International agencies grant Nigeria agric loans Aug 23, 2009 22:14:05 GMT 1
Post by Ismail AbdulAzeez on Aug 23, 2009 22:14:05 GMT 1
The Nigerian agricultural sector has received grants from two international agencies to help develop and improve capacity for food production in the country.
The grants approved by the two international agencies are to help farmers increase their incomes and to meet the market demands in the agricultural sector. The International Funds for Agricultural Development (IFAD) gave a loan of $40 million in which twelve states from the six geo-political zones in the country are to benefit from.
The Minister of Agriculture and Water Resources, Dr Sayyadi Ruma, told the journalists in Abuja on Tuesday that the loan given by (IFAD) was in support of the implementation of the Rural Financing Institution Building Programme (RUFIN).
Mr. Ruma said the State that would benefit from the loan are Adamawa, Bauchi, Katsina, Zamfara, Nasarawa, Lagos, Oyo, Benue, Anambra, Imo, Akwa Ibom and Edo.
About 345,000 households spread across the states would benefit from the programme, including 138,000 women headed-households. The targeted beneficiaries include the vulnerable poor families and families that are food insecure.
The other direct beneficiaries will be 70 micro-finance banks, 70 non-bank micro finance institutions, the CBN, Nigerian Agricultural Cooperative and Rural Development Bank, as well as research institutions, he said.
Mr. Ruma said RUFIN is targeted at the poor because they lack access to financial service; they have limited access to land, while their agricultural productivity is low.
The funds, which is to be released by the United States African Development Foundation, unlike the one by the IFAD will have the Da All Green Seeds Limited (DAGS), located in Zaira City, Kaduna State as a beneficiary.
The chairman of USADF John Agwunobi said that "USADF is an agency of the U.S. government, and its funding comes from the American people for the purpose of supporting economic development at the community level in Africa.
DAGS produces sorghum seeds to 2,052 farmers on credit who sell back the harvested sorghum to DAGS at above market rates and DAGS then processes and sells to wholesale producers of malt drinks using sorghum as a main ingredient.
Mr Agwunobi said "the five year grant will enable DAGS to increase production by purchasing more seeds and expanding its buyback programme from farmers, increasing farmers' salaries.
Specifically, the grant will finance a fund for buyback of sorghum, an input fund to allow farmers to purchase improved inputs, website development and radio advertising, capacity building of the farmer groups, and training".
The government has been promising various agricultural funds to the farmers in order to help develop the agricultural sector and reduce the country's reliance on crude oil as a source for foreign exchange.
The various funds are yet to be received by the farmers as the N200 billion agricultural funds promised by the Central Bank of Nigeria and the Federal Government is yet to be disbursed due to the controversies on the disbursement guidelines and the banks to carry out the disbursement.
A source at the Ministry, however, said that there is a possibility for the N200 billion fund disbursement to begin in the next few weeks. The News Agency of Nigeria reports that the IFAD loan, to be repaid in 40 years and with a 10 year grace period will attract 0.75 per cent service charge annually.