Abuja - The Federal Executive Council (FEC) on Wednesday approved the procurement of $152-million loan (about N35.9 billion) and $385 000 grant (about N64.5 million) for agricultural development.
The Minister of Agriculture and Rural Development, Dr Akinwumi Adesina, made this known after the council meeting presided over by President Goodluck Jonathan at the State House.
Adesina said that the facilities to be obtained from the African Development Bank (AfDB) would be used to develop 14 Staple Crops Processing Zones in seven states and 27 local government areas.
According to him, the loan to support agricultural production and investments, will attract 1.5 percent interest and be repaid over 22 years.
Specifically, Adesina said that the fund would be used to develop infrastructure in the 14 Staple Crops Processing Zones in order to attract foreign investors in the food processing sector.
He explained that a Staple Crop Processing Zone is an area of high production where the government would provide the enabling environment to attract private sector food processing companies.
"It is a big game changer for agriculture and the AfDB and the World Bank are so excited about it that they have asked other african countries to copy Nigeria."
Adesina noted that infrastructure was very important in attracting private sector investments.
"They need power, water, roads and rail for transportation and you cannot invest that everywhere because it is expensive to do.
The minister said that the loan would be specifically used to develop rice, sorghum and cassava in commercial production and also to support private sector processing and value addition for the commodities.
Adesina said that the zones would be located in Adani-Omo in Ebonyi and Enugu States for rice and cassava; Bida and Badeggi for rice; Kano and Jigawa for rice, tomato and sorghum; Kebbi and Sokoto for rice and Sorghum.
According to him, the zones will generate 120 000 jobs of which 36 000 will be women.
He said the programme will allow the addition of 20 million tonnes of rice, cassava and sorghum into domestic food supply.
He added that access to insurance by farmers in the seven states would increase from nine percent to 80 percent while the numbers of farmers organisations obtaining loans from banks and other micro finance institutions would jump from 22 percent to 80 percent.
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