Three months has passed since NIRSAL (Nigeria Incentive-based Risk Sharing System for Agriculture Lending) was first invited by the DAWN Commission – a Development Organisation set up by the Governments of the States of Western Nigeria (SoWN) – to help it think up agricultural ideas for rapid regional development and prosperity. As a testament to the success of that first contact, another meeting – an expanded one – was held last week.
The goal is to prepare agricultural commodity value chain templates for each of the member states to serve as information bases for discussing agricultural development with governments of the region and financial institutions. These engagements would also serve to help the commission propose the optimization of existing agricultural schemes to their respective governments and the need for synergy and collaborations across states.
Agribusiness opportunities abound in Nigeria’s South-West, especially in Cocoa. The region is the reason for Nigeria’s high ranking in global cocoa production – 5th, and for the export of cocoa beans worth N14.5billion in 2017. The South-West also enjoys production advantages in Oil Palm, Cotton, Cassava, Yam, Rice, Aquaculture and Livestock.
Arable land in the South-West is estimated at 890,000km2, of which only 380,000 is under cultivation. To activate more land for agricultural primary production, sizeable investments need to go into land development, and diverse initiatives for agricultural real estate acquisition and use put forward.
A colossal member of the Dawn Commission is the paradoxical Lagos: smallest state by land mass, but largest in population – 22million people (estimated). Lagos has an immense market for red meat and rice, and a grave need for the economic empowerment of women and youth. Within the scope of NIRSAL’s engagement with Dawn Commission are achievable targets of a 159hectare Feedlot for livestock, and the development of a Coconut value chain with community processing centers along the coastlines.
As has been mentioned, a lot is achievable in the South-West with regards to agriculture. Annual rainfall is good, the region has comparative advantage in several crops and the labour force is young and strong. NIRSAL is excited about this journey with the South-West through the DAWN Commission.
The Nigeria Incentive-Based Risk Sharing system for Agricultural Lending (NIRSAL) was launched in 2011 and incorporated in 2013 by the Central Bank of Nigeria (CBN) as a dynamic, holistic USD500 Million public-private initiative to define, measure, price and share agribusiness related credit risk.
NIRSAL is designed with the objective of catalysing the flow of finance and investment into fixed agricultural value chains. It further seeks to address the causes of low funding levels in the agriculture sector, including lack of understanding of the sector, perceived high risks, complex credit assessment processes/procedures, and high transaction costs.
NIRSAL operated as a project implementation office in Development Finance Department of the Central Bank of Nigeria until the appointment of its executive management team on the 23rd day of December 2015.
Source: NIRSAL Connect