FG’s Agriculture Policy Intervention Strengthening Smallholder Farmers


Tthe federal government after years of neglect of the agricultural sector, beginning in 2010 and 2011, began a major reform of the industry. To reorient the sector, the government introduced a new strategy, the Agricultural Transformation Program (ATA), and in 2011 until 2016, the focus was on rebuilding the sector, whose importance has dramatically decreased.

This was reflected in the lack of lending to farmers by the financial system and the sharp levels of food imports from around the world, and the intervention, ATA, served its main purpose – to help focus Nigeria's attention on agriculture.

At each stage of the reform, agricultural financing was recognized as critical to producers of all sizes (from small farmers, medium-sized farmers and large commercial farms), and from properly functioning supply markets, processors and traders.

In addition to access to capital, defined as the volume and price of capital, the related problem includes competition, and it is crucial that the financing and risk management tools are available from several sources (channels), except for the conventional banking system; examples are public capital markets, private equity and other non-banking channels.

However, the current efforts to mitigate these problems, although partially successful, for example, increasing lending from one percent in 2011 to six percent in 2015, can do even more. Based on previous discussions between the Central Bank of Nigeria, the CBN, the Banking Committee, the Federal Ministry of Agriculture and Rural Development, the FMARD and the Nigerian Risk Sharing System for Agricultural Lending, NIRSAL Plc, 10 percent of all official loans were granted to switch to agriculture 2017 – 2018 years.

Access to insurance contracts also remains a problem, as while new suppliers are licensed by the National Commission for Insurance for Retail Agricultural Insurance, the Nigerian Agricultural Insurance Corporation, NAIC remains the dominant supplier. Nevertheless, the level of agricultural insurance penetration remains below three percent, measured by the coverage areas and culture covered by farmers, compared to 10 percent (using India and China as proxies), which would be a reasonable target by 2021.

The government, of course, remembers the fact that small farmers are undoubtedly the key stakeholders in their application for diversifying the economy, which is heavily entrenched in agriculture. They also play an important role in the realization of the United Nations sustainable development goals (SRS) aimed at eradicating poverty and hunger.

Nevertheless, efforts to create an enabling environment for them and other entrepreneurs in agriculture have not been successful, as the critical problem remains insufficient for access to financing, markets and support systems, such as infrastructure, skills, information on modern methods of doing business agriculture and improved technology in the agricultural value chain.

Given the huge share of small farmers in the production of locally consumed products, accounting for about 70 percent of all agricultural products, agricultural experts agreed that these farmers can no longer be ignored.

For the long-term development of the agricultural sector and the empowerment of farmers, the participation of the private sector is key, since the government can not provide all solutions alone. This underlines why agriculture is on the list of priorities for corporate social investments of multinational companies. At the same time, they coordinate their schemes of agricultural intervention with the existing state policy and the United Nations goals for sustainable development.

Known are such events as the Shell Petroleum Development Company (SDPC), the British American Tobacco Nigeria Foundation (the Nigerian BAT Foundation), the Bill and Melinda Gates Foundation, A. Leventis and others.

These organizations work directly with rural communities in Nigeria to provide funding for small-scale agricultural producers and community-based organizations. They also conduct capacity building trainings for farmers to train them in modern farming methods, thereby increasing production and ensuring food security and accelerated economic development.

For example, the goal of corporate social investment of the GRPC is the development of the Niger Delta region through schemes for expanding economic opportunities in agriculture and other areas. Among other interventions related to agriculture is the creation of poultry farms and agro-processing plants (cassava, oil palm and rice mills).

Another impressive and successful model for empowering small farmers is the agricultural intervention of the British American Tobacco Nigeria Foundation. The NDT Nigeria Fund enables farmers to learn the skills of using good agricultural practices, creates access to financing by offering agricultural resources to small farmers to grow at least one hectare of land, and most importantly, to keep in touch with sales and income markets.

Mandate cultures supported by the BAT Nigeria Foundation include cassava, corn, rice and vegetables. Fish farmers do not stay behind, they are often empowered by donating technological equipment, such as a smoking stove, to contribute to the value chain of fish. Project interventions are carried out in six geopolitical zones, and they carried out more than 180 projects in all 36 states and on the territory of federal capital.

The project is being implemented at the grassroots level in partnership with the State Agricultural Development Program, international development agencies and national non-governmental organizations (NGOs). The ultimate goal of the Foundation is to empower rural Nigerians to a sustainable future by migrating small farmers from the subsistence minimum to commercial agriculture and by creating agribusinesses out of them.

Before any community initiative or intervention, the BATN Foundation seeks to understand what the problems are, to create support mechanisms that meet their specific needs.

In addition to access to markets, finance, information or skills is a problem of climate change. Increasingly, the weather becomes unpredictable with precipitation coming in the dry season, and vice versa. Small farmers-farmers who usually practice rain farming and do not have the necessary scientific knowledge on how to deal with the phenomenon of climate change are most exposed to the severe consequences of climate change.

Aware of these climate-related problems, the Bill and Melinda Gates Foundation at the One Planet summit in Paris on December 12, 2017 pledged $ 300 million over the next three years (2018-2020) to support agricultural research that will help the poorest farmers adapt to the harsh conditions caused by climate change, including temperature increase, extreme weather conditions (droughts and floods), diseases, poor soil fertility and pest attacks.

In addition, the Nigerian Metrology Agency (NiMet), which is the official source of all weather information in Nigeria, is working with agricultural institutions and the private sector to provide correct weather information for farmers at the right time.

Interventions in agriculture are not complete without any involvement in the formulation and implementation of agricultural policies in the country, especially with regard to small farmers.

The Bill and Gates Foundation strengthens global and national policies that benefit small farmers. Its investments help policymakers, donors and civil society to identify policy priorities based on evidence, formulate options for cost-effective policy implementation, and use resources for comprehensive transformations in agriculture at the global, national and local levels.

Similarly, the BAT Nigeria Foundation uses its advocacy channels to draw government's attention to problems affecting small farmers and supporters of ensuring that government policies and incentive packages are among them. One of the platforms on which it is being promoted is the two-year session of the dialogue on small farmers and sustainable agriculture.

Given the positive impact of the intervention of several members of the private sector on small farmers, as well as on other operators in the value chain of agriculture, it is envisaged that a more active participation of more members in this sector, especially national and multinational organizations, may be a stimulant, necessary to stimulate the exponential growth and development of the agricultural sector in Nigeria.

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