Recall that the Central Bank Of Nigeria earlier this year, initiated the “Anchor Borrowers’ Program” (ABP) where it disclosed that between April and May 2022, it released the sum of N57.91 billion under the ABP program to 185,972 new projects in the Agricultural sector.
The funds released were used for the cultivation of Rice, Wheat, Maize, Cassava, etc with the core aim to boost agricultural production, and non-oil exports, so as to reduce food imports in the country and diversify the revenue base.
The 10 products selected by the Central Bank which are; Cassava, Tomato, Maize, Cocoa, Rice, Cotton, Fish, Poultry, Palm Oil, and Livestock/Diary, for special intervention to reduce food importation, has reportedly fallen short of the target contained in CBN’s five-year policy plan (2019-2024).
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Agriculture features prominently in the 5 year plan, supported by the CBN’s Anchor Borrower’s Programme (ABP) with the aim to boost production of the selected 10 products, and also improve Nigeria’s annual non-oil exports from $2 billion to $12 billion by 2023.
Despite the CBN spending a whopping N1.01 trillion under the ABP program since its inception to provide millions of smallholder farmers with loans and improved seedlings, food importation in the country has continued to hit a new high yearly.
According to data from the National Bureau Of statistics, it revealed that the value of food imports hit N2 trillion in 2021 last year, which is up to 41 percent when compared to the N1.2 trillion spent in 2020. This implies that Nigeria imported agricultural products valued at N1.97 trillion in 2021, surging by 42 year-on-year, compared to N1.19 trillion recorded in the previous year.
This has been reported to represent the highest amount on record spent on agricultural imports in any year. In 2019, the country imported N959 billion worth of food, accounting for 5.66 percent of total imports. It imported N857.6 billion and N886.8 billion worth of food products in 2016 and 2018 respectively.
In the first quarter of 2022, Nigeria imported N44.3 billion worth of food, representing an increase of 8.39 percent when compared to the corresponding quarter in 2021.
The data above-mentioned signifies that food importation in Nigeria has continued to grow at an average of 20 percent since 2019 when the CBN launched the Anchor Borrowers Programme (ABP).
Despite the efforts by the apex bank to improve the country’s agricultural sector, Nigeria has continued to spend a huge chunk of its scarce fx resources on the importation of Agricultural products.
The agricultural sector, which is the largest sector of the Nigerian economy, accounting for 25.9% of the country’s GDP, has been unable to meet local demands, much less earning significant FX from exportation.
Few experts have disclosed that issues such as the insecurity crisis, which has led to over 60 percent of food production lost in the Northern part of Nigeria, have continued to ravage the agricultural sector thereby reducing production output.
In 2021, no fewer than three million hectares of farmlands of Rice, Maize, and Cassava, among others across the country were impacted by insecurity, which took a great toll on the production output causing heavy reliance on food imports.
Some other experts have disclosed that Nigeria can only record success and meet the N5.1 trillion non-oil export target if the agricultural sector becomes market-oriented through value addition.
According to them, more wealth and employment are generated in value chains that are closer to the consumers, and processing to retailing of any agricultural commodity chain accounts for 80 percent of the entire profits of produce. They referred to the likes of Brazil and Vietnam, stating that their agricultural sector grew through value addition, and have become top exporters of various agricultural commodities.