The Central Bank of Nigeria is to provide about N750bn for the recapitalisation of the Bank of Agriculture before the end of next year, the Federal Government has said.
According to the government, the restructuring and recapitalisation of the BoA will enable the bank to attract up to N1tn to effectively provide loans at affordable interest rates to farmers.
The Minister of State for Agriculture and Rural Development, Senator Heineken Lokpobiri, disclosed this at the Farmers’ Field Day organised by Dizengoff Nigeria Limited in collaboration with Phinada Integrated Farms in Abuja.
He said, “The Central Bank of Nigeria is collaborating with the Ministry of Agriculture. This is because one of the biggest challenge of agriculture in Nigeria today is access to affordable loans. But in many other parts of the world, agriculture is the most attractive sector for banks to lend money to. So what do we do?
“As a ministry and the Federal Government, we are planning to recapitalise the Bank of Agriculture. So, we are to restructure the BoA and the CBN is committed to providing about N750bn. The BoA as an institution itself is going to attract hundreds of billions of naira. And we thinking that before the end of next year, we should be able to attract at least N1tn available credit to be lent to anybody who wants to do farming business.”
The minister added, “Right now, the Federal Government is subsidising farmers, but the subsidy is not what the farmers want. We have seen this under the Anchor Borrowers Scheme of the CBN in Kebbi. In that scheme there was no subsidy.
“What the CBN, through the BoA, did was to give each farmer between N110,000 and N130,000 to cultivate one hectare of rice farm, and some of them got 10 tonnes per hectare. And if rice per tonne is between N60,000 and N80,000, then whoever adequately cultivates two hectares is already a millionaire.”
Lokpobiri further stated that the Federal Government decided to make tractors import duty-free in a bid to move Nigeria towards mechanised and commercial agriculture.