Edo: Building value-chain models, wooing investments through agriculture
With 1.1 million hectares of cultivable land and a teeming young population, Edo State is undoubtedly one of the few states in the country with huge potentials for agriculture. Also, the state has a landmass of about 19,187 Km, 70 percent of which is cultivatable.
There is thus no doubt why the governor Godwin Obaseki-led administration has taken keen interest in harnessing the vast agro potentials of the state. Data show that the agriculture accounts for about 40 percent of the state’s revenue.
Contending with the vagaries of unstable oil prices in the global market as with other states, the Obaseki government is latching onto agriculture to diversify the local economy, attain food sufficiency and drive its job creation plans.
The grand plan includes calculated and far-reaching reforms that will attract and protect investments to boost production of oil palm, cassava, maize, yam, rubber, cocoa, rice, vegetables, aquaculture and livestock. A striking feature of Obaseki’s plan for agriculture is the partnership he is facilitating among private investors, government agencies and other stakeholders in the agricultural value chain.
Felix Nwabuko, chairman, PRESCO Plc., whose company is a major investor in agriculture in Edo State, believes that Edo provides a conducive investment for agriculture. He notes that in Nigeria, agriculture is still bedeviled by myriad of challenges, such as lack of access to finance, land acquisition, infrastructure, community clashes amongst others.
Speaking during the recent Alaghodaro Investment Summit, he said, “All of these have serious impact on agribusiness. Some of the issues that exist include climatic variations, which Edo State is thankfully not susceptible to.”
These stakeholders include but not limited to the Tolaram Group and DUFIL Plc as off-takers for produce; the Agricultural Development Project as trainers and extension workers; the Edo Fertilizer Plant and Chemical Company Limited operated on Public-Private Partnership by WACOT Limited for supply of inputs such as fertilizer; Benin-Owena River Basin Authority for irrigation; farmers’ groups, and the Central Bank of Nigeria (CBN) for guarantees to de-risk investment.
The arrangement is primed to run on a value-chain model that will ensure every stakeholder gets needed support to invest in the state and earn competitive returns on their investment.
Aside assuring a financially robust state, the agricultural tsunami sweeping across the state will provide employment to the ever-booming youthful Edo population. It would also drive up the state’s self-sufficiency in food production, even as the state already has robust base for producing cash crops, especially oil palm.
And with the Libyan returnees in the state, the government is channeling their energy towards agriculture. The state governor has provided them with 100 hectares of land for agriculture and a N150 million seed fund to fast track their mainstreaming into the agricultural value chain in the state.
Preparing the ground and de-risking investment
And putting his words to action, Governor Godwin Obaseki on 10th August, inaugurated a 15-man Governor’s Council on Agriculture.
The decision to draw up the team is to ensure the state produces top-notch human resources to power the agricultural revolution of the present administration.
The state has shown commitment to this by leveraging a number of initiatives that changes the way agriculture is perceived by investors, youths and women, who, according to the World Bank, are a critical stakeholder in agriculture in Nigeria, as they contribute to the bulk of the farming workforce.
To ensure investments flow into agriculture in the state is secured, the Obaseki recently earmarked N500 million Commercial Agricultural Credit Scheme (CACS) to de-risk investments. The state is in partnership with the CBN on the management of the fund. This will ensure that those investing in Edo access finance easily as the structure is already in place to support their investments.
Fertiliser for higher yields and the wonder at Sobe
As one of his initial steps to ensure that farmers in the state get the needed inputs for farming, Obaseki revamped the moribund Edo Fertilizer Plant and Chemical Company Limited in Auchi and set up a private public partnership with WACOT Limited to manage the facility.
The move, aside the obvious benefit of providing fertilizers, speaks to the governor’s commitment to ensure that the right structures are in place to guarantee farmers of inputs.
Speaking at the commissioning of the plant, the governor said, “The aim of revitalizing this plant is to make the state self-sufficient in food production and enable farmers get fertilizer at affordable prices. We in Edo State are determined to make food available in the country.”
He noted that the facility will feed neighbouring states such as Kogi, Delta, Ondo and Anambra among others, with its products, as it was the only blending plant in the region.
