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Anchor Borrowers’ Programme: Transforming agric sector in 2 years

Anchor Borrowers’ Programme: Transforming agric sector in 2 years

Asst Business Editor

Barely two years after the launch of the Anchor Borrowers Programme (ABP) to support the nation’s agricultural sector by the Central Bank of Nigeria (CBN), indications are rife that the initiative has supported Nigerian farmers, thereby yielding more returns in rice farming.

Following the successes recorded so far, the programme has been extended to poultry farmers with 10 poultry farmers registered under Nigeria’s foremost broiler out-grower scheme, natnuPreneur, recently became the first beneficiaries of the CBN’s poultry ABP, kick starting the pilot phase of this CBN initiative.The farmers took delivery of 1,000 birds each in a ceremony, which held at Erikorodo farm settlement, Ikorodu, Lagos recently.This pilot phase was part of CBN’s commitment of realizing the food security goal of the Federal Government.

As at June 2017, under the scheme, the Federal Government, through the CBN, has so far invested about N33 billion in 21 states with Kebbi, Cross River, Kano, Jigawa and Anambra, Ogun, Niger, Benue, and Kaduna states taking the lead.However, contrary to the insinuation that benefiting farmers under the scheme were unwilling to pay the apex bank said, over N7 billion have been repaid from the loans, stressing that details of the loan disbursement and repayment as at March 31 was that the farmers have so far repaid about N7.119 billion out of a total of N33.34 billion released to them. According to CBN, the loans were disbursed through the 12 participating financial institutions to 146,557 farmers across 21 states cultivating over 180,018 hectares of land.

CBN maintained that the scheme has already boosted agricultural production and non-oil exports in the face of unpredictable crude oil prices and its resultant effect on the revenue profile of Nigeria, and has helped to moderate volatility in the foreign exchange rate from anticipated decreases to demand for Forex from increased domestic production of such hitherto imported commodities.The ABP was initiated as a policy option to create an ecosystem that connects smallholder farmers to big processors, thereby creating increased income for the farer, jobs for the unemployed and steady input supply for agro-businesses.Determined to make agriculture the sector where people make money, CBN in 2015 launched the ABP which was equally in line with its developmental function. The programme was flagged off by the President, Muhammadu Buhari on November 17, 2015 and is intended to create a linkage between anchor companies involved in the processing and Small Holder Farmers (SHFs) of the required key agricultural commodities.

Furthermore, the ABP was established to boost local production of rice, wheat and other agricultural products. It serves to create economic linkage between smallholder farmers and reputable large-scale processors, with a view to increasing agricultural output and significantly improving capacity utilization of processors.Also, programme thrust of the ABP is provision of farm inputs in kind and cash (for farm labour) to Small Holder Farmers (SHF) in order to boost production of these commodities, stabilize inputs supply to agro processors and address the country’s negative balance of payments on food, while at harvest, the SHF supplies his/her produce to the Agro-processor (Anchor) who pays the cash equivalent to the farmer’s account.

According to CBN, the Programme evolved from the consultations with stakeholders comprising Federal Ministry of Agriculture & Rural Development, State Governors, millers of agricultural produce, and smallholder farmers to boost agricultural production and non-oil exports in the face of unpredictable crude oil prices and its resultant effect on the revenue profile of Nigeria.Before the introduction of ABP, farmers go to farm rice and all the yield they were getting was one to 1.5 metric tonnes per hectare.Speaking in Jibia, Katsina State, last December at the formal flag–off of the rice dry season farming, the Governor said that Nigeria’s food import bills was exceptionally high and that rice and wheat formed part of four items that consumed a whopping N1.0 trillion in foreign exchange.

Another reason he adduced was that food importation fueled domestic inflation, depleted the nation’s foreign reserves, displaced local production and created unemployment. He noted that import dependency especially on commodities of comparative advantage was neither acceptable nor sustainable.Interestingly, CBN said today “we are beginning to see farmers getting yield as high as eight metric tonnes per hectare, reducing their costs and making it possible to make their money in rice cultivation”, adding that the programme was meant to complement other agricultural programmes. CBN Governor, Godwin Emefiele, while receiving the Forbes’ 2017 ‘Best of Africa Achievement’ award in Washington D.C, recently, affirmed that the central bank will continue to implement policies that would help the Nigerian economy attain sustainable growth.

Speaking further, he said countries that have progressed have done so because they took the agric sector very seriously. “We are determined to make agric the sector where people make money and we have decided to put in place the Anchor Borrowers Programme. We have seen that there is a need for us to think about how we improve the wealth of our rural community. We started that journey and through rice, we have achieved that. The Nigerian government is confident that through agriculture, the wealth of our people can be boosted. And that is the journey we are on”, he stated.

He said Nigeria is a big market, no doubt, 180 million people growing at an average population rate of three per cent annually. “It is certainly a big market. But then, it is important to cast our mind back and begin to ask ourselves: There was a time in Nigeria when we produced everything we were eating. We were producing rice, palm oil etc. Nigeria was the highest producer and exporter of palm oil in the world with over 40 per cent market share sometimes in the 60s and 70s.“But unfortunately because we found oil, we decided to take things easy. What we are saying is that: the President said we had tested this before, we had done it before, it is not about re-inventing it again. Our climate is good, let us fold our sleeves and begin to feed ourselves again, and save our reserves for some of those items that we cannot produce as a country. And that has led to where we are today.

“We are delighted we put forex restriction on 41 items. We were castigated and I was reading in the Economist magazine that what we did was to just move around the home and pick items including toothpicks. I think it is important to know what we are doing. If you go to China, where they are producing the toothpicks, those things can be produced in a place that is less than a quarter of a room. How much does it involve investing in the equipment used in producing toothpicks? “Today, companies that require starch and glucose for their pharmaceuticals and formulations patronize Nigerians. This has created jobs for us. That is the spirit of Nigerians. This is part of the reasons the President said we needed to patronize Made-in-Nigeria and I am happy that we are doing this.

Emefiele said various initiatives the bank had rolled out were to encourage inclusive growth of all sectors and increase wellbeing of the people in the country, while urging Nigerians, especially the political class and opinion leaders to support CBN to financially reposition the country for economic advancement.Other ABP targets achievable by 2021 would be the creation of at least 1,000,000 direct and indirect jobs in the processing segment of the identified value chains; reducing Nigeria’s import bill on the identified commodities by at least 10 per cent annually.

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