Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) Plc has said that investment in the agricultural sector of Nigeria’s economy is unsafe.
NIRSAL says what is needed to cushion the risk is a fixed, de-risked and integrated agricultural value chain with efficient and controlled route-to-market for commodities.
NIRSAL’s Managing Director/ Chief Executive Officer, Aliyu Abdulhameed, brought this to the notice of the authorities during a meeting with the Federal Ministry of Trade and Investment in Abuja.
According to Abdulhameed, the agriculture sector still requires massive financing, equipment, technology, and intellectual capital to enhance its growth following the food security objective of the nation.
This development, he added, would address the menace of about 50 percent post-harvest losses on some agricultural commodities leading to significant loss of economic value.
The NIRSAL boss notes that though the country was blessed with abundant opportunities in land, labour, water and markets, then, it remains, “food insecure” with about N1.5 trillion average annual food import bill and 94.6 million poor and malnourished people.
He further pointed that agriculture currently accounts for 25 percent of the country’s GDP which was even as high as 42 percent before 2014.
“Inefficiencies inherent across agricultural commodity value chains make the sector highly unattractive for investment and the sector’s potentials highly under-maximised in Nigeria,” he said.
To tackle the inefficiencies in the sector, Abdulhameed said that the planned implementation of the Secured Agricultural Commodity Transport and Storage Corridor (SATS-C), an initiative of NIRSAL will help to effectively combat post-harvest losses, create jobs and boost the contribution of the agriculture sector to Gross Domestic Product (GDP).
SATS-C is a new initiative of NIRSAL aimed to address the supply-side and trade-related constraints of agricultural commodities in Nigeria by facilitating the movement of goods safely from the primary source to the domestic consumer, Industries, and Export market.
According to him, when fully operational, the SATS-C policy could directly lead to a five percent increase in the agriculture sector’s contribution to GDP by halving annual post-harvest losses of $12 billion.
The initiative, he further explained will also complement and perfect one of NIRSAL’s business models/concepts known as PH-P3 (Primary Production & Harvest, Primary Processing, Primary Transportation and Primary Storage)
PH-P3 is a business concept that ensures efficient production in the farms and optimum capture of value at harvest by enabling prompt evacuation of produce from farm-gates, and the subsequent haulage of commodities across the country through designated corridors.
The scheme was first introduced in December 2018, the policy essentially aims to fix key constraints confronting the transportation of agricultural produce and products across the country, working with both private and public sector stakeholders.
Abdulhameed, therefore, called on all enabler institutions driving necessary dialogues and championing advocacy to support the Federal Ministry of Industry, Trade and Investment, FMITI in the development and implementation of the SATS-C policy in Nigeria.