Flood threatens N1.9tn CBN agric schemes, losses mount


Minister of Agriculture and Rural Development, Mohammed AbubakarThe devastation caused by floods on hundreds of thousands of hectares of farmlands across the country currently poses a threat to the various agricultural schemes of the Central Bank of Nigeria worth over N1.874tn.

Farmers have also expressed fears regarding the repayment of about N1.4tn loans obtained from CBN under the schemes being implemented by the bank.

The widespread floods ravaged and destroyed multi-billion dollar farmlands covering a space of about 569,251 hectares of land, as crop cultivation has been put on hold on many of the affected farms.

The Minister of Humanitarian Affairs, Disaster Management and Social Development, Sadiya Farouq, had revealed on Tuesday that over 569,000 hectares of farmlands had been destroyed by floods.

“176,852 hectares of farmlands were partially damaged, while 392,399 hectares of farmlands have been totally damaged,” Farouq had stated.

Confirming this on Thursday, the President, All Farmers Association of Nigeria, Kabir Ibrahim, said the 2022 floods had thrown thousands of farmers into confusion, stressing that the loans from CBN would definitely take the hit in terms of repayments.

“This year, because of the flooding of farmlands, so many farmers have lost the entire plantation that they cultivated. Jigawa State is a typical example. Most of the rice farms there were completely lost and this is the situation in many other states,” Ibrahim stated.

He added, “Now tell me, would it be easy for these farmers to repay the loans? However, the loans to farmers should not just be for one season, there should be moratorium.

“For the loans to be effective, it should be within two harvest seasons, not just one, because it would not be that simple to pay back, except if you’re talking about livestock farming.

“So, the flood this year is basically the bane for no-repayment, even for those farmers who are not habitual defaulters. This flooding is almost all over.”

Documents obtained from CBN on Thursday showed that over N1tn had been disbursed as loans to farmers under the bank’s Anchor Borrowers Programme, while officials of the institution stated that about N400bn had so far been repaid.

This leaves an outstanding payment of about N600bn by farmers who benefitted from the ABP.

Also, under the bank’s Commercial Agriculture Credit Scheme, a total disbursement of about N744.32bn had been made for 678 projects in agro-production and agro-processing. The amount so far repaid under the CACS could not be provided as at press time by CBN officials.

In July this year, it was reported that the Agricultural Credit Guarantee Scheme Fund, which is managed by CBN, had guaranteed 1.23 million loans given to farmers across the country.

The monetary value of the loans was estimated at N130.903bn. The Chairman, ACGSF, Stephen Okon, had said, “A total of 1,232,326 loans valued at N130.903bn were guaranteed from inception to May 2022 out of which 973,646 beneficiaries had repaid a total of N98.91bn.”

This implies that about N32bn had not been repaid by about 258,680 farmers under the ACGSF as at May this year.

A combination of the value of the various schemes indicated that the apex bank had invested about N1.874tn on the ABP, ACGSF and CACS.

Also, the summation of the outstanding repayments for ABP, ACGSF and the total disbursements for CACS indicated that about N1.4tn was still being owed by farmers across the country.

When asked to comment on the repayments by farmers, considering their fears about the devastation caused by flood, the spokesperson of CBN, Osita Nwanisobi, declined to speak.

He, however, stated that the bank’s governor had recently made comments on loan repayments by farmers.

“We’ve had events where the governor talked about this issue of repayments. Also, some of our directors have spoken about it too, so what else should I say?” he stated.

On September 28, 2022, The PUNCH reported that the Director of Development Finance, CBN, Dr Yusuf Yila, confirmed that N1tn had been disbursed under the Anchor Borrowers Programme, while N400bn had been recovered.

He warned debtors to repay as the bank had collaborated with the Economic and Financial Crimes Commission to set up a desk with a view to recovering the loans.

“Any person who borrowed from us will pay back. We have recovered from states and we debit their FAAC. Every single loan taken from our development finance will be returned,” Yila had stated.

Meanwhile, an official at the bank said the CBN was aware of the impact of floods and the devastation it caused on farmlands, noting that the bank was optimistic that beneficiaries of loans would repay.

“We are aware of the devastation across farmlands in Nigeria by the flood, but we hope that it would not halt the repayments of loans by these beneficiaries,” the source, who pleaded not to be named due to lack of authorisation, stated.

Also speaking on the issue, the National Public Relations Officer, National Wheat Farmers, Processors and Marketers Association of Nigeria, Tola Ogunnubi, said the floods affected warehouses where wheat produce was stored.

“The issue we had was the flooding of our warehouses where we stored some of the harvested produce,” he stated.

He, however, noted that wheat was not being cultivated currently, and as such wheat farmlands could not be said to be submerged.

Ogunnubi said, “Wheat is a seasonal crop and it is planted during the harmattan season. So, the floods did not affect wheat plantation because we are not in the cultivation period.

“We farm wheat from November and harvest in March, or at most in April. However, we still have pockets of flooding on our farmlands.”

FG calls for assistance

Meanwhile, the Federal Government, on Thursday, called on Nigerians to come to the aid of victims of recent flooding in the country.

The Director General of the National Orientation Agency, Garba Abari, who made the appeal, said the victims were in dire situation which the government alone could not handle.

Reports by NEMA indicate that over 600 lives have been lost; over 2,400 persons injured; and about 1,302,589 persons displaced.

Previous Article

Alleged N1.3bn scam: Ex-naval chief absconds, abandons trial

Next Article

NIMC gets presidential approval to replace weak infrastructure

You may also like

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.