It must be surprising to many that an initiative set up less than three years ago to transform the agricultural sector in the country is closing in on accomplishing almost all its mandates.
The Presidential Fertilizer Initiative (PFI) took off in 2017 after the visit of the King of Morocco to Nigeria in December 2016 and the subsequent signing of a three-year bilateral agreement with Morocco for the supply of Di-ammonium Phosphate (DAP), a key ingredient for fertilizer production.
Prior to the agreement, the Nigeria’s fertilizer industry was in comatose, with only five blending plants operating below 10 percent of installed capacity. No one expected a miracle to happen on account of the agreement between Nigeria and Morocco due to the well-documented cases of corruption that had plagued the sector, and which had shortchanged Nigerian farmers for decades.
The mandate of PFI was to make high quality fertilizer available to Nigerian farmers at the right time and at an affordable price, and to revive the ailing fertilizer blending industry so that Nigeria could achieve food security.
Three years down the line, PFI has proven to be a legacy initiative that has changed the agricultural and agro-business industry in the country for good.
It has achieved a substantial chunk of its mandate in a way that recommends it as a model for government intervention in critical sectors and a template for government-led import substitution.
Investigations show that the involvement of the Nigerian Sovereign Investment Authority (NSIA) as managers of the initiative seemed to have changed the dynamics for the President Muhammadu Buhari administration which hoped to diversify the economy away from oil into agriculture.
Having been invited to serve as programme operator and fund manager, the NSIA subjected the PFI to its own governance processes which ensured accountability and transparency at all stages of the procurement, production, and sale processes.
Documents seen by DAILY INDEPENDENT indicate that the PFI is operated under a governance system that subjects its operations to regular audit by PricewaterhouseCoopers, a reputable audit firm.
Financial statements on the NSIA website however, indicated that since the inception of the scheme in 2017 up to 2019, N107 billion has been invested in PFI while another estimated N114 billion is billed to be invested in 2020 – on items that cover raw materials, logistics, contract blending costs by 3rd party blenders among others.
Insiders explained that the programme has revived operations in a total of 31 blending plants thereby increasing domestic production capacity by nearly 300 per cent and improving the quality of fertilizer available to domestic farmers.
“This cannot be possible without strict control systems which ensure that we monitor the flow of materials and funds,” said a source at the PFI, adding that “the auditors have yet to report any case of fraud due to the controls that had been put in place”.
For instance, he said to mitigate against pilferage under the programme, there is a joint security task force which is superintend by the Office of the National Security Adviser (ONSA). The task force oversees the monitoring of movement, storage and general handling of raw materials and finished products alongside appointed Collateral Managers who ensure quality, consistency in weight and mix per bag of NPK 20:10:10 to avoid adulteration. In addition, he said, Collateral Managers routinely review and conduct assessments of each blending plant to ensure contractual standards are upheld.
Moreover, the initiative has created more jobs for Nigerians. According to Fertilizer Producers & Suppliers Association of Nigeria (FEPSAN) estimates, over 100,000 new jobs have been created outside farming jobs. It has created jobs in other sectors of the economy such as logistics, haulage/transportation, ports management, bag manufacturing, industrial warehousing, and micro-economic activities in and around the blending plants.
Apart from boosting economic activities in the country, FEPSAN estimates that the PFI has saved Nigeria hundreds of millions in foreign exchange to date and billions of Naira in budgetary subsidy which no longer had to be paid.