Appointed as Minister of Agriculture 11months ago, Professor Sheikh Abdullah, in this interview with Sunday Vanguard’s Jide Ajani, Editor, Northern Operations; Favour Nnabugwu and Gbemiga Olamikan, presents government’s position on the huge challenges in a sector that employs 70 per cent of Nigerians. Abdullah laments that some states are still not meeting their obligations to farmers but reaches a point of consolation that things would get better.
He speaks about the commitment of President Goodluck Jonathan and the new policy being put in place to ensure that the benefits of subsidy on fertiliser really get to the farmers.
What is your assessment of agriculture in Nigeria?
The first thing we will talk about is the issue of coordinating or harmonising and sustaining policies. By this, I mean there are no separate departures in policy framework. Most analyses of policy environment in the country have some common phrases like “policy inconsistency, policy sommersault.” These are very strong negative assessments that informed my management of agricultural policy in the country. Attempts have been made to consolidate for the betterment of harmonising existing policy for their sustenance.
There are differences between tactics and policy. Policy has to go through instrumentation in terms of a gestation period for assessment but tactics can be instantaneous because it tends to measure the immediate action. Since my assumption of office, we have reduced the undulating things of agricultural policy.
Much of what we pursue we find them to be an elongation of what exists. This administration that is about to end is a continuation because we have a moment of re-assessment. It is a continuity of Yar’Adua’s administration but the policies we are getting right so that at the end of the day we can appropriately feed our people. This administration is very committed to ensuring that there is abundant food for all.
Most of what you said appear esoteric, but how come this nation cannot feed its people?
Self-sufficiency is a goal and the thing about a goal is that when it is not achieved we will be searching first to achieve it. We, as a nation, are not food sufficient but that does not mean we cannot be. Giving what we have in our environment in terms of natural endowment, even the peace that we enjoy in this country is enough to say we have what it takes to be self-sufficient in food production. And, if we are so endowed, it becomes an aberration for us not being able to feed ourselves. But we will get there.
What are the challenges of food sufficiency?
We should ordinarily have the capacity to grow what we want and the capacity to sell what we grow. The first challenge is the idea of getting appropriate balance in terms of diversification. Even the oil which is an endowment to us gives an illusion that the answer to this country is in the oil and leaving the other endowments like agriculture unattended to. Inadequate diversification is a challenge but when you take each one of them, l think agriculture has a place there but not without its challenges.
One of the first challenges is that there is under-investment in agriculture. The under-investment in agriculture has to do with investment in terms of input, advanced technology and tractors, for instance. There are yardsticks for measuring the intensity of mechanisation.
Usually, for tractor density in Nigeria, we are talking of about .3hp/h while the FAO and others are recommending the minimum of 1.5hp/h. This means doing less than 20 per cent of our level of technological input to agriculture. And, the issue of unlocking the necessary fund availability within which funds can be made available to agriculture remains another very serious challenge.
Then, there is the level of intermediation, which is continuously arrogant to agricultural sector. If we have to judge agriculture by the normally prudent measures on return on investment, agriculture is the least attractive because of the size of the return on investment which is usually lower and which takes a longer time; but funds move faster to other areas with good return on investment.
However, looking at the contribution of agriculture to the GDP, it is about 40 per cent. The funds available to agriculture are not sufficient because the financial institutions are not adequately attuned to the challenges of agriculture.
In terms of agricultural investment, technology, development of agro processing, value chain development, development of the capacity of small-holder farmers and in terms of development of utilisation of extension services and opening up of various markets are all challenges.
What policy has government put in place to whittle down the effect of those challenges?
First, I will explain the dichotomy between short-term and long-term investments; never mistake one for the other. It is stupid to take an overdraft to marry because overdraft is a short-term expectation and marriage is a long-term expectation.
There has to be a balance in policies. What the government is dong is to take a long range view. For instance, a number of issues have to be looked into, say, how do we control our production or how do we elongate the chain of production? We can have processing industries that would further elongate the value chain. Government recognises the value chain of distribution and a good number of issues are considered like the construction of silos, industrial outlays, and agro-processing outlays. The issue of fund and aquaculture – it is a shame for the country to really think of importing fish. Government takes note of the short-term perspective with a caveat.
How many silos do we have at present?
First, let me make it clear that a silo is a reserved storage for food. It is to keep what you have harvested for a rainy day. One of the powers of a silo is to elongate life. The intention of this administration is to have the silos in all the states of the country. There is nowhere is this country that we do not grow one thing or the other, hence we need storage.
