The Minister of Agriculture and Rural Development, Dr Akinwumi Adesina, has called for the allocation of 10 per cent of the nation’s annual budget to agriculture.
Adesina made the suggestion while contributing to a discussion in Abuja yesterday at the 19th Nigeria Economic Summit on ways to sustain the nation’s agenda on agriculture.
He said that financing the growth and development of the agriculture sector should be significantly expanded for realistic growth.
“At the moment, we are not spending enough on agriculture. As we go forward, we have to restructure the modes of financing of the sector.
“We need to make at least 10 per cent of our budget to go to agriculture, if we want to sustain this particular agenda.
“The issue of getting financing from the private sector is key. Nobody is going to do agriculture and borrow money at 25 per cent interest rate and also make profit.
“So we need to find new institutions, new arrangements and new platforms that will allow us to get affordable financing as well as long-term financing.
“So we really cannot get far until we tackle this particular issue.’’
Adesina also said that adequate funding of research and development institutes that were geared toward innovative agriculture discoveries was important.
“I think it is very crucial for us to invest heavily in research and development because no nation in the world has been able to achieve this without spending money on innovative technologies.
“Talk about China, Brazil, Pakistan and India, all of them invested in innovative technologies.
“Right now we are spending less than one per cent on research and development and it is not enough. To be the global power we want to be, we must spend more on research.’’
He said that another factor stunting the growth of agriculture in the country was the issue of agricultural extension, diverse means of transportation of farm produce, among others.
The minister said that the way forward was for young and fresh minds to come into the business of agriculture.
Adesina said that this was the reason why the recently launched Nurturing the Successor Generation of Nigerian Farmers and Agriculture Enterprises by President Jonathan, was a welcome development.
The Chairman of Heir Holdings, Mr Tony Elumelu, said that there should be continuity in the transformation of the agriculture agenda, to achieve sustainability in the sector.
He said that the ultimate goal of the agriculture agenda would be achieved when policy reforms and incentives were put in place.
“We also need to think of how to make agriculture more lucrative. It employs a lot of people but in actual wealth, it doesn’t make a lot of them rich.
“So if we succeed in making it lucrative and people begin to make money, naturally others would want to join in,’’ he said.
The Chief Executive Officer, Stanbic IBTC Holdings, Mrs Sola Borha, said that for affordable lending for agriculture purposes, the sector needed to be attractive, to enable banks feel safe to advance loans.
“ NIRSAL funds provided by the Central Bank is a step in the right direction since it is aimed at sharing risk, this will result to bankers feeling more comfortable in advancing agricultural loans.
“ This would help to bring the lending rates to the agricultural sector down.
“A commodity exchange, plus warehousing system, is absolutely key in providing the appropriate structure to agric business,’’ she said.
The Minister of the National Planning Commission, Dr Shamsudeen Usman, said that an alternate funding of the agriculture system apart from the traditional funding by banks was necessary.
“ At the federal level more economic policies like the NIRSAL funds should be fashioned to cushion risks in agriculture funding.
“Diversifying the transport sector is also important, which is why a step in that direction is already being taken, through resurrecting the train routes of Kano to Lagos and Port Harcourt to Borno,’’ he said.
The Managing Director, PZ Industries Plc, Mr Christos Giannopolus, also harped on the importance of having the right transportation system in place to aid movement of goods and services.
“ However, time is costly, if it takes over a month to move goods from Port Harcourt to the north, that becomes a challenge.’’
Giannopolus also urged the government to create more road corridors in the country.
He noted that the cost of using a particular means of transport half way through a journey and having to change to another was not cost effective and that it affected prices in the long run.