In a significant effort to bolster Nigeria’s agricultural sector, the Federal Government disbursed an impressive N629 billion to farmers through the Anchor Borrowers Programme (ABP) in the year 2022. This revelation comes from the Central Bank of Nigeria’s (CBN) recently released 2022 financial report, which sheds light on the substantial lending initiative aimed at fostering agricultural growth.
The ABP, a brainchild of the administration led by former President Muhammadu Buhari, was launched in November 2015 with the aim of enhancing agricultural production, augmenting foreign exchange reserves, and reversing the nation’s adverse food trade balance. The programme provides loans to smallholder farmers engaged in cultivating various crops, including cereals, cotton, roots and tubers, sugarcane, tree crops, legumes, tomatoes, and livestock.
These loans are disbursed through a network of Participating Financial Institutions (PFIs), encompassing Deposit Money Banks (DMBs), Development Finance Institutions (DFIs), and Microfinance Banks (MFBs). Beneficiary farmers are required to repay their loans by delivering their harvest to designated ‘anchors,’ who then provide cash equivalents to the farmers’ accounts.
Although the 2022 disbursement of N629 billion represents a reduction from the N949.2 billion allocated for the initiative in 2021, the impact of the ABP on Nigeria’s agricultural landscape has been significant. A notable surge in the nation’s yearly maize production has been observed between 2014 and 2022, signifying a positive trajectory. This increase in production has elevated Nigeria’s position globally, ranking 14th in milled rice and 13th in maize production.
While the ABP has contributed positively to agricultural growth, challenges have arisen due to irregularities impacting production and loan repayment. The programme’s success has been tempered by its fair share of obstacles, emphasizing the need for continuous refinement and monitoring.
Despite these challenges, the Federal Government’s commitment to supporting smallholder farmers through the Anchor Borrowers Programme remains a vital step towards achieving sustainable agricultural growth and food security in Nigeria. The N629 billion disbursed in 2022 represents not only a financial investment but also a step towards realizing the potential of the nation’s agricultural sector.
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