Looming food shortage alarm raised by AfDB President, Dr. Adesina Akinwuni, may worsen the current economic hardship if not swiftly tackled by government, ABDULWAHAB ISA reports
To the average Nigerian, COVID-19 is a mere smokescreen. The global disease only worsened an already deteriorating living condition experienced by most Nigerians. Prior to the pandemic, which began in late 2019 and had a severe impact in 2020 and 2021, most Nigerians’ pastime was hunger, insufficient feeding and harsh living conditions. Many people, who were previously employed, lost their jobs as a result of the pandemic. This was caused by the private sector’s measures in response to the storm. Nothing underscores the severity of economic hardship faced by average Nigerians than the sorrowful May Day message pushed out by members of organised labour on Monday, a day set aside to celebrate workers. Labour representatives painted a gloomy picture of high unemployment, galloping inflation in the economy, devaluation of naira, low wages, widespread insecurity, rising cost of living, a near-comatose education sector and a failing healthcare sector. These were, according to labour leaders’ indices, the things that have made life more gruelling for workers and ordinary Nigerians.
Untamed food inflation
Unarguably, data from the National Bureau of Statistics (NBS) is the key template for measuring the price of food items. For some obvious reasons, the consumer price index has remained on an upward trend in the past couple of years. Every food item has an upward trajectory. The increase in the price of food stuffs amid poor economic resources and an escalating poverty level exerts hardship on majority of Nigerians. The most disturbing scenario is the astronomical rise in prices of food items. For example, a food item that goes for a particular price this week can’t be procured at the same old price the week after. Experts attribute the development to sustained attacks on the farming community by herders. The development, they said, seriously disrupted all-season farming activities across most farming regions and adversely affected food production and the economy of Nigeria. The intense insecurity hovering around farms occasioned by Fulani herdersmen is dwarfing the impact of central bank’s interventions. The agricultural sector, under the watch of the current CBN Governor, Mr. Godwin Emefiele, has been a major focus of the bank’s interventions in recent times. Driven by its development finance mission, the apex bank, in addition to other windows through which it funds agriculture, launched the Anchor Borrowers’ Programme (ABP) in 2015. ABP is designed to create a linkage between anchor companies involved in processing and small-holder farmers (SHFs) of the key agricultural commodities. The thrust of ABP is the provision of farm inputs in kind and cash (for farm labour) to small-holder farmers to boost production of these commodities, stabilise input supply to agro processors and address the country’s negative balance of payments on food. At harvest, the SHF supplies his/her produce to the agro-processor (Anchor), who pays the cash equivalent to the farmer’s account. A laudable, novel idea, CBN’s ABP has been able to address substantially some bottlenecks faced by small-holder famers, save for insecurity. With ABP, the Central Bank of Nigeria disbursed N975.61 billion to farmers across the country. The amount was released to over 4.52 million smallholder farmers as of February 2022. Between January and February 2022, the bank disbursed N29.67 billion under the Anchor Borrowers’ Programme for the procurement of inputs and cultivation of maize, rice and wheat, the three crops that have hitherto being the significant concerns of FX demand. Emefiele recently, said: “These disbursements bring the total under the programme to over 4.52 million smallholder farmers, cultivating 21 commodities across the country, which comes to a total of N975.61 billion.” Of course, security is the sole responsibility of the executive, the fiscal authorities, and do not fall under the purview of monetary policy.
Impeding food shortage alarm
Still battling with an unabated food crisis and its associated challenges, Nigeria was told to prepare for a looming food crisis in the immediate future, unless drastic steps are taken. President of the African Development Bank (AfDB), Dr. Akinwuni Adesina, was on a visit to President Muhammadu Buhari, last week. The AfDB boss went to brief Mr. President on the impact of the Russian-Ukraine war and its implications for food security in Africa and Nigeria and to intimate him of the decisive actions being taken by the African Development Bank to avert what is becoming a looming food crisis. Adesina said: “Russia and Ukraine dominate the export of wheat and maize to Africa. With the disruption of supplies arising from the war, Africa now faces a shortage of at least 30 million metric tons of food imports from Russia and Ukraine, especially for wheat, maize, and soybeans.” Akinwuni didn’t stop at intimating the president about the looming food crisis in Africa and beyond, he went a step further to list some of the contingent action plans being taken by the continental banks to counter a seeming food crisis. The AfDB president pledged the bank’s commitment to support Nigeria in developing special agro-industrial processing zones. “We have helped to mobilise $540 million for the programme. The African Development Bank has approved a total of $210 million. The Islamic Development Bank and the International Fund for Agricultural Development (IFAD) have approved $170 million and $160 million, respectively, towards the programme. “The Special Agro-Industrial Processing Zones will be initially rolled out in seven states – Kano, Ogun, Oyo, Kaduna, Kwara, Imo, Cross River and the Federal Capital Territory,” he said. Save for insecurity associated with farming activities spurred by Fulani herdersmen, Nigeria, a dominant nation in Africa in the agriculture sector, would have no need to nurse food shortage fears, given the massive interventions committed into the agriculture value chain by CBN.
Experts, who spoke to New Telegraph about the persistent high cost of living and food shortages in Nigeria, offered their perspectives. Speaking on the issue, financial adviser and wealth management expert, Gabriel Idakolo, said: “Government needs to focus on developmental policies that would aid agriculture and provide self-sufficiency in fertiliser production and crude oil refining, which is a major pivot to the reduction of food inflation and other essential services in Nigeria. “Government should also develop lasting policies that can bring down the rise in the exchange rate of naira to dollar, especially because most products and services are affected by the high exchange rate of U.S. dollar.” In his view, the Managing Director of Credent Investment Managers Ltd., Mr. Ibrahim Shelleng, said: “With regard to the high food inflation, the Russian-Ukraine crisis is having a major effect on global food prices and developing countries such as Nigeria will be hardest hit. “There are essentially two solutions: one being to subsidise food (which will cost the already cash strapped government) and the second option would be to heavily invest in production, which will yield results, but with a longer timeline. “Sadly, the lack of investment in infrastructure and economic diversification over the years has made the country vulnerable to global macroeconomic shocks.” It will take a long-term approach to steer the country back on the right path.”
Guaranteeing food security is the responsibility of government. To avert looming food shortage, government must prioritise famers’ security and their unhindered access to farmlands.