FEC approves N32b credit facility for FADAMA III

The Federal Executive Council on Wednesday approved $200 million (about N32 billion) World Bank, International Development Association credit facility for the National FADAMA III Development project.
The Minister of State for Finance, Dr. Yerima Ngama, made this known when he briefed State House correspondents on the outcome of the council meeting presided over by President Goodluck Jonathan.
Ngama said the budget for the FADAMA III was $250 million, out of which the $200 million would be sourced through the IDA.
He said in sourcing the balance of the fund, $7.95 million would be provided by the three tiers of government, while the balance of $42.05 million would be provided in kind by the benefitting communities.
The minister said that the loan would be negotiated and signed by the Federal Government, while participating states, Lagos, Niger, Anambra, Enugu, Kano and Kogi, would enter into subsidiary agreement with the Federal Government.
According to him, the terms of the loan includes zero per cent interest rate, 0.75 per cent service charge and 0.5 per cent commitment charge on the available balance not utilised.
The minister said the facilities would also attract 100 years moratorium and repayment term of 40 years.
The Minister of Agriculture, Dr. Akinwumi Adesina, who spoke in same vein, said the country had 24 million hectares of FADAMA land, most of which were productive
Adesina said the crops been focused on, under the new financing, rice, cassava, sorghum and horticulture, were critical for food self-sufficiency, reduction of import and job creation.
On the six benefiting states, he said Lagos, Niger, Anambra, Enugu and Kano would benefit for rice production, Kano for horticulture and sorghum and Kogi for cassava.
He added: “The project will reach 317,000 farmers and will impact on 1.7 million beneficiaries.
“The facility will support the development of the value chain for the targeted commodities, strengthen the farmers associations in the FADAMA areas and provide extension services for them.
“It will improve irrigation facilities for small scale farmers and most importantly 50 per cent of the grant will go specifically for women who form the bulk of farmers in the country.”
He said the ministry was spending so much on the project because the FADAMA land could get two to three times a yield that could be realised from dry land agriculture when cultivated.
He said: “We feel that it is important to optimise the utilisation of FADAMA land and we are going to scale this up across the country.
“The farmers all across the country, where we have the projects, have organised themselves into what we call a FADAMA micro-finance fund, a small micro finance facility of their own, which will allow the programme to continue to be sustained.”
The minister also said that the 19th edition of the Conference of the Nigerian Economic Summit Group coming up in September would focus solely on the agriculture sector.
He said that President Goodluck Jonathan would launch Youth Employment in Agriculture Programme at the event and about 750 young graduate farmers would be empowered.
The FEC also approved the ratification of the agreement to establish a branch of African Exim Bank in Nigeria.
Ngama, who said this at the briefing, said that though a branch of the bank was set up in the country since 2003, the ratification would grant the institution and some members of its staff diplomatic status.
He said: “The bank was established in 1993 by the African governments along with other institutions like African Development Bank and private investors, including some Nigerians.
“The purpose of establishing the bank is to provide financing, promote and expand intra-African trade.
“The bank has its headquarters in Cairo and started operating in 1994 with two branches, one in Harare and one in Nigeria.
“The bank has its largest market in Nigeria.
“Half of its credit portfolio is given to Nigerian organisations and banks which engage in trade.”
Ngama said the Nigerian government had 5,215 shares, with market value of $443 million in the bank, while other institutions also in the country had 2,448 shares, with market value of $45 million.