#1Unlocking productivity and investment opportunities across Nigeria's agribusiness value-chain pwc www.pwc.com/ng#2Content 01 Overview of the agriculture sector in Nigeria 05 Unlocking productivity through Finance 0 02 Industry challenges and 06 Investment Opportunities across suggested solutions Nigeria's agribusiness value-chain 03 Toward the US$1 trillion African food market in Africa by 2030 07 Policy reforms in the Agriculture sector -0 04 Unlocking Productivity through Technology#3Overview of the Agriculture sector in Nigeria 1#4Nigeria's agricultural sector contribution to GDP The Agriculture sector has contributed about 25% to National GDP since 2017, and employs nearly half of the total labour force in the country. The sector's GDP growth is at 2.4% for 2019 from 2.1% in 2018... Agricultural sector GDP contribution and growth 26 25 24.73 25 23.89 24 24 23.35 23 23 22 23.91 23.33 23.11 22.9 24.45 8 25.08 25.13 25.16 7 6 5 4 3 2 2 1 22 0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Agriculture (% of RGDP) Agriculture sector (% y/y) Unlocking productivity across Nigeria's agribusiness value-chain PwC 48.2% Share of total employment (2017) February 2020#5Food imports still higher than exports...though decelerates slightly in 2018 Nigeria's food import bill as at 2018 stood at N1.4 trillion, whereas food exports stood at N302 million representing deficit of N1.1 trillion in the period under review...this has been the trend over a long period of time... Food Import bill vs Total Agric Exports (N'bn) 1800 1600 1400 1,174 1200 1000 800 600 400 200 60.7 2016 Unlocking productivity across Nigeria's agribusiness value-chain PwC 170.4 2017 1,559 ■Agric Export ■Food Import bill 302.3 2018 1,432 February 2020#6Livestock, Forestry and Fishery accounts for only 12% of total agriculture GDP... Yet, Nigeria is endowed with maritime waters of 30 sailing miles, and 853 km coastline and over 14 million hectares of inland waters...With growing demand, the livestock segment has the potential to be the most important segment of the agriculture sector in value terms, according to FAO... % of contribution of Agricultural GDP in 2018 1% 3% Crop Production Source; NBS 8% Unlocking productivity across Nigeria's agribusiness value-chain PwC Livestock Forestry Fishing 88% . • Fishing takes place in two main areas; the marine and inland fresh water, with about 60% from marine waterbodies. Major seafood species are croakers, sardine, shrimp, catfish, and shiny nose Fishery imports into Nigeria has been high...hinged on the growing population, and rising demand for fishery products There is absence of a viable processing industry for Nigeria's fish output In 2018, N3.6 billion worth of livestock was imported, implying a gap in the consumption and production of livestock. With growing demand, livestock will become the most important segment of the agriculture sector in value terms, according to FAO Source; FAO February 2020#7Crop Production accounts for over 80% of the total Agriculture Production, however land usage is very small, thus limiting crop output levels. Cassava Yams 59,486 47,943 Top 5 Agricultural products (tonnes '000), 2017 Cocoa Beans Sesame seeds 834.4 Wheat 1,200 Unlocking productivity across Nigeria's agribusiness value-chain PwC 807.1 Maize 10,420 Rice Palm Oil 9,864 7,759 Top 5 Agricultural Exports ($'mn), 2018 Cashew Nuts Cocoa butter, fat, oil Other Frozen Shrimps & Prawns 606 152.5 139.1 Top 5 Agricultural Imports ($'mn), 2018 Whole fish (frozen) Sugar Cane Milk/cream products Flour/ starch/malt extracts 543.9 446.4 279.3 262.1 February 2020#8There is urgent need to gather better and accurate statistics on agriculture production and output...technology may help more than manual survey to aggregate and gather data more frequently and efficiently ... Cassava Unlocking productivity across Nigeria's agribusiness value-chain PwC Nigeria Democratic Republic of Congo Thailand 2nd Largest Producer 3rd Largest producer Produced 30.8 million tonnes of Cassava in 2017 • Produced 31 million tonnes of Cassava in 2017 Largest Producer • Produced 59.4 million tonnes of Cassava in 2017 February 2020#9Empowered by geo-locating and sensor-based technologies, precision agriculture brings a data-intensive paradigm into farming Yam Unlocking productivity across Nigeria's agribusiness value-chain PwC Ghana Cote D'Ivoire 2nd Largest Producer 3rd Largest producer • Produced 7.9 million tonnes of Yams in 2017 • Produced 7.1 million tonnes of Yams in 2017 Nigeria Largest Producer • Produced 47.9 million tonnes of Yams in 2017 http://ceur-ws.org/Vol-2322/BigVis 4.pdf February 2020#10Satellite images coupled with Geographic Information systems (GIS) and Global Positioning systems (GPS) are becoming more frequently employed, providing important data which details objective