ERGP: NIRSAL Commends FG for Making Agriculture Top Priority Sector

To expand lending to 3.8m farmers by 2026

The Managing Director of the Nigerian Incentive Based Risk Sharing System for Agricultural Lending (NIRSAL), Mr. Aliyu Abbati Abdulhameed has commended the federal government for making agriculture one of the six priority sectors of focus in the Economic Recovery Growth Plan (ERGP).

According to Abdulhameed, the decision was a right one because agriculture has unrivalled capacity in job creation, poverty reduction and inclusive economic growth.

The NIRSAL MD/CEO made the remark in a paper titled “Powering Nigerian Agriculture Through Innovative Financing: The NIRSAL Edge” at the BusinessDay Agribusiness & Food Security Summit 2017.

The NIRSAL MD asserted that the Buhari administration’s strong emphasis on agriculture is very evident in the series of practical programmes and initiatives of the government, citing government’s support for agencies such as NIRSAL as underscoring this clear commitment.

In his words: “It is heartwarming indeed that the Federal Government is going beyond the much talked about potentials of agriculture to actually demonstrating, through practical policies and initiatives that it is committed to transforming agriculture for the good and progress of the country.”

Expressing NIRSAL’s readiness to play its part in the realisation of the economic recovery plans, Abdulhameed listed key NIRSAL plans for 2017 as: Leveraging its balance sheet to facilitate N60billion in fresh commercial bank lending; executing the $300 million African Development Bank’s Youth Enable Program and operationalising the $500m Mechanisation Partnership with the Brazilian Government amongst others.

NIRSAL’s broad objective is to increase lending to 3.8 million farmers by 2026(?) through cooperatives and value chains. It also plans to reduce the break-even interest rate to agribusiness borrowers from 22% to between 7.5% and 10.5%.

Abdulhameed stated that NIRSAL’s readiness is a tribute to the farsighted vision of President Muhammadu Buhari, the leadership of the Governor of the Central Bank, Mr. Godwin Emefiele and the active support of the Minister of Agriculture and Rural Development, Chief Audu Ogbeh.

He stated that the current economic context and the changing global economy demand that the country moves with greater urgency to fix Nigerian agriculture. According to Mr. Abdulhameed, NIRSAL is a key part of the government’s multi-pronged strategy to move agriculture beyond potential to significant progress.

Specifically, he stated that NIRSAL’s role is to help solve the longstanding problem of inadequate financing of the agricultural sector by leveraging its $500 million fund to incentivise lending to the sector.

He pointed out that NIRSAL does this by ‘de-risking’ the agricultural financing value chain, building long-term capabilities and institutionalizing agricultural lending through risk sharing with banks, technical capacity building as well as the provision of incentives to encourage bank lending.