Business

NIGERIA: Industrial Revolution in the Agric Sector

President Goodluck JonathanRecently, President Goodluck Jonathan launched the Nigeria Industrial Revolution Plan (NIRP) and the National Enterprise Development Programme (NEDEP), plans which are expected to usher in a new era for industrial, micro, small and medium enterprises development in the country. But it’s success partly depends on the expected fortunes in the agricultural sector, writes Adebiyi Adedapo
 
President Goodluck Jonathan described the Nigeria Industrial Revolution Plan (NIRP) as the most ambitious and comprehensive road map that would transform the nation’s industrial landscape, boost skills development, enhance job creation, and conserve foreign exchange.
 
He explained that the plan was the most ambitious and comprehensive industrialisation programme, since it is based on agriculture/agro-products, metals and solid minerals, oil and gas, construction and light manufacturing services, where Nigeria has a competitive and comparative advantage.
The President however expressed optimism that Nigeria would rank number one in Africa and in the top 10 globally in these sectors.
 
Right Perspective
Putting the agricultural sector in perspective, it is pertinent to enumerate the prospects and defects of the projected industrial revolution, through the Agricultural Transformation Agenda (ATA) of the federal government.
First and foremost, the Federal Ministry of Agriculture and Rural Development (FMA&RD) has made available the sum of N3.6 billion to enhance the National Agricultural Mechanisation Transformation Agenda (NAMTA), a public private partnership scheme geared towards addressing the low level penetration of mechanised agricultural practice in the country.
In the first phase of this programme, government will make available 400 units of tractors, 500 power tillers as well as harvest and post-harvest equipment towards setting up a minimum of 80 agricultural mechanised centres across the nation; this will be replicated in the second phase, while 250 tractors will be made available in the third phase.
 
Ministerial Plan
The plan is part of the ongoing Growth Economic Empowerment (GES) scheme, a brain child of the Minister of Agriculture and Rural Development, Dr. Akinwumi Adesina. The Minister had repeatedly explained that Nigeria’s agricultural mechanisation practice is very low, thus affecting production capacity.
 
According to Adesina, fifty per cent of Nigeria’s 30,000 tractors are out of service, which brings the level of mechanisation in the country to about 0.03 horsepower per hectare; against the 1.5 horse power recommended by the Food and Agriculture Organisation (FAO).
He also stated that the 45 per cent subsidy on the cost of imported tractors by the federal government did not achieve desired impact, as the intervention remained minimal since small scale farmers who account for 80 per cent of food producers in the country have little or no access and can neither afford to buy nor hire the equipment.
 
“This low level agricultural mechanisation in the country limits the capacity of Nigerian farmers to expand their cultivation areas, perform timely farming operations and achieve economies of scale in raising food production. Nigeria needs a minimum of 746, 666 tractors equipped with tillers and other support gadgetry to sufficiently mechanise agriculture going by best practices,” he said.
Adesina who confirmed that the federal government had approved release of the N3.6 billion intervention fund, said the fund was domiciled in the Bank of Agriculture towards the establishment of Agricultural Equipment Hiring Enterprises (AEHE).
 
Preventing Diversion
Nigerians can only pray that this fund is not, as usual, disbursed to pen-farmers (friends and cronies of BoA managers) who always hang around for such opportunities.
According to the plan, 1,050 units of tractors, 1,500 power tillers and 2,400 units of harvest and post-harvest equipment such as reapers, grain threshers, and cassava peelers would be provided to set up 210 AEHE’s in demand-driven locations nationwide. The intervention is expected to create 6,090 direct jobs for unemployed youths.
 
“The intervention will create 6,090 direct jobs for unemployed youths, mechanise a minimum of 488,250 hectares of land, while 2,441,250 metric tonnes of food will be added to the national food output. Taking cognisance of the difficulties encountered by rural farmers, Government for a start will clear 6, 400 hectares of land nationwide for cassava production,” Adesina stated.
 
Tackling a Challenge
With the perceived initial success of GESS Phase 1, and the mapped-out plan of agricultural mechanisation, the challenge of processing the proceeds becomes imminent.
In view of this, the federal government launched the Stable Crop Processing Zones (SCPZs) initiative, aimed at adding N1.4 trillion to the nation’s economy.
 
