APC Senator criticises Central Bank of Nigeria’s operations

Central bank of Nigeria (CBN)
Central bank of Nigeria building

The Central Bank of Nigeria (CBN) is overreaching its mandate by administering loans directly to farmers through the Anchor Borrowers Programme (ABP), a senator has said.

The situation is made worse by the failure of the CBN to play its constitutional role of recapitalising the bank of agriculture which is now virtually in distress, Abdullahi Adamu said on Saturday.

Mr Adamu, who is the Chairman of the Senate Committee on Agriculture, restated the need for the CBN to hand over the administration of the ABP and other agricultural programmes.
In an interview with the News Agency of Nigeria (NAN), in Abuja, he urged the CBN to hand over agricultural programmes to the Ministry of Agriculture and Rural Development (FMARD).

The senator said it was high time CBN allowed FMARD to carry out its mandate through the various agencies under it, adding that the mandate of the apex bank was to act as a referee or monitor financial transactions and not taking over the function of any ministry.

The former Nasarawa governor, himself a commercial farmer, said the agency of government that has the mandate for the promotion of agricultural production generally is domiciled in the Ministry of Agriculture while the Bank of Agriculture (BoA) should handle loans to farmers.

“It (BoA) is supposed to be the agency through which financing of agricultural loans and other facilities to empower farmers of various categories to benefit and get necessary funding be domiciled.

“The Bank of Agriculture is better placed like the Bank of Industry (BOI) as development banks to take responsibility in administering money from government that is aimed at promoting agricultural production in the country.

“The Central Bank has no mandate for agriculture. Where they have these funds, the best thing to do is to give it to the ministry of agriculture to manage, because some of these out-grower programmes we are talking about, their cost to the government is more than the budget of the federal ministry of agriculture itself.”

The senator emphasised that a programme like the ABP, currently domiciled in the CBN, was a mismatch, adding that it fell within the purview of the BOA.

PREMIUM TIMES reported how the CBN, through the ABP and working with farmers’ associations and state governments, gives loans to farmers with the aim of improving local production of major food items like rice and cassava. The programme has been credited for the increase in local rice production in many states.

Mr Adamu, however, argued that considering the huge expenditure of the ABP, as well as its focus, it should have been transferred to the BoA.

Distressed BoA

The senator said while there was no doubt that the BOA was in distress, rather than CBN usurping its mandate, efforts should be made at recapitalising it to be better positioned to carry out its mandate.

“The Anchor Borrowers Programme for example, if you check how much money has gone in there as from 2016, 2017 to date, you will find out that the money is over and above, about four times the budget provision for ministry of agric in its entirety.

“I believe that it is not within the mandate of the Central Bank of Nigeria as the apex and monitoring bank to get involved with loan facilities because they are the referee in financial sector.

“Now when they begin to give loans and there is default from beneficiaries of the loans, who is going to be the referee.

“The Central Bank has put itself in a very precarious situation. The same Central Bank of Nigeria as I talk to you today has not paid up its capital for recapitalising the bank of agriculture since 1974 when the agric bank was established.

“So, it is in distress, there is no doubt about it and everybody knows why it is in distress. Till this very moment, both the Ministry of Finance and the CBN have not lived up to their responsibilities of recapitalising the bank of agriculture.”

Repositioning Agric Sector

On efforts to reposition the agricultural sector, Mr Adamu said as chairman senate committee on agriculture, he had proposed several bills that would impact the sector positively, saying, “I have about seven bills in the mill, going through parliamentary processes to be passed into law.”

According to him, the bills are, Food Reserve Agency of Nigeria Bill, Research Council Reform Bill, Agric Mechanisation Bill and Agricultural Development Fund Bill among others.

He commended Nigerian farmers for their efforts at ensuring food security in the country despite the challenges they were facing.

He, however, challenged them to adopt new technologies to reap from the potentials available in all value chains in the agricultural process.

He promised that the legislature would continue to play its part in ensuring that the interest of farmers and relevant stakeholders were protected.

Support for Border Closure

Mr Adamu also asked the federal government to ignore concerns in some quarters that the border closure was impacting negatively on the economy.

PREMIUM TIMES reported how the federal government in September closed Nigeria’s borders with its neighbours, mainly to check the smuggling of products.

While some Nigerians have opposed the closure as a violation of international laws and an act of protectionism, others have supported the government’s action as necessary to encourage local production of mainly food items like rice and poultry.

President Muhammadu Buhari has insisted that the borders would remain closed until neighbouring countries like Niger and Benin cooperate with Nigeria to check smuggling and dumping of products in the country.

In his reaction, Mr Adamu said the complaints were being sponsored by smugglers who were hard hit by the policy.

According to him, there is no doubt that adjusting to a new lifestyle of patronising made in Nigeria products will result in temporary inconveniences, but to say the policy is not beneficial is not true.

“The hews and cries we hear are sponsored cries.

“Sponsored in the sense that for whatever reason those who are suffering as a result of closure are those who are into the business of smuggling into this country.

“Therefore, they are being challenged and the only thing they can do is to blackmail government to say that yes they are being denied their source of livelihood but that source of livelihood of theirs is at the detriment of the greater good of the Nigerian nation and its people.

“If we allow our borders to continue to be porous. If we continue to listen to the cries of people who are shedding crocodile tears about the border closure, then we will not be able to protect our own.

“We will not be able to ensure that we develop policies deliberately to protect the interest of people that we are to protect.

“So, yes people are doing businesses with the borders opened but what they are doing is at the expense of the growth of Nigeria’s business.

“Quite a number of what is imported through these neighbours of ours are things that challenge our own ability or plans to produce. We have allowed our borders for so long to be a conduit for bringing into the country what Nigerians are producing.

“And because the cost of production in the so called developed nations is not much, because they know when we produce what they are bringing into the country, our cost of production is way more than their own.

“And so in the market, their produce is cheaper than our own. The challenge we have is whether we should continue to leave our borders so porous for them to be doing brisk business at the expense of the Nigerian producers or we contain their excesses so as to give the Nigerian business community the opportunity to brace up,’’ he said.

Mr Adamu admitted that the border closure has led to an increase in the prices of some essential items like rice and poultry in the country.

“Yes, there is artificial increase in the prices of essential foodstuff just to undermine the effort of government to say people are now suffering. Christmas is at the corner and the prices of foodstuff have increased and all of that but these are all artificial.

“They are all stage-managed to frighten government to say this policy is not popular, we must change it. I think they have the wrong person in their mind. President Muhammadu Buhari is very strong-hearted.”

According to the lawmaker, one major impact of the border closure is changing of Nigerians’ preference for foreign goods.

“The frozen chickens they import are not healthy for consumption. The rice they import, who knows how long they have been stored.

“They just bring it and because it is foreign and we have got the mentality, the appetite of consuming imported produce they put us in the state of mind, unfortunately, that is making it difficult for people to change,” he said.

Mr Adamu declared total support for the government on the development, pointing out that it was one of the occasions that the federal government stood up to protect the interest of Nigerians.

On concerns that the development was affecting the cordial relationship Nigeria enjoyed with neighbouring countries over the years, Mr Adamu said while Nigerians believed in good neighbourliness, the primary responsibility of government was the preservation of the lives of Nigerians and protection of their property.

He said, while the borders may not remain closed forever, some lessons had been learnt.

He prayed to God to continue to strengthen President Muhammadu Buhari and all his appointees to uphold their oath of office and protect the borders and Nigerian businesses by keeping the borders in check.



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