The concept of silos is to reduce losses such as tomatoes which losses can go up to 70 per cent if not managed. There are various ranges and capacity; the minimum in the level of federal capacity is 25 metric tons and that costs a little than N2 billion and the highest is 100-metric tons which is close to N5 billion. We have the 100-meter metric tons in Kebbi and we’ll be commissioning a 25-meter metric ton silo in Kaduna soon.
What is the present capacity and what are we aiming at?
In Nigeria we should be talking about 1.3 million metric tons and we should be aiming at three millon metric tons.
Why is agriculture reduced to fertiliser distribution?
If there is anything called centre of gravity for the ministry, I will say it is fertiliser gravity because of its importance. One of the problems is under-investment in it and the centre of gravity is determined by force. Fertiliser is also very important in terms of the requirement by all and the demand for it. For the first time, we had envisaged a procurement of 900 metric tons, the highest ever done by the country.
At what cost was that?
The total figure is about N89 billion. It is easier for people to say government spent N89bn, but what ought to be stated is that Nigeria is procuring N89bn worth of fertiliser. What the country may be purchasing may be more because of private arrangements but the other caution is that it is only a component of this that is Federal Government-based.
Government is spending N89bn on fertiliser with a subsidy of 25 per cent. The 25 per cent of N89bn is N22.3bn which is what the Federal Government is contributing. What the states are expected to contribute is 15 per cent of that value and when you take 15 per cent which is N14bn, when you add the Federal Government and the states subsidies together, that gives about N36bn subsidy on fertiliser.
But, then, there is the issue of diversion of fertiliser; what are you doing about it?
A problem that is much-talked about is the issue of diversion which is in several forms. First, diversion through leakage, a situation where seven bags is given instead of 10 bags. Again, diversion in the area of quality and in order to check this we will improve on surveillance, instituting monitoring mechanism whereby what is being supplied is tested before being accepted via the states for which the fertilisers were procured. The ministry also has to ascertain what is being delivered and marry them with what the states claimed are delivered.
These are things that we have put in place.
What about the voucher system?
That is a new policy being introduced by the administration of President Goodluck Jonathan. It is about ensuring food for all and it is about getting the real benefits of the fertiliser distribution to those who need it.
The voucher system is a new policy and we are working within the next procurement to actualise the use of the voucher system.
One big advantage of the voucher system is the fact that the incidence of subsidy is instantaneously delivered to the beneficiaries against the ambushing of subsidy.
One way to do that is to change the trajectory such that the farmer gets the immediate subsidy and it also comes with simultaneity of the redemption of the voucher which is crucial to the ministry.
There are discomforts that some states are not meeting up with their obligation. And, we want to improve upon the nicety of the environment for the kind of system to survive.
What is the ministry doing to ensure farmers access the N200bn facility for them?
The fund is N200bn but the draw down is certainly over N150bn. The fund is largely managed by the financial institutions and the submission of the Central Bank of Nigeria recently indicated that over N150bn had already been dispersed.
The delay in accessing the funds by the states is as a result of the unwillingness on the part of states to issue the irrevocable payment order. Their delaying of the irrevocable order means that the fund can be easily taken over. I think less than half of the states of the federation have accessed the fund. The other reason for delay in accessing the fund is the disfavour in the immediate of the financial system to agriculture. The disfavour is arrogance in terms of their requirement. When you ask for collateral that is unreasonably vague and unreasonably irrelevant, it is a disincentive.
A farmer based in the village who does not have access to land is being requested to present a land document in Abuja. Those requirements are a source of discouragement and delay to accessing the fund. What is important is the need for the financial system to transform and take agriculture as a partner and as necessary investment. There must be a necessary portfolio.
What is the ministry doing to cushion the pre and post-harvest losses?
The ministry does what l call proactive measures in terms of the birds. A number of flight hours have always been allocated annually to deal with those birds. There were few challenges in the season that just ended and they have been adequately taken care of. That pre-harvest challenge in terms of production is a very big challenge.
How would you give Nigerians hope regarding food security?
First is to tell Nigerians that we have no alternative. Agriculture is the most viable option for us in this country but we cannot love agriculture if the environment is not conducive for us. There is an inverted pyramid where the older people are farming for the younger ones to feed and inverted pyramid cannot stand.
It is the younger people that should go on farming for the older ones to feed. For the young ones to take to farming, there must be encouragement in terms of providing the facilities for them to operate. The message is for us to love agriculture and we must collectively accept new technology. It must be understood that the aging farmers cannot sustain this country unless we take the active age group.
Then, once the voucher system is introduced by this government, it would go a long way to ensure food for all because it would save the farmers a lot of stress.