The Federal Government, in a bid to stimulate finance to the agriculture sector, has approved that the sum of N15bn be given to farmers at single-digit interest rate.

The amount, which is a short-term intervention fund to be disbursed by the Bank of Agriculture, will be used for the 2013 farming season.

Vice-President Namadi Sambo disclosed this on Thursday in Abuja while speaking at the closing ceremony of the 19th Nigerian Economic Summit.

The three-day summit had as its theme: ‘Growing agriculture as a business to diversify Nigeria’s economy.’

Sambo also said in demonstration of the determination of the Federal Government to transform the agric sector, President Goodluck Jonathan had given approval to the National Council on Privatisation that the BoA should be privatised.

The privatisation of the bank, he noted, would enable the Federal Government to unbundle it and make it possible to provide cheaper funds for agriculture.

The unbundling of the bank, the vice-president added, would also allow other investors to participate fully in its activities.

Sambo also noted that the approval for the privatisation of the Commodities Exchange had been given by the President.

The revival of the commodities exchange, he added, would help to ensure that farmers had a market for their produce for sustainability of agricultural production.

He said, “The government is also mindful of the problems of access to finance and the current high interest rates on funds faced by our farmers.

“But in this regard also, Mr. President has approved a grant of N15bn to the Bank of Agriculture to be provided to our farmers for the 2013 farming season at one digit low interest rate for this year.

“This is a short-term intervention and the Chairman (Nigerian Economic Summit Group) has said we must have long-term continuous process. So, in this regard, the National Council on Privatisation has been granted approval by Mr. President to privatise the Bank of Agriculture.

“This is in order to unbundle it and make it possible to provide cheaper funds for agriculture and allow other investors to participate in our agricultural bank.

“The revival of the commodity exchange to ensure that farmers have a market of their produce for sustainability of agricultural production is in progress and Mr. President has also approved the privatisation of our commodity exchange.”

In addition, Sambo said the Minister of Finance, Dr Ngozi Okonjo-Iweala, was currently working on how to establish a Nigerian Development Bank to allow access to funds for infrastructure development.

This, he added, would help to provide long-term and low interest rate funds in the country.

On the challenges currently facing the agriculture sector, the VP said, “We are also addressing all the bottlenecks that will allow growth and development of the agriculture sector.

“In this regard, we will ensure that land security is assured for investment in the agriculture sector. This is why Mr. President set up the Presidential Commission on Land Reforms.

“This committee has reached an advanced stage (in its assignment). Without security of land, it will be difficult for investors to have the security needed for investment in land improvement.”

He said the Federal Government would take practical steps to implement the recommendations of the summit, adding that this would help to change the face of agriculture in the country.

Sambo added that going forward; agriculture would no longer be treated as a development programme but a business.

He said the unlocking of the potential of the agricultural sector would help to ensure food security, generate wealth and create jobs.

Source: Punch (by Ifeanyi Onuba)