CBN links positive inflationary rate to agric transformation agenda

For the first time since 2008, the inflationary rate in Nigeria has come down to 7.8 percent from 8 percent, according to reports from the National Bureau of Statistics (NBS).

Sanusi Lamido Sanusi, governor, Central Bank of Nigeria (CBN), attributed this to a modern agricultural financial strategy adopted by the Federal Ministry of Agriculture in collaboration with the CBN and supported by Nigerian banks.

The CBN governor was represented by the deputy governor on Fiscal System Stability, in an interactive session with Akinwunmi Adesina, minister of agriculture, and some selected chief executives of banks at the weekend in Abuja. They noted that bank lending to the agricultural sector had been put at a single-digit interest rate that would co-opt seed companies and fertiliser companies to support the agricultural transformation.

Adesina, while confirming the CBN governor’s assertion, noted that the Federal Government’s Growth Enhancement Scheme (GES) kick-started the revolution of agriculture as a business, saying

“we lost N776 billion since 1980 from political farmers who did not deliver fertilisers to farmers. While government kept subsidising to their pockets, the real farmers kept suffering in abject poverty.”

He said that “when we came on board, we introduced the GES which allowed us refine access to the real farmers and through that we cleaned up the system, and the real farmers got into business and banks were willing to lend.”

The minister also hinted that the GES of the Federal Government had received the support of some banks across the country, as total bank lending to the agricultural sector was now N20 billion, saying “so far a total 4.5 million farmers have been registered through the GES scheme and having impact on about 20 million people directly and indirectly along the value chain.”

Adesina also informed that September forecast report of Financial Derivatives had earlier predicted the drop in the inflationary rate, adding that farm harvest according to the report played a major role in the drop.

Reacting on the impact of the agricultural transformation, the minister said annual food importation in the country had been reduced to N857 billion as against N1.3 trillion that was spent on food importation a few years back.

By: Harrison Edeh