estimations of crop conditions and yields. Maize Unlocking productivity across Nigeria's agribusiness value-chain PwC Nigeria 15th Largest producer . Produced 10.42 million tonnes of Maize in 2017 **** China United States 2nd Largest Producer Produced 259.2 million tonnes of Maize in 2017 Largest Producer • Produced 397.6 million tonnes of Maize in 2017 February 2020#11Rice Unlocking productivity across Nigeria's agribusiness value-chain PwC India China Nigeria 2nd Largest Producer 14th Largest producer • Produced 168.5 million tonnes of Rice in 2017 Largest Producer ⚫ Produced 214.43 million tonnes of Rice in 2017 • Produced 9.8 million tonnes of Rice in 2017 February 2020#12Aggregating accurate statistical data is key to planning for, and achieving significant agricultural gains for economic growth and development... Oil Palm Unlocking productivity across Nigeria's agribusiness value-chain PwC Malaysia Nigeria 2nd Largest Producer 4th Largest producer Produced 101.7 million tonnes of Oil Palm in 2017 . Produced 7.7 million tonnes of Oil Palm in 2017 Indonesia Largest Producer • Produced 114.6 million tonnes of Oil Palm in 2017 February 2020#13Current status of the forestry industry Contribution of forestry to agricultural GDP The Nigerian pre-independence era, saw several gigantic forest reservation activities take place. This aided the protection of about 96,518 square kilometers of land (27% of the total forest cover) and 10% of total land area. However, the current rate of deforestation is alarming, and has caused a loss of 350,000-400,000 hectares of forest annually in recent times. • 1.7% 1.0% 1.0% in 2017 in 2018 in 2019 Forestry has consistently been the least contributor to agricultural GDP over the years, this could be linked to the plywood industry with outmoded integrated mills. The contribution of forestry to agriculture has declined over the years, this is hinged on continuous felling of trees (some of which are illegal) without a commensurate planting of trees. This endangers the climate as a result of imbalance in the ecosystem, and would impact the industrial sector negatively. Investment in forestry industry has wide-ranging impact, which include addressing climate, social and environmental challenges, and expanding the production of wood-related industries. APFnet Unlocking productivity across Nigeria's agribusiness value-chain PwC https://economicconfidential.com/2019/03/challenge-of-deforestation-nigeria/ February 2020#14Industry challenges and suggested solutions 2#15Agriculture Industry Issues and Challenges In Nigeria more attention is channeled toward primary production and little to manufacturing into finished goods creating a poor value-chain Relative to the size of the population agricultural productivity in Nigeria is extremely low and has to import for the difference Outdated system of agriculture such as hoes and cutlass and inadequate facilities such as good road and good water is crippling the agricultural sector Common issues associated with agriculture in Nigeria In Nigeria, 38.2 percent of GHG emissions came from the land-use change and forestry sector, which contributed 32.6 percent, to GHG emission. All other factors crippling agriculture are also the reasons people don't invest in it. The desire for quick return on investment and security of investment also contribute Violent conflicts such as the Fulani Herdsmen conflict and argument over land ownership in the country can discourage investment Resource shortages (land, water, seeds) reduction in the amount of grazeable land, desertification in the north as well as fertile soil Population growth & food insecurity. Nigeria has the highest people living in extreme poverty in the world. The inability to feed it self is a big and growing concern Unlocking productivity across Nigeria's agribusiness value-chain PwC February 2020#16Crop Production Issues and challenges • Changes in weather conditions • Inadequate funding/access to credit • Lack of modern mechanization • Poor infrastructure/logistics • • Poor accessibility to improved seedlings from crop variety Increased land registration issues Unlocking productivity across Nigeria's agribusiness value-chain PwC • • • • • Suggested solutions Adopt no-till farming and other sustainable means of farming Increase access to finance and education for small- scale farmers Adopt the use of mechanization and technology in agriculture (e.g. drone technology) to boost farmers' productivity levels Develop road and rail infrastructure to aid the transportation of fresh produce and reduce wastage Improve the distribution of good quality inputs to small- scale farmers to boost the quality of crops being produced Increase investments aimed at improving irrigation systems February 2020#17Livestock segment Issues and challenges • Feed scarcity . • • Lack of proper housing Low reproductive performance Diseases and pest • Low financial support • Regional conflict and instability Unlocking productivity across Nigeria's agribusiness value-chain PwC • • • Suggested solutions Provide improvised feeds and investment in local feeds production, as well as support for imports Provide farmers with the skills and financial support to build proper working shelters for animals Improve quality of local breeds and conduct research into ways to improve reproductivity among breeds (Tsetse and trypanosomiasis has been regarded for many years as the most severe constraints on cattle production within the Nigerian Middle Belt) February 2020#18Marine production Issues and challenges Suggested solutions . Reduced marine nutrient due to water pollution • Control water pollution • Poor fishing methods • Improve fishing technology • • ● • Inefficient fishery policies Inadequate technical capacity and skills Lack of implementation of climate change strategies Overfishing, resulting in extinction Predation on small fishes by larger ones Unavailability of financial resources Unlocking productivity across Nigeria's agribusiness value-chain PwC • ● • Properly channel policies aimed at mitigating challenges Employment and training of manpower with technical know-how Properly supervise implementation of climate change strategy Completely ban illegal fishing • Provision of adequate financial support February 2020#19● . Forestry sector Issues and challenges Destruction of forests through bush burning Illegal felling and poor security of timber. • Poor implementation of forest policies . • Poor mechanization and slow cultivation processes • • Poor funding and investment of the forestry sector • Data inaccuracy • FOSA country report Unlocking productivity across Nigeria's agribusiness value-chain PwC • Suggested solutions Proper implementation of forestry policies • Good documentation processes to serve • against illegal felling of trees. Introduction of advanced technology into forestry and cultivation processes Collection of forestry data through better and reliable technology Adequate funding and investment of the forestry sector Adequate provision of raw materials for the forestry industry February 2020#20Toward the US$1 trillion African food market in Africa by 2030 3#21Brazil's agricultural exports make up about 7.3% of the global agricultural trade... Top 5 Key Players in the Agricultural Sector ($'mn) 60,000.00 • With a population of about 208.5 million people as at 2018, Brazil is the 31st largest country in the world. In 2018, Brazil's Agriculture to GDP was valued at $0.08bn, representing contribution of 4.3% to the total GDP of $1.8bn. Brazil is the world's largest exporter of coffee and livestock production and a major player in the exports of sugarcane, soybeans, grains, cocoa and cotton. . 50,000.00 • Its total export value of agricultural products in 2017 was $100 billion. The Brazilian Government introduced several initiatives to further develop its agricultural sector: • . • • Family Farming - In 2006, the government launched its programme for the strengthening of family planning, which was aimed at developing the output of small- scale farmers, by providing low interest rates and price guarantees for these families. Deregulation Increased PPPs in the development of road and rail networks to ease the transportation and exportation of its agricultural produce, ensuring seamless delivery of its crops Low Carbon Agriculture policies – In 2013, the Agriculture Ministry introduced the Low carbon policy by providing low interest loans to farmers who would like to implement sustainable agricultural practices such as no-till agriculture. • Price support & Subsidized credit insurance programs Source: World bank, FAO, OECD PwC 50,025.20 40,000.00 30,000.00 20,000.00 10,000.00 8,312.30 8,182 4,464.70 2,873.70 0.00 JBS Brasil Foods Marfrig Alimentos Minerva Tereos Internacional Volume of the top agriculture products (mn tonnes) 140 122 120 100 82 88 80 60 40 40 20 Soyabean Corn 50.9 38.9 26 Coffee Unlocking productivity across Nigeria's agribusiness value-chain Sugar Diary February 2020#22USA's agriculture GDP reached high of US243.1 billion in Q3 2019... USA is the 3rd most populous country in the world with population of 329,246,408 ✓ The top 10 agribusinesses in USA have total combined revenue of US$272.02 billion. Some of the technologies used to drive agricultural development in the USA are; Weather Tracking Factors used by USA for the success of food security Establishment of linkages between global food security, political stability, and economic prosperity. Increased urbanization and elimination of gender inequalities Combating political instability and climate change • GPS • grain binder . pervasive automation • drones imagine, minichromosomal technology • modern rotary combine • RFID Technology Increased financial access to small scale farmers who are constantly exposed to external shocks. U.S. Global Food Security Strategy Emphasis laid on leadership in humanitarian assistance. USA's Agricultural GDP reached a high of US$243.10 billion in the third quarter of 2019 with total exports of produce worth US$24.245 billion comprising mainly soya beans at 39,712,000 metric tons, coarse grains of 38,537,000 metric tons, corn at 36,324,000 metric tons, and wheat with 22,914,000 metric tons Increased nutrient targeted intervention Source: World bank, FAO, OECD PwC Investments in food and nutrition security Unlocking productivity across Nigeria's agribusiness value-chain Improvement in R&D investments to boost technologies and innovations February 2020#23China's agricultural sector has doubled in size in the last decade... China's agricultural sector value-added has doubled its size in the last 10 years. As at 2018, the sector's GDP was put at US$978.45 billion, representing a 109.43% increase from US$467.20 billion in 2008 ✓ 200 million Chinese farmers are responsible for feeding about 1.4billion people in China. ✓ The proportion of labour employed in the sector declined from about 50% in 1991 to around 16% in 2018, owing to the increasing adoption of innovative approach Major technologies adopted to drive the sector 1. Artificial intelligence (AI) 2. Cloud computing infrastructure 3. Biotechnology and genetically modified organism (GMO) Source: World bank, FAO, OECD PwC Key transformation factors Population(rank) : 1st GDP(rank): 2nd 1 Favorable agricultural policies and programmes such as the promotion of irrigation and high investment in the sector (Fertilizer, Subsidies, equipment and R&D I 2 Two ways of land ownership( state owned public land ownership and farmer collective-owned rural land) 3 Greater adoption of modern agricultural production techniques, with focus on organic farming. Consequently, the country accounts for more than 85% of the world's greenhouses Major agricultural products ('000 tonnes), 2019 300,000 250,000 200,000 131,430 150,000 100,000 50,000 0 Wheat 257,333 Corn 148,490 16,000 13,800 Rice Soyabean Livestock Unlocking productivity across Nigeria's agribusiness value-chain February 2020 I#24Unlocking Productivity through Technology 4#25PwC Ways technology can transform Agribusiness The UN expects agricultural production to rise by 69% between 2010 and 2050. To meet the expected increase in demand, farmers are implementing advanced technological techniques to boost productivity. Drone Technology Drone Technology is an excellent innovation that can be used to improve the productivity of the agricultural sector through an aerial angle. . • Wildlife Conservation, Soil & Field Analysis Drones are useful in analyzing the capacity of the soil or field intended for farming. They produce precise 3D maps that help farmers view the full landscape of their lands without physically being present in the farm. Planting & Crop Spraying - these systems come in variations that can also shoot pods with seeds and plant nutrients into the soil, they can also assess the ground and spray the adequate amount of liquid needed to achieve optimal growth. Subsequently, increasing productivity levels and efficiency of the farming process. • Blockchain Technology Blockchain is rapidly being introduced into many sectors including agriculture. Blockchain can be adapted to ease agricultural processes through: Optimization of Supply Chains - Blockchain allows farmers to adequately set their prices and the quantities to be sold. True pricing is achieved by realtime recording of transactions. This provided accurate supply and demand information to customers. Agricultural Insurance - By automatically providing information on adverse weather changes, changes in price of the crops and the state of the products, blockchain technology helps the insured parties aware of the optimal time to receive their payouts. Traceability Blockchain ledgers can provide information on the status of the produce from planting to its delivery through the provision of real time data. • • Artificial Intelligence Artificial Intelligence Technologies are being used around the world to improve the efficiency of farming techniques, increasing the crop yield and productivity per hectare. Farming data analysis - Al is being used by farmers to analyze the effects of weather conditions, temperature or soil conditions in the productivity of the farms. Al also helps farmers increase their crop yield by determining the best combination of seed choices and resources to yield optimal results. Solving labor shortages - Al provides solutions for the shortage of skilled farmers around the world