Fed Govt okays $152.12 million loan for agriculture

*Presidency yet to receive 2014 Budget

The Federal Executive Council (FEC) yesterday approved the acquisition of $152.12 million loan from the African Development Bank (ADB) towards boosting agricultural produces in the country.

The Minister of Agriculture, Akinwunmi Adesina and Minister of Information, Labaran Maku disclosed this to State House correspondents at the end of the FEC meeting Presided over by President Goodluck Jonathan.
Adesina said that the loan will be used to boost cultivation of rice, sorghum and cassava in 14 staple crop processing zones in the country.
Stressing that the loan will go a long way to add 20 million tons to Nigeria’s food production by 2015, he said that 120,000 jobs will be created from the initial staple crop processing zones.
He said: “Council today gave approval of a loan of 152.12 million dollars and a grant of 385,000 USD from the ADB to support the agricultural transformation agenda of Mr President.”“We are all excited about this because it is another affirmation by global institution of what we are doing and that we are on the right track as regard to agricultural development. Mr. President set a strategy that we will run agriculture as a business which is a major shift from how agriculture had been run before.”“We no longer just focus on production but we focus as well on storage, warehousing, processing, value addition, marketing, logistics and trade. In other words, agriculture today in Nigeria is a business which we have to make sure that we provide enabling environment in supporting it to grow and to generate wealth.”“The approval of the loan by the ADB is as a result of the progress Nigeria has made in the sector and we promised that we will add 20 million metric tons of food to our domestic food supply by 2015. As of now we have done 15 million metric tons.”Despite the progress in the sector, he said that there are a number of challenges in the rural areas including low level of agro processing and poor rural infrastructure.
These, he said, is making it difficult for farmers in the rural areas to evacuate their produce.“We also notice that a lot of companies that processed food in Nigeria are located in the urban areas like Lagos and they import all raw materials, process it and send it back inward. We are changing all of that by adding value to every single thing we produce in the country and add value where it is produced.”
He said: “When we do that, not only do we reduce cost of transport, we reduce storage loses, transport loses, we create jobs and revive our rural areas. The staple crops processing zones to be supported by the loan is a very innovative model.”“As a government we are determined to do import substitution by making sure that all what we are producing, rice, cassava, maize, soya beans and others are processed in the zones of high production.”“The staple Crop processing zone is an area of high production to which we are putting in the enabling environment to attract private sector food processing companies to come in to and process and add value to our commodities. It is a big game changer for agriculture and the ADB and the World Bank are so excited about it that they have asked other African countries to copy Nigeria.” Adesina said“Infrastructure is very important for the private sector, they need power, water, roads and rail for transportation and you cannot invest that everywhere because it is expensive to do. What we are doing that is unique is to identify the vast areas for staple crops processing zones to which we will immediately upgrade the basic infrastructure to reduce the cost of doing business by the food processing companies that will come to Nigeria.”Continuing, he said: “We have developed 14 staple crops processing zones master plan across the country which will cover a whole range of commodities like rice, cassa va, cotton, sorghum, aquaculture, livestocks and other production.”“Out of the 14 staple crops processing zones master plan six have been fully completed and now at the execution stage. The staple crops processing zones is a product of joint consultation and partnership between the Ministry of Agriculture and other MDAs.”

“The loan will be used to develop rice sorghum and cassava in commercial production and it will be used to support private sector processing and value addition. For the commodities, the Zones to be focussed on are as follows: Adani-Omo in Ebonyi and Enugu State which is for rice, and cassava; Bida and Badegi for rice, Kano and Jigawa for rice, tomato and sorghum; Kebbi, Sokoto for rice and Sorghum.”

He listed the seven states involved in the first phase to include Anambra, Enugu, Jigawa, Kano, Kebbi, Niger and Sokoto.

The facility, he said, will support infrastructure development, production facility, irrigation infrastructure, social infrastructure, rural roads, portable water, sanitation and health care.

“We want the rural areas to be places where the young ones can stay and be productive. The loan will also be used for agro-processing development, value addition, market information system for farmers in those areas. Expand access to financial service and crops insurance.”

“There are 27 LGAs that are covered under this very investments and it has been developed in close partnership with all the State governors and community involvement. There will be 120,000 jobs that will be created by the development of the staple crops which will include, 36,000 women. 200,000 youths are going to participate in the initiative.”

“It will allow us to add 20 million metric tons of production of rice, cassava and sorghum into domestic food supply.”

“There will be 17 water control structure to be rehabilitated, 1300 irrigation canals will be rehabilitated, 1300 kilometre of all weather roads will be rehabilitated, there will be 1007 tube wells to be constructed and in total 68,000 hectares of rice cassava and sorghum will be put under commercial production.” He added“The access to insurance by farmers in the seven states will increase from 9 per cent to 80 per cent while the number of farmers organisations obtaining loans from banks and other micro finance institutions will rise from 22 per cent to 80 per cent. The stable crops processing zones are being developed in conjunction with UNIDO and other development partners.” He stated
Maku said that the loan will eventually boost the Gross Domestic Product (GDP) of Nigeria.
Even as he maintained that the issue of 2014 Budget was not discussed during the FEC meeting, he said that the National Assembly is yet to transmit the passed budget to the President.