Federal Government to Conclude Bank of Agriculture Recapitalisation by Q1 2025

Awaits $4.5bn Green Imperative Funds

 

The Federal Government has announced plans to complete the recapitalisation of the Bank of Agriculture (BoA) by the end of the first quarter of 2025. This move is part of broader efforts to improve funding for smallholder farmers and address the growing challenge of food inflation in the country.

Senator Abubakar Kyari, the Minister of Agriculture and Food Security, revealed this during a ministerial briefing at the Presidential Villa, Abuja, on Tuesday. The long-anticipated recapitalisation is seen as a crucial step to address the agriculture sector’s chronic underfunding.

Addressing Agriculture’s Funding Gap

Data indicates that, between 2014 and 2021, the highest commercial bank loans to the agriculture sector amounted to ₦1.04 trillion in 2020, which represented just 5.15% of total commercial bank loans over the seven-year period. This highlights the significant funding gap that has hindered the sector’s growth.

Kyari emphasized that the recapitalisation of the BoA would be concluded by the end of Q1 2025, noting that the bank’s network of 109 branches across the country would play a pivotal role in boosting agricultural financing.

Key Role of the National Council of Privatisation

In 2024, Vice President Kashim Shettima, who chairs the National Council of Privatisation (NCP), inaugurated a committee led by Finance Minister Wale Edu. The committee’s task is to develop a roadmap for the revitalisation of the Bank of Agriculture, aligning with the government’s broader strategy to tackle food insecurity and provide more substantial support to farmers.

Kyari explained that the recapitalisation would enable farmers to access the financing necessary to expand their businesses, particularly as loans from conventional commercial banks have been inadequate in recent times.

Boosting Agricultural Output

The Minister also highlighted positive developments in agricultural output, stating that Nigeria’s 2024 farming season delivered harvests that “far exceeded what we had in previous years.” This is seen as a positive sign of the potential benefits that increased funding and support could bring to the sector.

Green Imperative Programme and Modernisation

As part of its efforts to modernise agriculture, the government is also awaiting $4.5 billion in funding from the Green Imperative Programme. This initiative is designed to support the mechanisation of farming and improve overall agricultural practices in the country.

Kyari also confirmed the arrival of 200 tractors in Nigeria, marking a significant step in the government’s push to modernise farming and improve productivity. The Green Imperative Programme, alongside the recapitalisation of the BoA, is expected to play a crucial role in enhancing the sustainability and growth of Nigeria’s agricultural sector.