by introducing agriculture bots, that can harvest crops at a faster pace than humans. These bots can also identify and remove weeds more accurately, subsequently reducing the input costs for farmers. Unlocking productivity across Nigeria's agribusiness value-chain February 2020#26PwC Companies using Technology to transform Agribusiness • Bitland, Ghana Bitland is a Ghanaian startup, founded in 2015 which uses blockchain technology to boost the reliability of land records and settle land disputes within Ghana. Bitland acts as a liaison between people seeking to register their land titles and the officials to create a central registry and eliminate the inefficiencies and corruption. • The company issues digital tokens, Cadastrals, which can eventually be used to invest in the local economy. • It has already allocated 20 million Cadastrals to be used as an initial coin offering in the creation of the first Bitland center. • The improvement of land registry records will help farmers have a tangible hold on their land and the possibility of these farmers having greater access to finance as the banks can now use their land as collateral for loans Unlocking productivity across Nigeria's agribusiness value-chain February 2020#27Companies using Technology to transform Agribusiness. • . . Microsoft's Farmbeat Farmbeat is a product of Microsoft and was launched in Kenya and South Africa in 2019 Using data, coupled with the farmer's knowledge and intuition about his or her farm, Farmbeat intends to boost farm productivity, and help reduce costs. Farmbeat's goal is to increase world food production by leveraging unique solutions to solve agricultural problems using low-cost sensors, drones, vision and machine learning algorithms. Essentially, it tracks soil temperature and moisture levels with the use of solar-based cloud computing models, taking the guess- work out of farming. Aerobotics, South Africa Aerobotics is a South African agri-tech company which protects tree crops through early detection of problems on farms. It does this by using aerial imagery and machine learning algorithms to help farmers identify pests and diseases early. Essentially, Aerobotics end-to-end solution ranges from pest and disease management, yield management, problem tree identification, orchard management etc. Disease detection is aided by flying of drones and artificial intelligence. Unlocking productivity across Nigeria's agribusiness value-chain PwC February 2020#28• ☐☐ Companies using Technology to transform Agribusiness in Nigeria Farmcrowdy . . • Farmcrowdy is the first digital agriculture platform in Nigeria. The company focuses on connecting real farmers with their sponsors in a bid to increase food production and foster youth participation in agriculture It unique point is its platform that offer investors opportunities to invest in various farm produces at their convenience through their phones or computers. In 2019, the company attracted about $1 million addition seed funding from Cox Entreprise, Techstar and loca investor Ajayi solution The company profit sharing model involves splitting post harvest revenue between the sponsors and farmers, while it retains 20% of the profit Recently, it has embarks on a number of sustainability initiatives. For instance, it launched Crowdyvest to offer investors opportunities in other sectors, and also promised to roll out retail meat hubs in Q2 2019 after it acquired Best Food Limited in February 2019 Agromall . Agromall is a Nigeria-based company that offers services relating to digitized agricultural production support, digitized agricultural extension and digital finance • The company leverages technology to identify investment opportunities and effectively deliver them, mostly to the rural economy, while data on individuals and the sector is adequately provided to support efficient decision on choice of investments. • The company does not only enhance farmers' productive capacity, but also support financial inclusion in the rural areas Unlocking productivity across Nigeria's agribusiness value-chain PwC February 2020#29Unlocking productivity through Finance 5#30PwC 7 emerging innovations in agriculture finance 1 Asset finance 2 Credit risk assessments of information related to systemic risks 3 New information systems 4 Leasing for agricultural risk management 5 Factoring 6 Value chain finance 7 Agricultural technology companies are also becoming important financiers Unlocking productivity across Nigeria's agribusiness value-chain February 2020#31PwC Agriculture financing challenges and risks 01 Limited collateral 06 Regulatory environment 05 Increasing climate variability Unlocking productivity across Nigeria's agribusiness value-chain 04 Low financial literacy rates 02 Poor infrastructure in rural areas 03 Land use management/land