A cursory look at the agricultural sector shows that the scheme might have had a positive impact on the sector as the sector’s aggregate output maintained an upward trajectory throughout the period under review.
An analysis of Gross Domestic Product Reports from 2015 to 2020 revealed that total output of the agricultural sector rose from N19.5tn to N37.3tn, indicating a 91.2 per cent increase.
Between 2015 and 2016, aggregate output in the sector grew from N19.5tn to N21.4tn, it rose to N23.9tn in 2017, N27.4tn in 2018 and N31.8tn in 2019.
It was observed that, within the review period, sub-activities of the agricultural sector which the ABP programme focuses on such as crop production and livestock also recorded increase in economic performance.
For instance, between 2017 and 2020, crop production recorded an increase of about N12.1tn, from N21.1tn in 2017 to N33.2tn while livestock output rose from N1.9tn to N2.1tn, indicating a N2bn increase.
Similarly, in the first quarter of 2021, the agriculture sector grew from 14.03 per cent to 15.14 per cent, quarter-on-quarter, with crop production being the major driver of the sector.
The National Bureau of Statistics noted, “The (agriculture) sector grew by 15.14 per cent year-on-year in nominal terms in Q1 2021, showing a decline of 7.33 percentage points from the corresponding quarter of 2020 but an increase of 1.11 percentage points when compared with the preceding quarter’s growth rate of 14.03 per cent.
“Agriculture contributed 21.42 per cent to nominal GDP in the first quarter of 2021. This figure was higher than the rates recorded for the first quarter of 2020 but lower than the fourth quarter of 2020 which recorded 20.88 per cent and 24.23 per cent respectively.”
While experts, who examined the programme and its impacts, commended the CBN for initiating the ABP, they, however, highlighted insecurity as the major factor militating against the effectiveness of the scheme.
An economist and Chief Executive Officer of SD&D Capital Investment, Gbolade Idakolo said, “The ABP programme is a commendable programme. But the end result has been rubbished by the problem of insecurity arising from the farmers-herders’ crises.
“Most of the farmlands have been overrun by herders, which has made the farmers to be unable to repay the loans acquired.
“So, that is why you see that according to the consumer price index just released, food inflation continues to rise because the farmers are not producing optimally and even those that are producing, because of insecurity they are not able to transport their products to the markets where they can be sold. This brings about scarcity which makes the cost of food to increase.”
He added that the effectiveness of the scheme was also hindered by sectionalism and unequal distribution of the loans across regions of the country
Another expert and the Managing Director, Cowry Asset Management Limited, Johnson Chukwu, shared a similar view with Idakolo, adding that without adequate security for farmers, the financing provided by the CBN through the ABP programme wouldn’t yield significant results in the agriculture sector.