UNIFEMGA Identifies Problems Confronting Nigeria’s Agricultural Sector, Proffers Solutions
By Abimbola Abdullahi
The Obafemi Awolowo University Muslim Graduates Association (UNIFEMGA) has identified limited finance, high cost of power generation, limited storage facilities, inadequate market information as some of the problems confronting the agricultural sector in Nigeria.
Rising from a one-day third agricultural conference organised by the Ogun state Chapter of the association in Abeokuta, it was resolved that to get it right as a country, all the factors listed must be adhered to.
The conference, with the theme: Agricultural Entrepreneurship and Development: Access to finance and funding opportunities”, noted with concern that corruption has been the main factor affecting the Nigerian economy and until it is vigorously tackled, the country will not make any progress.
UNIFEMGA, in a communique, added that interventions and aids which could have helped the sector only come as crash program and is not consistent.
According to the foremost Muslim Alumni, natural occurrences such as flood which could lead to famine must also be taken into consideration for Nigeria to move forward in the agricultural sector.
The communique also identified national insecurity and mistrust, banditry, kidnapping for ransom, the Boko Haram insurgence as some of the factors responsible for the reluctance of financial institutions to provide credit for agriculture venture as it poses a great financial risk and therefore attracts high interest rate that is mostly unaffordable to agriculture entrepreneurs.
“Corruption is the bane of our economy and until we drive it out from all the sectors of the economy, we are going nowhere as a nation. The challenges confronting Nigeria as a nation among others are lack of modernisation/mechanisation, market volatility, limited finance, tax and duties laced with inconsistencies by government, high cost of power generation.
“Project interventions and aids come as crash programme and is not consistent. Natural phenomena are very difficult to cope with and manage because of the negativities such as flood which wash away farm settlements and which may result in famine. So also is national insecurity and mistrust, banditry, kidnapping, Boko Haram insurgence, etc.
“The presence of these challenges are responsible for the reluctance of financial institutions to provide credit for agriculture venture as it poses a great financial risk and therefore attracts high interest rate that is mostly unaffordable to agriculture entrepreneurs. With less than 5% of banks’ credit granted to the sector, finance from traditional banks remains a major challenge to agriculture development in Nigeria.
“In order to bridge the gap within the agriculture credit market, financial institutions like Lotus Bank has a critical role to play by developing areas around the value chain through product financing, financing of farm inputs, financial advisory and financial literacy. Financial institutions must understand that whatever financing option to adopt must be mutually beneficial,” the Communique added.
The conference advised entrepreneurs to take advantage of Lotus Bank, where there are financing for the purchase of inputs for crop production such as seedlings/seeds, fertilisers, insecticides, manual sprayers, for the acquisition of farm machinery, of working capital needs through forward purchase of agriculture produce, for infrastructure development such as farm house and warehouse as well as equity partnership on agriculture venture.
While calling on those who want to embrace agriculture as business to have sound knowledge of the sector through mentorship and research, he urged government and policy makers to show sincerity of purpose in addressing the multiple challenges facing the Nigerian economy so that people are encouraged to put in their best.
“Government policy must not be anti- people and innovation as we have in most situation in Nigeria where upcoming local business are brutally killed by multiple unexplained heavy financial demands from government agencies.”
