The Governor of Central Bank of Nigeria, Mr Godwin Emefiele says that
Nigeria needs to more than double the proportion of bank loans it makes to the agricultural sector to 10% within the next four years to boost food production in the country.
The CBN revealed to Bankers on Tuesday that Loans to the food sector account for around 4% of total credit, this is as President Muhammadu Buhari last week instructed the central bank to stop dollar sales for food and fertiliser imports.
Emefiele said the coronavirus pandemic had exposed the risk of relying on food and drug imports, as most countries are reluctant to export goods.
Nigeria is heavily reliant on imports, including importation of foods, to meet its needs due to limited manufacturing capacity. The country has been trying to cut its $20 billion annual food import bill, but has struggled to build up an economy outside its dominant oil sector.
Despite rice growing being a government priority, many farmers still work with their bare hands in fields lacking irrigation channels.
Mills are often ramshackle, while poor roads make getting the crop from the main growing areas in northern Nigeria to consumers in the south difficult and costly.
The country is facing its worst economic crisis in four decades, triggered by an oil price crash induced by the pandemic.
The crisis has slashed government revenues, weakened the currency and created a large financing gap.