Strengthening Private Sector’s Role in Nutrition: Key Policy Reforms and Stakeholder Action Needed

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In a landmark gathering held on 31 October 2024, at the Abuja Continental Hotel, experts and stakeholders from various sectors came together for the National Policy Dialogue for Food and Nutrition-Focused Businesses.

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With the theme “Catalyzing Policy Reforms for Regulatory Compliance and Finance Access: Enhancing Private Sector Impact on Nutrition,” the event drew attention to critical challenges and actionable solutions to foster a more supportive environment for Micro, Small and Medium Enterprises (MSMEs) in the agri-food sector.

The dialogue, attended by 84 participants, 33 of whom joined virtually, featured high-level contributions from various stakeholders, including government representatives, private sector leaders, development partners and civil society organizations. The Senior Adviser to the President on Agribusiness and Productivity, Kingsley Uzoma, delivered a keynote address, emphasising the need for robust policy reforms to unlock the potential of MSMEs in improving the nation’s food security and nutrition.

Challenges Facing Nutrition-Focused MSMEs

There are several roadblocks hindering the growth of MSMEs in the nutrition-focused business space. A primary concern is the complex and overlapping regulatory framework, particularly between agencies like NAFDAC (National Agency for Food and Drug Administration and Control) and SON (Standards Organisation of Nigeria). Business owners highlighted the high costs of regulatory compliance, which limit market access, especially for small businesses that already struggle with inflation, inter-state fees and rising operational costs.

Furthermore, limited access to financing and a general lack of awareness regarding available tax incentives and funding opportunities are serious barriers. Add to this the challenges of poor financial literacy, outdated technology and insufficient strategic planning and it becomes clear why many MSMEs find it difficult to scale or even survive in such an unpredictable landscape.

Actionable Recommendations: A Path Forward

To address these challenges and improve the enabling environment for MSMEs, the dialogue culminated in several concrete resolutions and recommendations.
These included:

1. Simplified and Streamlined Regulatory Processes: Participants called for the establishment of a central database to harmonise and streamline the regulatory processes across different agencies. This would reduce the bureaucratic red tape that often frustrates businesses trying to comply with multiple regulations.

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2. Enhanced Media and Platform Engagement: The creation of dedicated food and nutrition platforms and increasing media engagement were highlighted as key strategies to promote investment opportunities and to keep stakeholders informed about tax, financing options and the evolving regulatory landscape.

3. Investment Incentives: To encourage investment in research, development and MSMEs, stakeholders advocated for the introduction of corporate investment models and targeted incentives. This could include tax exemptions for businesses and financial institutions investing in nutrition-focused MSMEs.

4. Financial and Credit Solutions: Recommendations included the introduction of cluster financing, where banks fund farmer associations or cooperatives, reducing individual financial risks. Additionally, MSMEs would benefit from revenue-based repayment options, subsidised interest rates and alternative financing models such as Islamic banking.

5. Flexible Financial Support: The dialogue proposed introducing more flexible repayment terms for MSMEs, including options tailored to their revenue cycles. This would help alleviate the financial pressures many businesses face, especially during the early stages of growth.

6. Agricultural Attractiveness: Participants also suggested strategies to make agriculture more attractive to investors. Programmes like NIRSAL, which offer guarantees on loan defaults, alongside tax incentives, were cited as potential models to encourage investment in this critical sector.

7. Holistic Approach to Nutrition: A more inclusive approach to nutrition was another key resolution. This would ensure policies that address not only undernutrition but also overnutrition and micronutrient deficiencies, providing a comprehensive strategy to tackle the nation’s nutrition challenges.

A Call for Stakeholder Action

The recommendations from the National Policy Dialogue are more than just words on paper; they represent a clear call to action for all stakeholders involved in the food and nutrition value chain.

The government, in particular, has a crucial role to play in implementing these policy reforms. Key government bodies, including the Ministry of Health and the Federal Ministry of Agriculture and Food Security, were urged to commit to ongoing policy reviews and to ensure that NFBs (nutrition-focused businesses) are better represented and supported in government food programmes.

The private sector too, has a significant responsibility to foster innovation, invest in research and development and collaborate with MSMEs to help them access new markets and funding opportunities. Financial institutions can play a pivotal role in improving access to credit by offering tailored financial products and flexible repayment terms.

Commitment to Progress

In addition to the policy recommendations, several key organisations have made commitment statements to support the growth of MSMEs. Ikore International Development, for example, in the course of our recent policy dialogue. pledged to design tailored training programmes and conduct surveys to better understand the needs of MSMEs.

The agrifood resource centre, managed by Ikore and Halel Integrated Services Limited, will work to facilitate access to crucial information and resources that will enable businesses to grow and remain compliant with industry standards.
Furthermore, the Ministry of Agriculture & Food Security and the Federal Ministry of Health and Social Welfare committed to reviewing policies to enhance the operating environment and support NFBs, while also recognising their role in tackling the nation’s nutrition challenges.

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A Collaborative Approach to Nutrition

In the final analysis, we believe that with a shared understanding, the challenges faced by nutrition-focused businesses can only be overcome through collaboration. Government action, private sector investment and a commitment to creating a more supportive environment for MSMEs, are essential for catalysing the necessary policy reforms.

As the nation seeks to address its nutrition challenges, the private sector’s role in providing safe, nutritious foods will remain paramount. However, without the right policies, regulatory support, and access to finance, these businesses will continue to struggle. Now is the time for stakeholders to come together, act decisively and ensure that these recommendations translate into real change for Nigeria’s food and nutrition future.