Nigeria’s government believes foreigners are taking over agribusiness in the country.

And they blame this on high interest rates being charged by Nigerian banks.

It appears this is dawning on the government after they realized that the production and sale of crude oil could not salvage the country’s fragile economy.

Indeed, revenue generation from oil is too low when compared to what some smaller countries make from export of agricultural commodities.

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It was the Minister of State for Agriculture and Rural Development, Senator Heineken Lokpobiri, who was raising alarm on this trend when he spoke on the sidelines of a seminar organised in Abuja by the Danish Embassy in Nigeria on value development in the country’s food and agriculture sector.

farmland

Lokpobiri insisted that the major challenge inhibiting the desired development of the country’s agricultural sector was poor access to finance.

“The major challenge bedeviling this industry is access to finance. Agricultural financing in Nigeria is too costly; for even at 9% you can’t find it. They will ask you for all forms of collateral, the CBN will say bring your father’s house, bring this, bring that.

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“But if you have a company that is ready to support agro investors, then people will invest. If you have access to cheap funds, you will be able to invest on a long-term basis. Instead of getting a loan from a commercial bank at 25 to 30%, you can have it at 2% and pay back in about 30 years. Here, you don’t have such funding. That is what we are talking about,” he said.

He added: “And that is why if you look at it now, foreigners are taking over the agro sector here; either from India, they get it (loan) at three or four per cent, or from Europe at two or three per cent. But here, it is 30% and they (banks) are not even willing to give. The only way you can compete with others is for you to have cheap funds that will reduce your production costs.”

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