The Central Bank of Nigeria (CBN) is ramping up intervention programmes with an eye on boosting the industrial sector of the economy and food security.
A miracle is already happening in the once forgotten cotton industry, with the apex bank approving N19.2 billion to fund the establishment of nine ginneries across the country, leading to a return of cotton pyramids.
“We are improving the links between cotton farmers and ginneries, by ensuring that ginneries are able to off-take the high-quality cotton produced by these farmers. The same support will be extended to the textile and garment firms,” Godwin Emefiele, CBN governor, said in October 2019 at the signing of a Memorandum of Understanding (MoU) with critical interest groups in the Cotton, Textile and Garment (CTG) subsector in Abuja.
The Nigerian textile industry is challenged by smuggling, poor competitiveness and lack of high quality cotton. But experts say the springing up of ginneries could help few surviving textile firms to stay afloat.
Apart from cotton, several large corporates in the palm oil industry have received the apex bank’s N30 billion intervention fund with a view to reducing $500 million annual import.
Emefiele said in September 2019 at a stakeholders’ meeting in the nation’s capital that PZ Wimar, Biase Oil Company Ltd, Eyop, Okomu Oil Company, Presco Oil Company and SIAT Ltd had all benefitted from the fund, adding that application for Ada Palm in Imo State was being expected.
Emefiele pointed out that annual demand for palm oil in Nigeria was 2.5 million metric tons of which only 1.25 million metric tons were produced locally, leaving a gap of 1.25 million metric tonnes per annum.
“This gap is currently being met through imports,” he said. “The Central Bank of Nigeria Oil Palm Initiative is aimed at closing the gap and also positioning Nigeria to incrementally export oil palm products to neighbouring African countries and beyond.”
Emefiele said closing the identified gap would require bringing about 312,500 hectares under modern cultivation at an estimated yield of 4 metric tons per hectare.
“Our target is to ensure that a minimum of 1.4 million hectares of land is put under oil palm cultivation in three years,” he said.
At the Bankers Committee meeting in April 2019, it was disclosed that the Federal Government planned to give N200bn intervention fund to boost the production of oil palm, cocoa, sesame seed, shea and cashew through the Central Bank of Nigeria.
The bank has already funded thousands of rice farmers to support the government’s policy on food security, import-substitution and improved health.
Billions of naira has been rolled out for the project through the Anchor Borrowers Programme to boost local food production, employment and agro value chain.
“Lots of rice farmers are increasing their production areas because there is a huge market for paddy,” said Aminu Goronyo, national president, Rice Farmers Association of Nigeria, told BusinessDay recently.
“This is because millers are patronising rice farmers now and off-taking all that they produce immediately,” Goronyo said.