By Dr. Akinwumi A. Adesina
What is needed for sustained growth and economic resurgence is to remove the structural bottlenecks that limit the productivity and the revenue earning potential of the huge non-oil sectors.
We must boost food security, reduce the price of food, and ensure greater competitiveness of the agricultural sector.
While I was Minister of Agriculture, we deployed a highly innovative mobile phone system to reach farmers with subsidized farm inputs, a program called ‘Growth Enhancement Scheme’ and the e-wallet system. To be clear, this was the first time in the world that such a system was deployed to reach farmers with subsidized farm inputs via mobile phones.
And it worked! It brought in transparency. It brought in accountability. It brought in all the major commercial banks. More importantly, it delivered impressive results and led to massive food production. It reached 15 million farmers with high quality seeds and fertilizers, right in their villages. Nigeria’s food production boomed and expanded by an additional 21 million metric tons.
The rice revolution started then, in Kebbi State and the Northwest, as we deployed innovative high-quality seeds of FARO 44 and FARO 52 rice, which we introduced to Nigeria from the Africa Rice Center.
I remember visiting the Hadejia Valley irrigation project in Jigawa State, as women farmers told me “thank you Minister, we get our seeds and fertilizers right here via our mobile phones in our village and men cannot cheat us anymore”! I was elated.
Prices of food fell, as productivity went up.
The ‘Growth Enhancement Scheme’ and the e-wallet system have been adopted in Togo, Liberia, and other African countries. Yet in Nigeria where they were developed, they are no longer being implemented.
Your Excellency, Mr. President, you will have people telling you it is the lack of rain that is leading to low food production. A little, maybe. That it is insecurity. Yes, maybe, to some extent. That it is middlemen. A little, maybe.
But, Mr. President, the main reason is that farmers no longer have access to quality improved seeds, fertilizers, and farm inputs at scale.
Farmers across the country are asking for the Federal Government to restore in their words “the popular Growth Enhancement Support Scheme and the e-Wallet system.”
The Chairman of the All Farmers Association of Nigeria (AFAN), Alhaji Farouk Mudi said in March 2020 “These initiatives (the Growth Enhancement Support Scheme and the e-Wallet System) should be restored by the Federal Government. They will boost farmers’ production, create jobs and increase internally generated revenue for the States.”
I would like to urge, Your Excellency Mr. President, please relaunch the ‘Growth Enhancement Scheme’ and the e-wallet system and put millions of farmers at the heart of agriculture — at scale. If this is done, and run well, I can assure you that you will see a dramatic turnaround in national food production.
The African Development Bank has helped to finance the revolution of wheat in Sudan, with heat tolerant varieties, by producing 65,000 metric tons of seed. To give you a sense of the magnitude of this, let me say that the largest airplane, the Airbus 380 aircraft, fully loaded with passengers, fuel, and cargo, weighs 98.4 metric tons.
So, 65,000 metric tons of heat tolerant wheat in Sudan is equivalent to 660 Airbus 380 aircrafts parked on a landing strip.
The impact was dramatic. In just two seasons, we helped Sudan to cultivate these heat tolerant wheat varieties on 317,00 hectares, which produced 1.1 million metric tons of wheat.
The Prime Minister of Sudan, Abdallah Hamdok, said with this intervention “the country moved from 25% self-sufficiency to 54% in just two seasons. Sudan expects to become a net exporter of wheat within three years.”
We also supported Ethiopia to cultivate the heat tolerant varieties on over 184,000 hectares.
Interestingly, these same heat tolerant varieties were introduced to Nigeria when I was Minister of Agriculture and we worked hard to give them to farmers in the Lake Chad Basin.
You may wish to know that during the insecurity in the area, my staff at the time, led by Dr. Oluwasina Olabanji, the then Executive Director of the Lake Chad Research Institute, and his team, stayed in the fields, protected the seeds being multiplied, and risked their lives. When insecurity became much more serious, they moved the varieties to Kadawa valley in Kano.
Dr. Olabanji deserves a national award.
I was on the farms in Kano with several Seriki Nomas or farmer heads. They could not believe that wheat could be as tall as they were! These varieties yield 5 tons per hectare compared to average yield of 1.5 tons per hectare – a 400% increase!
