ABUJA – The Managing Director, Maslaha Seeds Ltd, Mr Ibrahim Abdullahi, has appealed to the Federal Government to facilitate long term loans for seed companies and farmers to boost agricultural development.
Abdullahi told the News Agency of Nigeria (NAN) on Tuesday in Abuja that the major problem affecting the production, distribution and marketing of seed was finance.
According to him, commercial banks in the country are always shying away from funding the agriculture sector.
“They say it is a high risk area fully dependent on weather and that there is no certainty, and as such, they are shying away from financing agriculture.
“But since the commencement of Growth Enhancement Scheme (GES) by the Federal Government, short term financing is no longer a problem for the agriculture sector.
“Government has through the Nigerian Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL) provided a short time loan to the sector,” he said.
He explained that they have gotten over 2,000 per cent increase in access to short term financing through NIRSAL but that was not enough, considering infrastructure challenge facing the sector.
Abdullahi, an agricultural seed developer, urged relevant bodies to assist in the development of the seed sector in the country.
The managing director also said that the sector was confronted by inadequate human capacity in scientific research and development of seeds.
He noted that the existing research institutes in the country were doing little in the area of seed development because of inadequate funding.
Abdullahi, however, noted that the situation was gradually changing with the agricultural transformation programme of the Federal Government coming on board.
“Government said it would provide guarantees for commercial banks to fund seed production in Nigeria. [eap_ad_1] “Under this arrangement, the government provides 75 per cent guaranty, the seed companies will provide 10 per cent equity contribution and 20 per cent insurance guaranty, so banks are 105 per cent secured.
“But the area we want government to really come in now is that most of the financing we get from banks now are short term; between six and 12 months tenure.
“This is not enough as far as the development of seed industry is concerned in Nigeria, long term funding is needed to supplement,” he said.
Abdullahi said the transformation agenda of the federal government is visible in the welfare of farmers, the seed sub-sector, fertiliser distribution and the agro business in the country.
“For example before now, there were only five active seed companies in the country and all these companies put together were not producing more than 5,000 metric tonnes.
“But now, we are producing more than 150,000 metric tonnes.
“Our main concern now is how to distribute the seeds to the farmers, because farmers are located in the most remote areas and you won’t be able to reach them. (NAN)
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