MONDAYBUSINESS MONEY MARKET Banks urged to boost agric sector funding

Banks may have to intervene to balance the sharp contrast between the government’s pronouncements on diversifying the economy into agriculture and its ‘discouraging’ allocation to the agricultural sector in the 2018 budget.

Professor Mohammed Madawaki of the University of Maiduguri said in Maiduguri recently that banks should take the initiative of adequately financing the agricultural sector because the allocation of only 2% of the 2018 federal budget I’d grossly insufficient to enable the sector play its allotted role well in economic diversification.

Professor Madawaki was delivering a keynote paper title: ‘The Role of Banks in the Diversification of the Nigerian Economy’ at the 2017 Annual Bankers Dinner and Award Night in Maiduguri.

“Even though the government itself has been emphasising the need to diversify the economy into agriculture, its actions as indicated in the 2018 budget is not very encouraging as its budgetary allocation for agriculture and rural development for the 2018 fiscal year is only N188.98bn, representing only about 2%,” he lamented.

“Although this is an improvement over the N103.78bn in the 2017 fiscal year, it still does not reflect the level of importance of agriculture in national economic development, especially when viewed as the biggest positive contributor to economic grown,” Prof. Madawaki maintained, noting, “For instance, in all the quarters of 2016 it was recorded as the top performing sector with an average growth of about 4.53%.”

He observed: “The role of the banking system in this regard is to adequately finance the agricultural sector by mobilising loanable funds from customers and channeling same to both Small Holder Farmers (SHFs) as well as established agro-businesses in order to boost agricultural production for local consumption, processing and export.”

In his opening remarks, the Maiduguri Branch Controller of the Central Bank of Nigeria (CBN), Alhsji Isyaku Ibrahim, had saluted bankers in Maiduguri for their courage, resilience and sacrifice inspite of the Boko Haram insurgency.

Banks awarded at the first Dinner/Award Night in the last eight years included First City Monument Bank (FCMB), United Bank for Africa (UBA), First Bank, and Sterling Bank.