ownerships February 2020#32Intervention to overcome agriculture financing challenges and risks PwC 1 21 Capacity development -offer training to farmers and advice them on how to undertake farming as a profitable business Develop agricultural customised loan products that are relevant to farmers' needs - this could enable farmers to borrow and repay loans successfully De-risk through financial and entrepreneurship education 3 Establish strong partnerships and alliances to promote investment in Agriculture 4 Deployment of high-end technology to enhance efficiency and convenience of access 5 Unlocking productivity across Nigeria's agribusiness value-chain February 2020#33PwC Financing agriculture in Nigeria Pillars for agriculture intervention Value Chain Strategic Technology Capacity Building • • partnerships Approach Innovative financing models Unlocking productivity across Nigeria's agribusiness value-chain ● Innovative Financing Models Partnerships Risk - sharing/credit guarantee funds Post harvest management Crop/livestock insurance Deposit Mobilization supported lending Social payment systems February 2020#34Investment Opportunities across Nigeria's agribusiness value-chain 6#35Reshaping Nigeria's Agribusiness Landscape Integrate agriculture value chain to manufacturing Invest in agriculture infrastructure Agriculture as a Introduce business: Enhance crop and mechanization capacity building and education yields and output modern irrigation system Unlocking productivity across Nigeria's agribusiness value-chain PwC Adopt technologies and innovations Land reforms and integration of national and sub-national policies February 2020#36Investment opportunities in crop production value-chain Agro Input producers Farmers Processors/ Dealers Storage Industrial Manufacture Trade or Direct consumers Mechanisation Fertilizers, feed for and animals, pesticides, finance and farming equipment, etc. technology, improved farming techniques, capacity development and access to finance to boost output and productivity Agro- processors adding value to raw farm produce e.g. plantain into plantain chips, cassava into garri and agro- dealers involve packaging and branding Silos, Grain Conveyors, Grain Dryers, Vacuum Hermetic Fumigation, Gas Hermetic storage Manufacturing of processed agricultural produce and intermediate products. Local sales and exports PwC Unlocking productivity across Nigeria's agribusiness value-chain February 2020#37Investment opportunities in livestock value chain Mating/ Hatching Breeding Packaging / Storage Transport Allied Industries Trade or Direct consumers Opportunities include machine for hatching eggs Feeds for animals and veterinary services, livestock ranch management, vaccines for inducing mating poultry partners, etc. facilities, processing plants for meat Cutting, hanging, freezing in cold room are part of this stage. Other opportunities include chemicals for preservation Moving meat from one place to another can be another form of investment, the movement can be when the meat is alive or frozen. Leather for shoes bags and belt, pesticides, Packaging and marketing Food and beverage industries Fibres and textiles All kinds of meat, hotdogs, chicken, pork etc. other opportunities involving domestic sales and exports Unlocking productivity across Nigeria's agribusiness value-chain PwC February 2020#38Investment opportunities in fishery value-chain Production/ Harvesting Processing& Storage Transport Manufacturing/ industrial sector Market Wholesale and retail Tanks & fish ponds construction Provide Funding Feed production Invest in technology to boost production Phytoplankton & macrophytes to treat sewage Direct involvement Trainings Processing plants Refrigerated Dying machines trucks/ vans Technologies that Refrigerators for storage . Trainings on link maintenance of manufacturing to producers Provide funding Trainings Direct involvements repairs & the special vans Invest in technology & data to monitor and enhance quick delivery of products Packaging of fish products for export Temperature control technology for preservation Provide essential facilities to support fish markets such as electricity, health services etc. Technology to efficiently connect producers, wholesalers and retailers to large markets Provide funding Unlocking productivity across Nigeria's agribusiness value-chain PwC February 2020#39Investment opportunities in forestry value chain . · Forest Management Investing in plants(seeds) and machines that enhance forest management. This also promotes green environment Provide trainings on health and safety • Transport Import logging trucks to identified viable markets for forestry in SSA countries Manufacturing & Industry This hold enormous investment opportunities • Molding, framing and packaging • Production of