Nigeria should take advantage of the work of the Bank on this and scale up cultivation of heat tolerant wheat across northern Nigeria.
Your Excellency, Mr. President,
It is time to also take bold policy measures to drive the structural transformation of agriculture, with infrastructure and spatial economic policies.
The key for this is the development of Special Agro-industrial Processing Zones (SAPZs) across the country. These will be zones enabled with infrastructure and logistics, to support private sector food and agriculture companies to locate close to the areas of production, and to process and add value to food and agricultural commodities.
The African Development Bank and its partners have already mobilized $520 million towards the program.
We are working closely with the Federal Government, seven State Governments, the Federal Capital Territory, the Ministries of Finance, Agriculture, Trade, Industry and Investment, Water Resources, and the Nigerian Sovereign Investment Authority (NSIA) on the design of these Special Agro-industrial Processing Zones. They are expected to create at least 1.5 million jobs.
Here is the lesson: Nigeria should establish Special Agro-industrial Processing Zones all across the country. The e-Wallet System and Growth Enhancement Scheme, to boost farmers access to productivity enhancing farm inputs should be reinstated and enshrined in law. Policy reversals should be avoided.
We must unleash the potential of the youth of Nigeria. Today, over 75% of the population is under the age of 35. More decisive actions are needed to turn this demographic asset into an economic dividend. A young, productive, youthful population, with access to education, skills, social protection, affordable housing, and medical care, will power Nigeria’s economy, now and well into the future.
We must move away from so-called ‘youth empowerment programs.’ The youth do not need handouts. They need investments.
That is why the African Development Bank is currently working with Central Banks and countries to design and support the establishment of Youth entrepreneurship investment banks. These will be new financial institutions, run by young, professional, and highly competent financial experts and bankers, to develop and deploy new financial products and services for businesses and ventures of young people. Several African countries have already indicated their readiness to establish Youth Entrepreneurship Investment Banks.
Here is the lesson: Nigeria should make its youth the drivers of the new economy through the creation of Youth Entrepreneurship Investment Banks, that put new financial ecosystems around them to fully unleash their potential.
One of the industries that will dominate the future is the FinTech industry. By 2030, 650 million Africans will have smart phones, and 50 million will have 5G phone networks. Digital payments, mobile money accounts, savings, credit, and money transfers will revolutionize businesses.
Nigeria’s FinTech is surging as one the leaders in Africa today. Google recently announced plans to invest $1 billion in Africa. That tells you something: they see the demographic and mobile tech growth and how this will rapidly change the future of e-commerce, trade, health, and finance.
Your Excellency, Mr. President,
The African Development Bank will support the Federal Government efforts, being led by Vice President Osinbajo, on the Digital Nigeria. The Bank is preparing investment in Digital and Creative Enterprises (I-DICE) program, a $600 million investment to be co-financed with several partners, which will promote entrepreneurship and innovation in the digital technology and creative industries.
Here is the lesson: Nigeria should take the FinTech industry as a major driver of the economy and invest heavily in digital infrastructure.
An economically resurgent Nigeria must be a more peaceful and secure Nigeria. Today, more than ever, several African countries are spending a significant share of their budgets on security, displacing the resources needed for development.
Increasingly, the investible space in many parts of Africa, including Nigeria, is shrinking due to insecurity and insurgencies.
Yet, resources are not there to enable countries to cope with these rising challenges. We must recognize the strong linkages between security, investment, growth, and development.
That is why the African Development Bank is working on developing Security-Indexed Investment Bonds to help African countries and Regional Economic Communities to mobilize resources to tackle these challenges.
The Security-Indexed Investment Bonds will raise funds on the global capital markets to support countries to upgrade their security architecture, rebuild damaged infrastructure in conflict-affected areas, rebuild social infrastructure and protect zones where there are strategic investments.
Here is the lesson: without security there cannot be investment, without investment there cannot be growth, and without growth there cannot be development. The African Development Bank stands ready to help Nigeria in the design and implementation of Security-Indexed Investment Bonds to raise more resources to tackle its security challenges.
Excerpt from a speech by Dr Adesina, President of the African Development Bank Group, at the Mid-Term Ministerial Performance Review Retreat, in Abuja