Addressing participants at the maiden First Bank Agric Expo, held in Lagos on Tuesday, Ogbe said that increased funding of the sector would empower farmers who seek funds to expand their businesses for increased yield.
“This economy can grow in other sections not only oil and gas. You can demystify the nursery of interest rate. The farmers have no collateral. We can find a way of making sure that your money is not lost through engaging in cooperatives. Farmers would not default on loans, and can restructure the loans.
“Banks are afraid to invest on the sector due to fear of not recovering their money. Nigeria has less than 30,000 tractors most often are not functional. India has one million tractors. Lack of credit, research institutions are issues we must seriously tackle.”
The Minister for Agriculture and Rural Development, Chief Audu Ogbeh, urged the Organised Private Sector (OPS), especially Nigerian banks, to increase funding in agriculture and make the country food self-sufficient.
He identified lack of capital and research as a major hindrance to job creation and development in the sector, also stressed the need for banks to support the growth of the sector by lending on a single digit rate to farmers.
Access to funding will boost agricultural production, as farmers will be able to invest in higher –yield seedling, better farming tools including irrigation as well as afford extension services like research and development.
This will in turn, impact on harvest though the availability of foods for the masses, higher revenues for farmers and greater contribution to the Gross Domestic Product (GDP).
The Minister stressed the importance of research in agriculture development, especially in seed improvement for farming, noting that government has resolved to ensure the availability of fertilizer to farmers.
He also disclosed that government plans to increase availability of fertilizer across the nation to encourage farmers, boost agricultural production and make food production easier.
“We need to stabilise our food production, we need to sort it as fast as possible. The banks should help us out. We will make sure your monies are repaid when you loan by making sure the producers do not loose their products.”
The Minister noted that with an anticipated increase in Nigeria’s population, which he put at 500 million by the Year 2050, there was need for governments to engage the teeming youths in agriculture by establishing a skill acquisition centres across the country.
He added that the neglect of the agriculture sector has given rise to hunger, poverty and a huge population of youths struggling to find job in Nigeria.
The Managing Director of Afrez Commodities, Ayodeji Balogun, said Nigeria must provide value chain financing in agriculture to enable liquidity and allocation of funds to spread down the entire chain.
“Our extension services is always a big problem. We need to provide the knowledge for farmers. In Kenya, they use technology and mobile phones to accelerate delivery of extension services. We cannot leave it for government alone,” he added.