#fafin

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AfDB's $9 million equity investment for Agricultural Finance in Nigeria.

AfDB’s $9 million equity investment for Agricultural Finance in Nigeria.

The Fund is jointly sponsored by the German KfW Development Bank and the Government of Nigeria, through the Federal Ministry of Agriculture and Rural Development (FMARD). (more…)

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visit at:    www.fafinstore.com

*a part of a conceptual project made in Bezalel

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F A F I N  Genderless Clothing

[voiceofarewa]

New Post has been published on Voice of Arewa

New Post has been published on http://www.voiceofarewa.com/2014/10/03/agriculture-gains-prominence-as-economy-shifts-from-oil-dominance/

Agriculture Gains Prominence as Economy Shifts From Oil Dominance

As Nigeria celebrates 54 years of independence, stakeholders are optimistic that with the Agricultural Transformation Agenda (ATA) on course, the sector is facing its greatest success since the discovery of oil. Ruth Tene Natsa writes on the many successes and challenges of the sector.

Prior to the 1960s, the nation’s agriculture sector was not only vibrant but was a major source of generating income and subsequently a major contributor to the gross domestic product (GDP).

Agriculture was a platform for poverty alleviation, job creation and provided most of the foreign exchange through the farming of cocoa, groundnuts, cotton and palm produce among several others which was used to develop and create various infrastructures in the nation.

The discovery of oil in the 1960s led to a total neglect of the sector, while investors rushed to partake of the national cake, leaving agriculture to the very few who practised at a subsistence level.

The neglect made agriculture to become poorly funded and it was practised at a subsistence level. Farmers suffered severe post- harvest loss, it became unattractive to youths and generally non profitable for investors and funding managers. 54 years later and with the knowledge that oil cannot last beyond three decades, President Jonathan’s government, through the minister of agriculture and rural development, Dr Akinwumi Adesina, set up the ATA with the aim of making agriculture more attractive to not just the ageing farmers but youths through the setting up of the Nagropreneur in 2012.

As of date, the government, through the ATA, had successfully registered over 10 million farmers in its data base to benefit from the growth enhancement scheme (GES) Adesina said.

“We developed Nigeria’s first ever database of farmers so we can identify farmers and manage farmers identity. Over 14.5 million farmers have been registered in the past three years. Nigeria is the first country in Africa to do this and the farmers are being migrated into the national e-identity card system which allows the use of their biometric information to effectively target them and open them up for financial inclusion.”

The federal government has also alluded to ending four decades of fertiliser sector corruption within 90 days and with it the era of government buying and distributing seeds and fertilisers. It was replaced with a private sector-driven system with the role of government shifting to providing targeted farm support directly to farmers for seeds and fertilisers via electronic coupons on mobile phones or “e-wallets.” It recorded that between 2012 and 2014, a total of 14 million farmers received their subsidised farm inputs using electronic vouchers on their mobile phones to directly pay private sector input retailers.

To further enable the private sector seed companies to develop, the federal government said it had ended government monopoly over foundation seeds and opened it all up to the private sector, adding that the number of seed companies in Nigeria rose from 5 to 80 within three years, while multinational seed companies have begun to invest in Nigeria, including Syngenta and Dupont, two of the largest seed companies in the world, as demand for seed has far outstripped supply. Private sector investments in fertiliser manufacturing have also expanded with $5 billion of private sector investments in fertiliser manufacturing within the past three years.

In the recent past, the sector also witnessed a revival as the share of total bank lending expanded from about two per cent in 2011 to five per cent by 2013. Bank lending to seed companies and agro-input dealers expanded from $10 million in 2012 to $53 million in 2013; while bank lending to fertiliser companies expanded from $100 million in 2012 to $500 million by 2014.

The Ministry of Agriculture and Rural Development also designed and launched a $100 million private equity fund, the Fund for Agricultural Financing in Nigeria (FAFIN). This was done jointly with the German Government and the Nigerian Sovereign Investment Authority with an initial capitalisation of $33 million. Managed by private sector fund managers, FAFIN is providing equity and quasi-equity long term financing for Nigerian agribusinesses across the value chain.

SOURCE: LEADERSHIP (5)