Nigeria Spent Over N7.8trn On Food Importation In Six Years
Despite being touted as the food basket of Africa, Nigeria has spent over N7.8 trillion in the past six years on food import.
The staggering sum, experts say, is a clear demonstration that the Nigerian government is yet to put the nation on the right path of eradicating hunger by 2030 as stipulated by the United Nations Sustainable Development Goals (SDGs).
According to the National Bureau of Statistics (NBS), over N1.9 trillion worth of food imports business transactions were conducted in 2022 as against the N2 trillion expended on food importation in 2021.
In 2020, the country imported N1.2 trillion worth of agricultural products and imported over N959 billion food products in 2019. Nigeria also imported N857.6 billion and N886.8 billion worth of food products in 2018 and 2017 respectively.
To address this challenge, the former President, Federal Republic of Nigeria, Muhammadu Buhari, launched the Anchor Borrower Programme in 2015, with aim to empower farmers with funds and essential inputs to boost their productivity.
The beneficiaries of ABP are smallholder farmers and medium to large-scale farmers engaged in the production of agricultural commodities across the country.
Meanwhile, Nigeria’s food import bill has been on the rise in recent years. In 2022, a total of N1.9 trillion worth of food products were imported into the country. The value of food imports in the second quarter of 2022 stood at N464.45 billion, showing an increase when compared to the value recorded in the previous quarter.
According to a report by the Central Bank of Nigeria (CBN), Nigeria’s food import bill jumped by 45 per cent to $2.71 billion (N1.12tn) in 12 months.
The rise in food prices in sub-Saharan Africa, is partly due to global factors, as the region imports most of its top staple foods.
The high food import bill is a concern for Nigeria’s economy. The country has a large agricultural sector, and there have been efforts to boost local production to reduce the dependence on food imports. However, factors such as inadequate infrastructure, insecurity, and climate change have hindered progress in the sector.
The National president, All Farmers Association of Nigeria (AFAN), Kabir Ibrahim believe the ABP failed because it did not target the real farmers.
“You can actually see the colossal failure in terms of the scheme. I am sure they do not even have the total number of beneficiaries of the ABP. Even the rice people, the leaders were eating up the loans, it was not as if the farmers were even getting the loans. I am not sure that up to 20 per cent of the loans have been paid back,” he said.
He added that the Commercial Agriculture Scheme (CAS) loan under the former CBN Governor, Charles Soludo, was successful in terms of payment because the participating banks had a commitment with CBN and were also responsible for the collection of the loans under the scheme.
In his words: “The loans under the CAS was repaid mostly because the participating banks had a commitment with CBN and the loans were channeled through them and they were responsible for collecting repayment and if there is any default, the CBN will collect the loan from the participating banks.”
He added: “For most of the farmers who used their influence to get the ABP loan, there is no way they can pay back and you know that repayment in agric lending is very difficult unless you carry out the due process before giving out the loan, it is going to be abused because most people now eat from the fund and they do not deploy any part of the fund for farming.”
He urged the present administration to reinvigorate the system by deploying a modification model while also institutionalising the fund in the Federal Ministry of Agriculture.
“There are some good sides of the ABP, but they should deploy modification as well as institutionalise it. The ABP should be institutionalised in the Federal Ministry of Agriculture and it is better channeled through AFAN because we know the farmers. The CBN should also pay the equity in the BoA while some equity should be sold to farmers so that it will actually be a farmers’ bank,” he advised.
On his part, the Chief Executive Officer, Centre for the Promotion of Private Enterprise (CPPE), Muda Yusuf, said the ABP’s focus area was too narrow, saying that the scheme focused a whole lot on rice farmers.
“There was over concentration on rice. The scheme was also lopsided according to the operators in the sector. The bulk of the programme was focused more in the Northern part of the country and there are farmers in other part of the country as well.
Operators also complained that the loans were being given to political farmers, the farmers with the access to the funds were those with political connections while the real farmers were not getting the funds,” he said.
He added: “First of all, the initiative’s focus area was too narrow. It focused a whole lot about rice farmers and agriculture is much more than rice. There are all manners of other crops, we have the fishery, forestry that didn’t get much attention.”
Muda also added that the CBN does not have the capacity to manage retail lending, pointing out that it is a no brainer that about 70 per cent of the loans are still unrepaid.
He stressed that the default rate is very high and there is no guarantee that the apex bank would be able to recover the unrepaid loans.
