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FG secures $74 million loan to boost agriculture

Channels Television  
Updated August 24, 2012

The Federal Government has signed a $74 million loan with the International Fund for Agricultural Development (IFAD) to boost cassava and rice production in the country.

President of the organization, Dr. Kanayo Nwanze said that the programme is expected to improve the value chain of rice and cassava production in six states of the federation targeted at reducing unemployment and improving household income, at the signing ceremony in Abuja,.

Present at the  ceremony were the Minister of Finance, Dr. Ngozi Okonjo-Iweala and her counterpart from the Ministry of Agriculture, Dr. Akinwunmi Adeshina.

The Minister of Finance, Dr Ngozi Okonjo-Iweala stated that the federal, state and local government will provide a counterpart fund of $31 million to be paid for a period of six years.

Okonjo-Iweala said the IFAD credit would be beneficial to the country as it would help create jobs and help the country to be self-sufficient in food production.

She said the agreement comprised an IFAD credit of $74m, which would attract zero interest rate and a repayment period of 40 years, as well as a grant of $0.5m.

The minister explained that the credit was on soft terms, adding that the three tiers of government would provide counterpart contribution to the tune of $31.2m.

Okonjo-Iweala said, “We are signing this credit to underscore the importance of IFAD’s commitment to the development of agriculture in this country, and it also demonstrates that our relationship with IFAD is yielding benefits to this country.

“The IFAD partnership development programme, which is what we are kicking off today, is valued at $105.2m and comprises of an IFAD credit of $74m and a grant of $0.5m.”

She added, “The credit is on soft terms and the Federal Government, states and local councils will provide counterpart contribution to the tune of $31.2m. This project will be implemented over a period of six years and there is no doubt that it will be a strong contributor to the very important plan for the agriculture sector.

“The IFAD credit is one of the most beneficial because there is no interest, only 0.75 per cent commitment charge and 40 years’ repayment period; and so, it is really a very great credit for the country to access.”

Also speaking at the event, Adesina said the funding would be used to boost rice and cassava production in six states.

The project, he noted, would cover 40,000 households in Anambra, Ebonyi, Ogun, Niger, Benue and Taraba states.

“IFAD is working very closely with us and they are supporting us in rice and cassava production. The programme will target 40,000 households in six states and it will help us to strengthen the agriculture value chain, improve market infrastructure, particularly feeder roads between the production centres and the markets, and enhance productivity of farmers,” he said.

Nwanze said the organisation had financed nine projects valued at $229m.

He said Nigeria was currently receiving 40 per cent of the total loans given to West and Central African countries.

“Funding for this project was approved in April this year. We have financed a total of nine projects valued at $229m, and currently, Nigeria receives about 40 per cent of total loans to West and Central Africa, comprising of 21 countries, and this shows how important Nigeria is to the continent,” Nwanze said.