In a strategic move to enhance food security and support smallholder farmers, the Nigerian government has announced the recapitalization of the Bank of Agriculture (BOA) with an infusion of N1.5 trillion. This initiative aims to address the longstanding challenges faced by farmers in accessing adequate financing, thereby stimulating agricultural productivity across the nation.
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Empowering Smallholder Farmers
Smallholder farmers constitute a significant portion of Nigeria’s agricultural sector. However, they have historically struggled with limited access to credit facilities, hindering their capacity to expand operations and adopt modern farming techniques. The recapitalization of the BOA is poised to bridge this gap by providing tailored financial products that meet the unique needs of these farmers. With branches in all 109 senatorial districts, the BOA is strategically positioned to reach farmers nationwide, ensuring that the benefits of this funding are widely distributed.
Tackling Food Inflation
Nigeria has been grappling with high food inflation, which stood at approximately 34% in early 2025. By bolstering the BOA’s capital base, the government aims to increase agricultural output, thereby stabilizing food prices. Enhanced agricultural productivity is expected to lead to a more abundant supply of food commodities, which can help in moderating prices and making food more affordable for the average Nigerian.
Complementary Initiatives
The government’s commitment to revitalizing the agricultural sector extends beyond financial interventions. In 2024, the positive outcomes of projects funded by the International Fund for Agricultural Development (IFAD), such as the Livelihood Improvement of Family Enterprise for the Niger Delta, led to an additional grant of $32 million and an extension of the project’s timeline. These efforts are complemented by investments in modern farming equipment, with the government taking delivery of 2,000 tractors from Belarus to be distributed to farmers.
Anticipated Outcomes
The infusion of N1.5 trillion into the BOA is expected to yield several positive outcomes:
- Increased Agricultural Productivity: With better access to financing, farmers can invest in quality seeds, fertilizers, and modern equipment, leading to higher yields.
- Employment Generation: An invigorated agricultural sector can create job opportunities, reducing unemployment rates, especially in rural areas.
- Economic Diversification: Strengthening agriculture contributes to diversifying Nigeria’s economy, reducing over-reliance on oil revenues.
- Enhanced Food Security: A boost in food production ensures a stable food supply, mitigating hunger and malnutrition.
Conclusion
The Nigerian government’s decision to recapitalize the Bank of Agriculture with N1.5 trillion underscores a robust commitment to transforming the agricultural landscape. By empowering smallholder farmers and implementing supportive policies, Nigeria is on a path toward sustainable food security and economic resilience.