That the Governor of Central Bank of Nigeria (CBN), Mr. Godwin Emefiele, prioritised agriculture in his economic diversification policy, became visionary in its conception and a life-saver as COVID-19 hit the world like a tornado.
His decision to expand the scope of his mandate away from strictly monetary policy and financial systems stability to development policies with emphasis on agriculture and exploitation of non-oil minerals of the nation, marked a turning point in the implementation of the economic diversification programme.
Through it, the reactivation of the sector drawing from a basket of incentives using the platform of the Anchor Borrowers’ Programme (ABP), became not only possible but also beneficial to the nation as a whole when the positive fallouts became visible and the impact palpable.
In no time there emerged a reinvigorated interest in agriculture as a business attracting, in the process, huge investment from the private sector, foreign and local. That policy trust also saved the nation billions in foreign exchange that otherwise would have been spent importing food. From a net importer of rice, the country became self-sufficient in the crop.
The policy touched lives of the people in the immediate environment and the country at large as thousands of jobs have continued to be created and millions more empowered on a sustainable basis.
It is instructive to point out that the federal government, as part of its Economic Recovery Programme, had committed to doing all within its financial power to ensure that the aim of retrieving the economy from recession was achieved and sustained.
As Emefiele himself pointed out, “the spread of the virus along with the corresponding containment measures, led to a significant slowdown in global growth in the first half of 2020. Commodity exporting countries like ours also faced significant revenue challenges as commodity prices such as crude oil, dipped by over 65 percent in the 1st half of the year.
“As a result of the downturn in growth, advanced and emerging market countries implemented series of conventional and unconventional measures, aimed at curtailing the spread of the virus and stimulating greater economic recovery. In Nigeria our combined stimulus measures so far is about US$18 billion, which is close to 4.5 percent of our GDP.”
To reinforce the government’s commitment to mitigating the impact of COVID-19, CBN injected in excess of N6 billion into agricultural sector geared towards ensuring food security during the pandemic. This money was disbursed to organised farming groups who formed the core of the agricultural project.
Under COVID-19 and the attendant disruption in economic activities and closure of borders worldwide, it was difficult to find things to buy even if one had the money.
This situation was made worse in the case of Nigeria by a wrenching cash crunch. But with the availability of locally produced rice, maize, wheat, millet, cassava tomato and so on as well poultry and dairy products, life was made a little easier for the people.
There also began to re-emerge pyramids rice, maize in places like Minna, Funtua and Kebbi and in the process brought nostalgic memories of time past when those landmarks used to dot the landscape in parts of the North in the period preceding the nation’s Independence and up the immediate post-independence era.
As a matter of fact, recently, the Kebbi State Government in collaboration with the Central Bank of Nigeria (CBN) unveiled rice pyramids in the state as evidence that with commitment and financial support, sufficiency in food production in the country is possible.
The rice pyramid, the first ever in the country, was displayed to demonstrate that Nigeria can do it by surpassing the Asian countries from where rice imports had bloomed.
It cannot be over-emphasised that a nation that is unable to feed its citizens is waiting for the doomsday. With the competition among the states that the success story in Kebbi State has engendered, in no distant time, Nigeria may be in a position to do away altogether with the importation of rice, maize or other staple products that can conveniently be produced in Nigeria.
In expanding the scope of development financing, the CBN believes that diversifying the Nigerian economy will not only make her self-sufficient in food production and industrial raw materials, but also create jobs for its teeming youth population.
According to Emefiele, the Bank has sustained its intervention efforts in order to help catalyse growth in critical sectors of the economy such as agriculture and manufacturing.
This the Bank has done through intervention programmes such as the hugely successful Anchor Borrowers’ Programme (ABP), the Commercial Agriculture Credit Scheme (CACS), the Bankers Committee Agri-Business/Small and Medium Enterprises Investment Scheme (AGSMEIS) and recently introduced Commodity Development Initiative (CDI), which focuses on developing the value chain of ten focal commodities: Cassava, cocoa, cotton, fish, livestock/dairy, maize, oil palm, poultry, rice and tomatoes.
Following success recorded in the agricultural intervention scheme and in line with efforts to boost food production, the CBN recently disclosed that it set aside about N432 billion to fund the value chains in nine commodities which commenced in the 2020 wet season.
The CBN’s funding of the ABP for the 2020 season was the highest since the inception of the programme in 2015. The proposed funding for the nine commodities was a significant move by the CBN, considering the successes recorded in the 2019 season that contributed to shielding Nigeria from any food shortage, particularly rice during the era of the pandemic.
As indicated earlier, “the agriculture sector was a key driver in taking the Nigerian economy away from negative growth in the 4th quarter of 2020.
It is important that we not only sustain measures aimed at increasing productivity of the sector, but also ensure that we continue to produce items that can be produced locally rather than resorting to imports of these items.”
“More importantly, our agricultural sector also offers significant opportunity for the nation to earn foreign exchange through the exports of processed agricultural products.
Over the next three years, we will continue to encourage the banking sector to increase its loans to the agriculture sector from four percent to 10 percent by 2024,” Emefiele said.
He also disclosed that the apex bank is also “pursuing an in-depth restructuring of the Nigeria Commodities Exchange Board in order to improve access to finance as well as productivity for stakeholders in the agriculture sector.
With enhanced logistics and the provision of warehouse receipts through the Commodities Exchange, farmers will be able to access finance, expand production and supply needed goods to off-takers.
The whole essence of this discourse is to point out how futuristic the Emefiele policy, in particular his intervention in the agriculture sector, has been and will continue to be.
It has not only saved the nation from what would have been a monumental food crisis but also expanded the nation’s economic activity in the sector and unleashed its hitherto dormant job creation potentials and also revealed, in a very significant way, the contributions it is capable of making to the nation’s Gross Domestic Product (GDP).