furniture, paints, ink, Cigarettes Filters, medicine Pulp and paper production Trade Provide funding to facilitate Wholesaling and retailing • Trainings on skills to identify viable local and foreign markets Unlocking productivity across Nigeria's agribusiness value-chain PwC • Primary Processing Import of processing machines to meet local or regional demands Trainings on the best use of the equipment • Trade Integrate technologies that effectively connect large scale consumers to the markets http://www.fao.org/forestry/46498-0eacc6c34dec075543f07776480e367a3.pdf February 2020#40Policy reforms in the Agriculture sector 7#41Policy reforms in the Agriculture sector Agricultural transformation Agenda (2011-2015) 2 In 2010, the FG saw the need to restart the clock of agriculture in a sustainable way by introducing private sector led strategies. This was anticipated to make the sector more productive, efficient and effective. The broad objectives include 1. creates 3.5 million jobs, 2. generates foreign earnings 3. cut down spending on food importation Among other achievements recorded, the policy was able to improve farmers access to fertilizer and seeds. The Agricultural Promotion policy (2016-2020) 1 Having assessed the progress of the Agricultural Transformation Agenda (ATA) implemented from 2011 to 2015, the FG identified two major gaps that required urgent attention, which include prolonged significant food importation and low foreign earnings from agriculture. This birthed the APP in 2016. Consequently, food importation declined in 2016(as due to recession) and 2018 by 10% and 9%, respectively. Economic Recovery and growth plan (ERGP), 2017-2020 3 Among the five key execution priorities of the ERGP, achieving agriculture and food security was one of the major focus Plans were made to ensure the nation is self-sufficient in tomatoes by 2017, rice by 2018 and wheat by 2019/2020. hence, Nigeria is expected to be net exporter of key agricultural products(rice, cashew nuts, groundnuts, cassava and vegetable oil) by 2020 CBN intervention programmes 4 The programmes include: The Anchor Borrowers programme Listing of more items to forex restriction Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL Plc.) https://agra.org/wp-content/uploads/2018/10/AASR-2018.pdf Unlocking productivity across Nigeria's agribusiness value-chain PwC https://www.tralac.org/images/docs/10154/nigeria-agriculture-promotion-policy-2016-2020.pdf February 2020#42Industry developments in the agriculture sector in 2019 In a bid to reduce the pressure on foreign reserves, the FG instructed the CBN to stop granting foreign exchange for milk importation. In similar manner, the CBN also directed DMBs to stop providing credit guarantee to milk importers Forex on food and milk importation The CBN signed two MoUs with the intention of providing loans of N19.18 billion to 9 cotton-producing companies. The first agreement was signed between National Cotton Association of Nigeria and Ginning companies, while the second was between Nigeria Textile Manufacturing Association, among others Signing of MoU to boast cotton production The partial closure of Nigeria's land border was one of the major steps taken by the FG in 2019 to discourage unlawful importation, mainly from Niger and Benin Republic. Border closure . In January 2020, USAID launched a US$60 million co-investment fund to stimulate economic growth in Nigeria, with special preference for the agricultural sector to drive the growth of non-oil based sector In the same period, Turkish government has planned to invest US$15 million in Nigeria's agricultural sector in two years New Investments in Nigeria's agricultural sector https://agra.org/wp-content/uploads/2018/10/AASR-2018.pdf Unlocking productivity across Nigeria's agribusiness value-chain PwC https://www.tralac.org/images/docs/10154/nigeria-agriculture-promotion-policy-2016-2020.pdf February 2020#43Contacts Andrew S. Nevin, Ph.D. Partner and Chief Economist [email protected] Taiwo Oyaniran Associate Director [email protected] Omomia Omosomi Manager/Economist [email protected] Temitope Omosuyi Industry Analyst [email protected] Acknowledgement We would like to acknowledge Yemi Akoyi, Adunola Bello, Afomachukwu Ukah and Oluwanifemi Olojo for their contributions to the development of this publication.#44Thank you pwc.com © 2020 PwC. All rights reserved. Not for further distribution without the permission of PwC. "PwC" refers to the network of member firms of PricewaterhouseCoopers International Limited (PwCIL), or, as the context requires, individual member firms of the PwC network. Each member firm is a separate legal entity and does not act as agent of PwCIL or any other member firm. PwCIL does not provide any services to clients. 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