expand its operations, increase its output and increase its workforce.

Other CBN strategic interventions in critical sectors of the economy include the N220bn Micro-Small and Medium Enterprises Development Fund; N75bn Nigeria Incentive-Based Risk Sharing System for Agricultural Lending – from where the Anchor Program is funded and the N213bn Nigeria Electricity Market Stabilization Fund whose aim to help stabilize the electricity industry. The CBN has also set up a N50bn Nigeria Export Import Bank Fund and the N500bn Export Refinancing and Restructuring Facility with focus to boost the country’s exports. Not too long ago, the CBN disbursed N350 billion to the Nigerian Export Import Bank (NEXIM). The fund is meant to boost the country’s exports by proving low interest financial to local companies. All these are helping to bridge the financial handicap which has held down manufacturing growth for decades. It is estimated that the Central Bank has so far committed over 1.3trillion naira towards providing credit to the real sector of the economy.

These historic initiatives that are being spiritedly pursued by the Central Bank Governor, with the active political support of the President, if continued and sustained within the next couple of years would help to greatly re-calibrate the nation’s economy, diversify its resource base and give it the necessary internal resilience to withstand external shocks especially as a result of the volatility in oil prices which we are currently experiencing.

While the prices of oil in the international market have steadily inched up in recent times to record highs of $48 and there is a strong likelihood of it hitting the $50 mark, they can only help to bring temporary or short term stability to the current economic crunch. On the long term, it is only a domestic focused policy – like the one being implemented by Emefiele – that focuses on growing local industry, boosting local production would help to strengthen our economy and ignite sustainable growth.

– Adegboyega is a policy analyst