In a bid to improve agricultural productivity and production, Nigeria’s Ministry of Agriculture and the Bank of Agriculture (BOA) have signed a N3.5 billion ($22 million) financing pact to procure 400 tractors for farmers under a Public Private Partnership (PPP) arrangement.
The Memorandum of Understanding (MoU) which forms the basis for establishing Agricultural Equipment Hiring Enterprise, was signed by the country’s agriculture Minister, Akinwumi Adeshina and the Managing Director of BoA, Dr Mohammed Santuraki with other dignitaries as eyewitness.
The new tractors which will be supplied to some 60 centres across the country will help reduce stress associated with manual farming methods so as to attract the youth back agriculture and upscale food production in the country.
Speaking at the signing of the deal in Abuja, Adeshina said, “The MoU will form the basis for establishing Agricultural Equipment Hiring Enterprises to be equipped with 400 units of tractors that all help to put up an additional 152,000 hectares of land under cultivation, expected to add 760,000 tons of food to our national output per annum. The financing will be done through public private Partnership (PPP) as BOA has undertaken to finance the interested Service provider operators”
“The Ministry will provide adequate fund towards facilitating the financing of the enterprise, in partnership with the BOA and the private sector. In the refinancing window for the service providers operators, the Government is providing 35 per cent of the loans; BOA, 35 per cent; tractors vendors. 10 per cent; Service providers operators 20 per cent as equity for the take-off of the scheme ‘s hiring centres.”
On his part, the BoA boss affirmed that the financing would be done through Public Private Partnership as BoA had undertaken to finance the interested service providers operators.
He stated that the directive by President Goodluck Jonathan that the bank be recapitalised to the tune of N15 billion ($95 million) would help “refocus the institution on its core mandate of agriculture and rural financing.”
BOA is also finalising plans for another sum of N2 billion ($12.6 million) to finance youth and women in agriculture programme aimed at attracting them back to agriculture.
Santuraki also said that the bank has reviewed its operating model to conform with international best practices of successful agricultural development, modernised the institution and retrained the staff to create a more sustainable and impactful institution.
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