Mohammed Ibrahim, executive secretary /CEO of the National Agricultural Development Fund, has said the Fund has adopted the blended financing model to bridge the $180 million agricultural funding gap.
The CEO said that the Central Bank (CBN) had suspended the import duty on rice, sugar, dairy, and lifestyle products, causing the Fund to lose an income line . He saud the Fund needed to adopt the blended model to raise capital.
Speaking during an interactive session with the Agricultural Correspondents of Nigeria in Abuja (ACAN)in Abuja on Thursday, the CEO said the bank was created by an Act of Parliament to bridge the gap in the agricultural sector
In his words “The NADF was set up because budgetary allocation cannot sustain agriculture. Recall that Nigeria was a signatory to the Maputo Declaration on Agriculture and Food Security which advocates setting 10 per cent national budget allocation to agriculture development, which Nigeria has not been able to meet.
“To fund agriculture, we needed to have a global perspective, so we decided to Xray the landscape and have been able to put up a 5-year strategic plan to enable us to achieve our mandate,” he said.
“Our special pillars/priority areas for a short time are seeds and fertilizers, implements and mechanization, Infrastructure, increased storage for productivity as well as responding to emergencies in the sector.”
He added “Within the strategy, our priority investment target is to see that we are able to fund as many small holder farmers and we have chosen women and youths as our priority areas. In our efforts to also be as focused as possible, we also prioritise the crops – cassava, rice, maize and cowpea. These four crops have been carefully chosen because they represent the largest retinue of farmers that our country has. We are not discounting others, but we want to focus and that is why we are prioritising.”
Speaking on funding for the project, Ibrahim said, “The NADF collects 5 percent of import duty levels on rice, sugar, poultry, dairy, and lifestyle. However, this line of charge has been suspended as import duty on certain food items was suspended, so we have lost an income line there.
“Secondly, we take 0.05% of the NRDF, I believe it is 1.86% of FARC allocation. And then the third is that we are to be funded through appropriation. However, as a fund, we are allowed to, by our act, raise capital. We are allowed to go out, afford to seek capital, bring in investors, and do that. That is the essence of the fund. A fund is not a bank.”
On the deployment of the Fund, Ibrahim said, “We have three classes of deployment of our finance, they are debts, equity and grants”
He added, “As policy drivers, it is very important that we have extremely strong frameworks for whatever we are doing, especially in finance. We all know the challenges we’ve had in the form of agricultural financing, the financing gap in agriculture, is estimated to be about $180 million
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