The state government also has a Public Private Partnership (PPP) arrangement with Saro Agro Sciences Limited to run a 450-hectare maize farm to accelerate the mainstreaming of agriculture in the state’s economy. This is a part of a larger plan to cultivate 5000 hectares of farmland across the state, with youths leading the drive as agri-preneurs.
The governor said that his administration adopted the PPP business model so that the youths for whom the programme was created can leverage on the expertise of major players in the agricultural sector and grow into big players themselves.
Rasheed Sarumi of SARO Agro Services said his company was working to actualise the state government’s vision to create jobs and engage youths through agriculture, adding, “We are using market-led approach to agriculture in Edo State. The arrangement is that we would buy what the people produce and we are to provide them with inputs and training.
“Each of the youth outgrowers, will own a 5-hectare farm and employ 50 others. We intend to process maize into feeds in Edo State. Though we are starting with maize, we are moving to other crops.”
Key to job creation, economic diversification agenda
Governor Obaseki’s promise of creating 200, 000 jobs in the state will be largely hinged on optimal exploitation of the state’s huge agricultural resources.
“Today is the first step towards actualising the 200,000 jobs promised by my administration,” the governor said while inaugurating the 1,000 hectares of cleared field for maize production in Sobe Farm Settlement of Owan West Local Government of the state in April.
“If we invest in agriculture, we can do more than 200,000 jobs in Edo and Nigeria as a whole,” he said.
Access to arable land is one of the primary determinants of a thriving agricultural sector. The Obaseki administration is watering the ground already to ease access to lands across the state. In October, the Edo governor said his administration was targeting at least of 250,000 hectares of land for cultivation in the next two years.
“The importance of embracing agriculture as an administration via focusing on food security, large scale farming, and access to land, information and improved seedlings cannot be over emphasized. Agriculture is now scientific and mechanisation will help us compete in the agricultural market,” the governor said at the 13th Esan Economic Empowerment Workshop organised by the Association of Esan Professionals at Uromi, Esan North East Local Government Area of the state.
The Gelegele Seaport exportation takes new turn
Transportation is one key area that can sway the economy to the right direction if well-managed. That’s why the Edo State government is putting the right measures to build the Gegegle Seaport. According to the governor, the seaport will serve as a point where “goods can be efficiently moved to various states and distributed across the country”.
The state is undertaking the right legal framework that will see the dream become reality. Obaseki had also set up and received a report from a committee drafted to design modalities for the project expected to stimulate exportation of agricultural produce.
Plucking the low-hanging fruits first
Edo State is blessed with agriculture research institutes and one of such is the Nigeria Institute for Oil Palm Research (NIFOR) close to Benin City.
Years back, the state was renowned for its oil production and the Obaseki government has taken steps since inauguration to rejig the sub-sector and make palm oil the new crude in the state. And he is building strategic partnership with relevant stakeholders to tap into that.
In September, Governor Obaseki travelled to far-away Indonesia where he met with officials of the Indonesian Oil Palm Research Institute in Medan.
The governor’s visit was to deepen strategic agricultural ties with the Asian nation. Indonesia which was said to have gotten palm seedlings from NIFOR is the world’s largest exporter of palm oil with the agricultural sector the country’s most valuable export sector.
In 2014, Indonesia’s palm oil production was 33.5 million tonnes. The product also makes up 11 per cent of export earnings of $5.7billion in the country.
These, among others, were what prompted Obaseki to visit the nation and as he rightly captured then, “the present pace of research in the agricultural sector, oil palm can replace crude oil as a major source of food, industrial materials and energy.”
But Indonesia was just one of the three countries that the governor visited. In fact, the first fruits of one of the visits – to Singapore – resulted in a $50 million investment windfall for the state.
The money which will be plucked into the state’s oil palm and cassava production in Edo, an initiative that is expected to create about 50,000 jobs, is in partnership with Tolaram Group
Aside the financial gains, the governor also liaised with a group of industrialists. There, he sold agribusiness investment opportunities in the state.
OBINNA EMELIKE