At the annual bankers’ dinner last December, Central Bank of Nigeria (CBN) governor Godwin Emefiele let out an update on the flagship agricultural credit initiative of the Muhammadu Buhari administration, the Anchor Borrowers Scheme (ABS) launched in 2015. Under the scheme, small holder farmers are supplied farm inputs in kind and cash (for farm labour), to boost production of the identified commodities and consequently to stabilise inputs supply to agro-processors at a moderate interest rate of nine percent per annum.
According to Emefiele, “As at October 2018, a total number of 862,069 farmers cultivating about 835,239 hectares, across 16 different commodities, have so far benefited from the anchor borrowers programme, which has generated over 2.5 million jobs across the country”. Enthused by the success of the scheme, the Monetary Policy Committee, he stated, had in its meeting of November 21, 2018, recommended the inclusion of palm oil, tomatoes, and fisheries to mention a few, in the scheme. In all, N160 billion is said to have been disbursed under the programme till date.
Last week, The Punch reported that the Commercial Agriculture Credit Scheme (CACS) – another initiative of the apex bank, had as at November 19, 2018, granted a total credit of N596.44billion covering a total of 576 projects, of which 34 are in respect of state governments. When added to the billions annually disbursed to farmers under the Agriculture Credit Guarantee Scheme (ACGS), also promoted by the apex bank – a programme designed to provide guarantees on loans granted by banks to farmers for agricultural production and agro-allied processing – they certainly reflect not just the priority of the Federal Government, but the pivotal role being played by the apex bank in providing scarce credit on such terms that are increasingly reasonable and competitive to the Nigerian farmer.
Yet, it is tempting – at another plain – to see the development as another familiar Nigerian pastime of throwing cash at fundamental problems. An immediate concern is whether the apex bank, by the sheer number of initiatives already in place, is not actually biting off more than it can chew, or as it is increasingly proving to be, a case of simply putting new wines in old wineskins.
Yes, we agree that the sector needs as much credit as the system can afford. Not only that, we also agree that the apex bank has a crucial role to play in catalysing the flow of credit to the sector. What is debatable is the overall usefulness of the multiplicity of related schemes in an environment where other basic factors necessary to guarantee success of the programmes are more often than not, unavailable. But even more important is whether a number of these activities could not have been better shouldered by the bank established precisely for this purpose – the Bank of Agriculture.
So, while a lot has been said of how lack of investment has hobbled the development of strategic linkages in the agricultural value chain, from transportation to storage, preservation and marketing, Nigerians cannot but wonder whether the way forward is to have multiple but disparate programmes to address the different aspects of the same problems.
Which of course takes us to another level – the question of whether adequate mechanisms currently exist to coordinate and evaluate the impact of the various initiatives. Here, we see the update by the apex bank on the performance of the ABS as only the starting point. Not only do we expect such routine updates on the ACGS and the CACS, it seems about time the Federal Government put an independent coordinating body in place to monitor the impact of the various intervention programmes being undertaken by the apex bank, particularly in the agricultural sector.
That way, it would be easier to determine which of the initiatives are measuring up to their objectives and those that are not, to enable government make appropriate policy interventions.