Home Business FG establishes N50bn mechanisation fund for agric equipment hiring enterprises

FG establishes N50bn mechanisation fund for agric equipment hiring enterprises


ABUJA – The Federal Government has earmarked N50 billion Mechanisation Intervention Support Fund to speed up the establishment of 1,200 private sector-driven Agricultural Equipment Hiring Enterprises nationwide.

President Goodluck Jonathan made this known in Abuja on Monday while inaugurating 100,000-metric tons silo complex and the private sector-driven Agricultural Equipment Hiring Enterprises.

Represented by Vice-President Namadi Sambo, the President said his administration would also begin the provision of mechanisation support grants to farmers to enable them to access agricultural mechanisation services.

“As part of our drive to limit the use of hand hoes and cutlasses, and replace them with modern agricultural equipment, I direct the Central Bank of Nigeria to set aside the sum of N50 billion Mechanisation Intervention Fund.

“This support fund will allow and speed up the full establishment of the 1,200 private sector-driven Agricultural Equipment Hiring Enterprises across all the states of the federation.

“The Federal Government will, for the first time ever in the history of Nigeria, begin the provision of mechanisation support grants to farmers to allow them to hire agricultural mechanisation services.

“The Growth Enhancement Scheme and the e-wallet scheme of the Federal Government will be expanded to provide subsidised electronic mechanisation support vouchers to farmers, which they will use to pay the agricultural hiring enterprises to provide mechanisation services for their farms,“ he said.

According to him, as the country produces more food, it has become necessary to expand food storage capacity and reduce post-harvest losses.

He, therefore, said that the development of strategic grains reserve was central to government policy of stabilising food prices for consumers and assuring guaranteed minimum prices and market access for farmers.

The President noted that Nigeria was the first in Africa to develop the electronic wallet scheme for reaching farmers with subsidised farm inputs via mobile phones.

He also said the country was also leading in providing mechanised services support from the private sector to farmers using mobile phones.

“Today, seeds, fertiliser, tractors and agricultural equipment service provision to farmers are all linked to mobile phones,“ he stated. [eap_ad_1] Jonathan said the Federal Government, through the Federal Ministry of Agriculture and Rural Development, had provided N4.5 billion to support the provision of affordable refinancing facility to allow private sector acquisition of the facilities, through the Bank of Agriculture.

He also explained that the Nigeria’s Agricultural Equipment Enterprise model was voted as the best agricultural mechanisation programme in Africa.

The President said, “I also understand that the Agricultural Equipment Hiring Enterprise model was voted in 2013 as the best agricultural mechanisation programme in Africa by the African Rural and Agricultural Credit Association, which includes Central Bank Governors, commercial banks, agricultural banks and micro finance institutions across Africa.

“I am pleased to note that the financing arrangement requires the government to provide 35 per cent of the loans, Bank of Agriculture 35 per cent, the agro-machinery vendors to provide 10 per cent and service provider operators will provide 20 per cent equity to kick-start the Agricultural Equipment Hiring Enterprises.“

He expressed the hope that the operation of the network of grain silos in the country and the Agricultural Equipment Hiring Enterprises would go a long way in further modernising the agricultural sector.

According to the President, as the private sector-driven mechanised service providers expand over time and reach farmers across the country, they will provide a wide array of mechanised operations to farmers, and hasten the disappearance of hoes and cutlasses.

He commended the leadership and staff members of the agric ministry for making Nigerians proud.

“I urge you all to continue to innovate and drive transformative change, until we achieve our ultimate goal of making Nigeria a global powerhouse in food and agricultural production,“ he said.

In his remark, the Minister of Agriculture and Rural Development, Dr Akinwumi Adesina, said that private sector investment in the agricultural sector was growing.

Adesina who disclosed that Nigeria’s food import bill had declined from N1.1trillion in 2009 to N684 billion by Dec. 2013 through the Agricultural Transformation Agenda, said the silos would tackle food waste and post-harvest losses.

“There is no doubt that the agriculture sector is growing rapidly, private sector investment in agriculture is also expanding across our nation.

“Small holder farmers are witnessing a refreshing dawn but the challenges in the sector are the low level of mechanisation.

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