Anchor Borrowers’ Programme as an Effective Tool for Food Sufficiency

With the Anchor Borrowers’ Programme (ABP), an initiative of the Central Bank of Nigeria (CBN), the right chord appears to have been struck towards food sufficiency, writes Ndubuisi Francis

Prior to the launch of the Anchor Borrowers’ Programme by President Muhammadu in Kebbi State on November 17, 2015, Nigeria was beset by a combination of a precipitous falling oil prices and skyrocketing food import bills.

Rice imports alone gulped, a about $2 billion annually-- a development the Governor of the CBN, Mr. Godwin Emefiele described as unsustainable, considering the nation’s depleted foreign reserves.

Prior to the advent of the scheme, the rice import cabal in the country fed fat from dumping the staple food on hapless Nigerians at exorbitant prices; a development the National Agency for Food and Drugs Administration and Control (NAFDAC) and the Nigeria Customs Service (NCS) perennially frowned on because of the contentious nutritional value.

Importers frustrated every effort of government to grow rice locally such that when the federal government banned its importation through the land borders and embarked on tariff hike when imported through the seaports, they still devised strategies to smuggle the item into the country.

Again, when the CBN included rice as one of the 41 items on the foreign exchange (Forex) prohibition list, they literally engaged the apex bank in fisticuffs.

However, despite the sustained campaign of calumny against the ABP, the successes recorded so far have vindicated Emefiele’s disposition that given the right incentives, Nigerian farmers will meet local food demand.

Since the ABP took off in 2015, about 17 states have embraced it with total disbursement from CBN as at December 2016 stands at N26, 998,143,566.

Emefiele had said that it was the beginning of rice revolution in the country. Thousands of jobs have also been created along the rice value chain.

Currently, rice production in Nigeria, according to available statistics, stands at 4.5 metric tonnes and out of this figure, 2.5 metric tonnes is from the CBN ABP.

Aside that, Nigerians insatiable appetite for foreign rice has waned considerably in the last one year as consumers have come to appreciate the freshness of local rice unlike the foreign brands that have been stored for upward of half a decade under questionable conditions, before being dumped in the country. So, it was the need to reduce the pressure on the nation’s scarce foreign exchange (Forex) for the importation of foods like rice, milk, wheat, fish, etc; create jobs, guarantee food sufficiency and open export windows that Emefiele insisted the country must immediately start local production of these items using the ABP as the fulcrum.

Hence, the scheme became one of the vehicles the CBN used to move from concen- trating only on price, monetary and financial system stability to act as financial catalyst in specific sectors of the economy, particularly agriculture.

N40 billion, out of the N220 billion Micro, Small and Medium Enterprises Development Fund (MSMEDF) has been earmarked as loan for farmers at a single-digit interest rate of 9 per cent. The CBN also released the simplified guidelines on how any business-minded stakeholder could access the fund all in its efforts to return Nigeria to the early 1960s to mid-1980s era, when visionary leaders like Chief Michael Okpara in Eastern Nigeria, Obafemi Awolowo of the Western region and Tafawa Balewa of the Northern flank, made agriculture the main stay of the economy. Okpara revolutionised oil palm; Awolowo built the economy of the western region with cocoa, while Balewa spearheaded the groundnut pyramids which the north was known for.

The apex bank targets that by 2021, the ABP will have created at least 1,000,000 direct and indirect jobs in the processing segment of the identified value chains.

Unfortunately, it was the discovery of crude oil in commercial quantity in the 50s and 60s that panned successive government’s attention away from agriculture, thus vandalizing the nation’s economy and leaving it in prostrate state till date.

Emefiele said the ABP, which is being implemented under the auspices of Presidential Task Force on Rice, Wheat, Cassava and Tomato with the involvement of the Federal Ministry of Agriculture and Rural Development, aims at creating economic linkages between over 600,000 smallholder farmers and reputable large-scale processors with a view to increasing agricultural output and significantly improving capacity utilization of integrated mills. This, he noted, would close the gap between the levels of local rice production and domestic consumption, as well as complement the Growth Enhancement Support (GES) Scheme of the Federal Ministry of Agriculture and Rural Development by graduating GESfarmers from subsistence farming to commercial production.

Many individuals and corporate bodies like the Manufacturers Association of Nigeria (MAN), the National Association of Small Scale Industrialists (NASSI) have lauded the ABP, which encompasses the commercial production of rice, wheat, tomatoes, cassava and other crops. They describe it as a timely and effective scheme that should be sustained and replicated in other sectors. They urged various Ministries to work with the CBN to see areas of immediate collaboration in the urgent task of diversifying the nation’s economy.

They said the CBN should not succumb to the pressure from some quarters to exclude rice and other foods from the 41 items on the Forex ban list. MAN President, Dr. Frank Jacobs, while appraising the programme described it as laudable and encouraged other states that are yet to key in to come on board.

“The scheme is good. Any programme that will encourage local production either in agriculture or other area is a welcome development. We applaud the ABP. It has helped create jobs for many farmers and other investors. It’s the right way to go and the CBN should be encouraged”, he said.