The Nigerian Incentive-Based Risk Sharing System for Agricultural Lending, (NIRSAL PLC) has announced the disbursement of over N148 billion worth of finance and investments in the agricultural sector. The strategy seeks to boost the steady flow of funds to the country’s agriculture ecosystem as the COVID-19 (coronavirus) pandemic disrupted the flow of activities in the sector in 2020.
In a statement, Aliyu Abdulhameed, Managing Director of NIRSAL noted that NIRSAL consistently worked to facilitate funding last year as people needed food for survival. According to Abdulhameed, “the body facilitated over N148 billion in finance and investments for agriculture and agribusiness; aggregated over 3,000 Agro geo-cooperatives with 500,000 farmers on nearly 800,000 hectares of land.”
He further said that the NIRSAL, which is a wholly-owned corporation of the Central Bank of Nigeria) facilitated over N30 billion into the sector between January 2020 to date.
In a recent report by the National Bureau of Statistics (NBS), the significant role the Agriculture sector played in facilitating the sudden exit of Nigeria’s economy from recession in the 4th quarter of 2020 alongside the telecommunications sector was highlighted. The sector is said to have contributed 3.42 percent of the 0.11 percent growth in Gross Domestic Product by the end of 2020. This reveals the importance of the country’s one-time leading foreign earner.
With the January 15, 1956 discovery of crude oil in commercial volume at the Oloibiri Oilfield in current Bayelsa State by Shell Darcy, Nigeria shifted its focus from the Agric industry. The country abandoned that sector in the hands of smallholder farmers and a few strong players and relied heavily on the oil sector.
This reduced the capacity of the industry to generate much foreign revenue or evolve into the use of sophisticated technologies like its counterparts in the global market. It further resulted in the inability of the sector to provide enough food for the country as the government began to spend billions of naira for the importation of rice and other agro products.
Nevertheless, the latest funding would create a significant impact on the growth of Nigeria’s Agricultural sector as farmers and agric businesses would secure flexible loans to continue with production activities. The fund would strengthen the country’s labour force as it would create a rise in the demand for more farm labourers and marketers of Agric products. Furthermore, the Nigerian economy gets to benefit more from this disbursement as it would ensure food security and generate foreign earnings.