‘Reliance on trade restrictions keeps agric sector below potential’

Continued reliance on trade restrictions as a primary tool for stimulating local production would lead to greater market instability, undermine supply and expose consumers to significant price fluctuations, therefore making food security elusive as population growth puts more pressure on food resources.

This was part of the insights shared in the 2021 Agriculture Industry Report by Sterling Bank Plc, in partnership with StearsData.

The report equally showed that Nigeria’s agricultural sector is operating below its potential, “even by its standards.” It identified the inefficiencies that slowed and crippled the growth of the sector.
COVID-19 and its attendant shock, according to the report, reinforce the need for an agricultural sector that is more resilient to shocks an imperative.

The report, therefore, advocated improved production methods that are more efficient and sustainable, investing in large scale storage so that national reserves are sufficient in times of crisis or implementing a public sector framework such that issues that concern the sector can be assessed by the appropriate bodies and a coordinated response is pushed out in a timely manner.

The four-part report critically examines the country’s agriculture value chain state, state of affairs post-COVID-19, the climate change challenge and opportunities for innovations and investments.

Group Head of Agric Finance and Solid Mineral at Sterling Bank, Bukola Awosanya, said the industry report empowers players in the agriculture sector with a navigation roadmap and affirms the bank’s commitment to de-risking and making the domestic agriculture value chain more viable for commercial lending.

“The goal of the report is to help investors and operators understand the challenges facing the sector, consider recommendations by experts, and become aware of relevant opportunities, both now and in the future. It would empower them to support policymakers to craft policies that would create the enabling an environment that the sector needs to thrive,” Awosanya informs.

The industry report also advised policymakers to protect the blossoming innovation ecosystem in the sector with consistent policies and collaboration to foster growth.

It suggested a value chain approach so critical links are not ignored when designing solutions for the sector.

“As Nigeria inches out of another recession, there is no better time to take steps that support its resolute claims that the performance of its agriculture sector is key to its long-term growth.”
She disclosed that the first part of the report provided an overview of the agricultural value chain and analysed some of the conditions that led to the sector’s underdeveloped state.

While the second part reviewed the impact of the COVID-19 pandemic on the country’s agriculture sector, response to the pandemic, and lessons learnt from other countries on the need to build a more resilient agricultural sector.

The third part explored how climate change impacts the sector, highlighting ways stakeholders can overcome the challenge. And the fourth part of the report explored opportunities for innovation and investments and how recent innovation is transforming the industry.

Chief Economist at Stears, Michael Famoroti, said the Agriculture Industry Report 2021 provides insights and actionable recommendations for future-proofing the sector from severe disruptions such as the COVID-19 pandemic. He added that the recommendations are essential for all stakeholders and a valuable resource for building a resilient and commercially viable industry.