This initiative, which is the second phase of the GES scheme, is designed to establish 14 SCPZs across the federation. It would provide ready market for farmers, reduce cost of doing business, and at the same time reduce post harvest losses.
Six SCPZs selected under the first phase, are located at Bunkure in Kano state for Rice, Tomato and Sorghum processing, Agbadu-Alape in Kogi state for cassava processing, Badeggi Niger state, Omor in Anambra state/ Adani in Enugu state also for Rice. Others are located in Ketu in Lagos state and Okorolo in Rivers state for fisheries and aquaculture processing.
 
UNIDO Intervention
The United Nations Industrial Development Organisation (UNIDO) a co-sponsor of the project, estimated that the six SCPZs will gulp about $1,063.1 billion.
UNIDO, through its representatives, Dr. Chukwuma Ezedinma, while unveiling SCPZs master plan recently, at a one-day stakeholders’ workshop on effective implementation of the project said the funds would cover specialised and support facilities including external infrastructure, such as road connectivity, highway strengthening, rail connectivity, air and seaport connectivity, power linkages and external water supply linkages.
 
According to figures presented by UNIDO, SCPZ in Badeggi would gulp $181.4 million, Bankure – $151.1 million, Omor – $186.6 million, Okorolo – $79.6 million, Allape – $314.7 million, and Adani – $149.7 million.
 
Vital Objective
The Minister boasted about the SCPZs creating additional 250,000 jobs in the various value-chain sectors, as he said the primary goal of substituting import and adding value to local agricultural produce was to serve the vast and growing local market.
According to him, the main objective of the SCPZs was to facilitate agro-processing environments that would be used to attract private sector investments into the local production and processing of Nigeria agricultural produce.
 
“The SCPZs will reduce the cost of doing business for agro-processors to ensure their competitiveness, and to create ready markets for Nigerian farmers thereby reducing post-harvest losses. Successful implementation of the SCPZs is estimated to potentially add 660 billion to N1.4 trillion to the Nigerian economy and create up to 250,000 jobs. The SCPZs will be equipped with desirable infrastructure and service, while the surrounding food production clusters will also be developed with the required operational infrastructure to ensure optimal productivity,” he said.
 
Moving Forward
Also, the Permanent Secretary FMA&RD, Mrs. Ibunkun Odusote, at the workshop disclosed that private sector investors have been secured for the Alape, Badeggi and the Bunkure SCPZs, i.e. Cargill USA, (the world largest food processing company) Nigeria Flour Mills, and Dangote group respectively.
She said the master plan and the Environmental Impact Assessment (EIA) had been completed, and thereby sought to move to the sites for implementation.
 
But aside the EIA, some other factors should be considered to ensure safety of the programme in the long-run. Firstly, the chemical inputs used in realising bumper yields expected to meet the demands of these private investors should be applied with caution.
It is ironical that developing countries including Nigeria intensify efforts on the use of chemical fertilisers, at a time when developed countries are campaigning massively against agro-chemical practice.
At the 2014 Agric Ministers summit held January in Berlin, it was declared that sustainable farming must be economically sound, ecologically compatible and socially responsible.
 
Ministers of Agriculture from 65 countries, in a communique issued at the end of the summit, affirmed that the use natural resources, in particular soil and water, in a manner which preserves the soil for future generations is the safest form of agricultural practice.
Recently, the ministry distributed 800 motorcycles to extension workers so as to encourage coordination and monitoring of quality technical support to farmers. This, if effectively implemented, will bridge the linkage between extension, education and research institutions, and ensure constant flow of innovative technologies and practice.
Secondly, some of the planned SCPZs are designed along mono-cultural cultivation practice, which is also being discouraged globally to encourage agro-diversity.
 
A Senior Research Fellow on Land and Water at the United Nations University, Institute for Natural Resources in Africa, Dr. Effiom Oku had advised that agro-diversity should be promoted in Africa now than ever.
Oku, who also lectures at the department of Soil Science, University of Abuja, explained that the practice is a climate change adaptation farming strategy, which has an advantage of increasing farmer’s farm productivity and income as against mono-cultural farming.
 
“It is an insurance against failure of one crop as in the mono-cultural system. African traditional farming system inherently has elements of diversity,” he said.
 
All things been equal, although the industrial revolution in the agricultural sector may be real, it must be pursued with extreme caution, so as not to endanger the country’s arable soil and in the long run.
 
Also, stakeholders in the agric sector, especially the newly inaugurated executive team of Nigeria Agribusiness Group (NABG) under the leadership of Alhaji Sanni Dangote, should reason beyond the immediate profit making venture and ensure that ecological safety measures are considered. This will only ensure a sustainable sector and guarantee a secured agri-business environment.

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