Agric commodities’ import tops N630b, says Emefiele
Emefiele, who made the disclosure in Lagos at a workshop organised by CBN and the Alliance for Green Revolution in Africa (AGRA) on Innovative Agricultural Products, noted that the large import of food products include wheat, rice, flour, fish, tomato paste, textile and sugar.
He said that the sector provides 70 per cent of existing employment in the country, with 42 per cent contribution to the Gross Domestic Product (GDP), but lamented the high level importation of food products.
Meanwhile the bank chief said that all is set for the reactivation of the agriculture sector’s insurance scheme-the Nigeria Incentive-based Risk Sharing System for Agricultural Lending (NIRSAL), in a move to lure more farmers, as well as help reduce risks associated with the sector’s financing.
“NIRSAL is built on 5-pillar; 1st and 2nd pillar, which are risk-sharing and technical assistance have been activated. While, the 3rd pillar is the insurance, which is been activated today.
“This workshop signals the kick-starting of the insurance pillar. We have the 4th and 5th pillar known as bank rating and bank incentive, respectively. The bank rating and the incentive can commence after the insurance pillar,” he said.
He however, called for development and expansion of the agricultural insurance sub-sector, as this will go a long way in mitigating against natural disasters and eventually encouraging banks to lend to agriculture.
“Expansion of agricultural insurance products has become imperative especially now that climatic reports have it that Nigerian farmers are prone to risks from natural disaster such as flood, draught as well as different crop and livestock diseases,” he said.
Emefiele, who was represented by the Acting Managing Director of NIRSAL, Edwin Nzelu, stated that with banks’ four per cent lending of all formal credit to the agricultural sector, the lending is still low because of the lingering perception by banks that agriculture is highly risky.
The CBN helmsman, however, emphasised more on the need to diversify the mono-cultural tendencies of the Nigerian economy by developing other sectors of the economy especially agriculture.
“We were known to be exporters of cocoa beans, gum Arabic, groundnuts, cotton, palm oil and many other agricultural commodities, but now, we import most of the agricultural commodities that we can produce because of the neglect of the sector in addition to rural migration to cities in search of white collar jobs,” CBN boss decried.
Commissioner for Insurance and Chief Executive of the National Insurance Commission (NAICOM), Mohammed Kari said the one of the objective of the Commission was to deepen insurance penetrating in the agriculture sector.
Kari, who was represented by the Deputy Director, Lagos office of NAICOM, Faruna Monday, however, urged private insurance companies to take advantage of this opportunity and consider extending insurance cover to the agricultural sector to create a competitive market, which will eventually increase insurance penetration to rural areas.