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GDP: Govt Targets N21tn From Agriculture

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Agriculture
  • GDP: Govt Targets N21tn From Agriculture

The Federal Government has said it will raise the contribution of agriculture to the nation’s Gross Domestic Product by N5tn before 2020.

It stated that the country’s GDP from agriculture, which stood at N16tn in 2015, would be increased to N21tn in the next three years.

It stated strategies being put in place to achieve this feat in its Economic Recovery and Growth Plan for 2017 to 2020, which was released last week by the Federal Ministry of Budget and National Planning.

Outlining its policy objectives for the sector, the government said it would “increase agriculture GDP from N16tn in 2015 to N21tn in 2020 at an average annual growth rate of 6.92 per cent from 2017 to 2020.

“Government will significantly reduce food imports and become a net exporter of key agricultural products, such as rice, tomatoes, vegetable oil, cashew nuts, groundnuts, cassava, poultry, fish, livestock and Nigeria will become self-sufficient in tomato paste by 2017; rice by 2018; and wheat by 2019/2020.”

The ERGP document noted that in 2015, agriculture accounted for just 23.1 per cent of the GDP and employed about 38 per cent of the working population.

It divided the country’s agriculture sector into four sub-sectors, which were given as crop production, representing 89 per cent of agriculture GDP and recorded 4.1 per cent growth in 2010-2015; livestock, eight per cent, with 3.3 per cent growth; fishing, two per cent, with 7.5 per cent growth; and forestry, one per cent, with 4.3 per cent growth.

On strategies being put in place to meet the targeted N5tn growth in the GDP, the government said it was supporting the integrated transformation of the agriculture sector by boosting productivity in all the four sub-sectors, as well as improving access to markets.

Outlining some key activities to embark upon, it stated that it would fast-track the development and execution of irrigation projects; enhance agricultural extension services, including through N-Power programmes, from the current ratio of 1:3,000 to 1:1,000 by 2020.

It said it would improve access to finance; extend the Anchor Borrowers Programme of the Central Bank of Nigeria to all states and major crops and recapitalise the Bank of Agriculture to provide single-digit interest rate credit to small-scale farmers through the network of micro-credit banks.

The government further stated that it would strengthen the CBN schemes to improve access to finance for all players, including the Agricultural Credit Guarantee Scheme, Commercial Agriculture Credit Scheme and the SME Credit Guarantee Scheme, which will include long-term sunset clauses.

The Minister of State for Agriculture and Rural Development, Senator Heineken Lokpobiri, had earlier said that the agriculture sector would play a vital role in the economic recovery plan of government.

Lokpobiri, who spoke at an event in Abuja, observed that the government was working to diversify the Nigerian economy, away from oil, using agriculture.

According to him, the government is making concerted efforts to achieve its backward integration programme, adding that this will make Nigeria to be self-sufficient in food production when successfully achieved.

The ERGP document further stated that agriculture in Nigeria was facing four big challenges.

It listed the challenges as limited access to financing and inputs for farmers; serious threat of climate change to yield; limited access of agricultural outputs to the national and international markets; and security threats to agricultural investment including cattle rustling, kidnapping, and destruction of farmlands by herdsmen.

It said most farmers struggled to obtain financing to modernise or expand their farms; as well as invest in productive assets or buy inputs.

It added, “To address these issues, the Federal Government launched the Growth Enhancement Support scheme in 2012 to supply subsidised inputs to smallholder farmers. As of mid-2015, 14 million farmers had registered in the scheme.”

To increase agricultural productivity, it stated that government had also mapped soil characteristics across the country and inaugurated irrigation projects.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

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Nigeria’s Non-oil Revenue Now N1.15 Trillion – Minister of Finance

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Mrs. Zainab Ahmed, the Minister of Finance, Budget and National Planning, has said that Nigeria’s non-oil revenue is now N1.15 trillion, representing 15.7 percent above the country’s target. This, she claimed, was a result of the federal government’s efforts at diversifying the nation’s economy.

Mrs. Ahmed disclosed this at the Institute of Directors (IoD) 2021 Annual Directors Conference which was held on Wednesday in Abuja.

According to the News Agency of Nigeria (NAN) the event with the theme: “Creating the Future: Deepening the Corporate Governance Practice through Multi-Sectoral and Multi-Generational Collaborations,” was meant to discuss economic development.

Mrs Ahmed added that the recent development was in line with President’s commitment to further diversifying the Nigerian economy which is heavily dependent on oil. She observed that Nigeria was showing resilience in recovery from recession from coronavirus (COVID-19) pandemic which intensely affected global economies.

The minister said the federal government alongside the private sector had implemented a wide range of monetary measures to stimulate economic recovery, growth and development, job creation and improved standards of living.

She also explained that the government was doing everything to improve and diversify Nigeria’s revenue generation.

Nigeria was quickly able to exit recession and is on her way to path of sustainable growth and we are intensifying efforts to grow and diversify our revenue sources to grow revenue from the current 8 per cent.”

“Our non-oil revenues have grown to N1.15 trillion, representing 15.7 per cent above set target. We are working on the 2021 finance bill and it’s nearing completion. Also, the recent approval of the medium-term national development plan is an important milestone of Buhari’s commitment to delivering sustainable growth and we require strong support and monitoring during implementation,” she said.

Mrs Ahmed reinforced the government’s decision to do something about infrastructure and reduce the cost of production for businesses in the country.

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Intra-Regional Trade Potential a Key Focus in New Report

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A new focus report, produced by Oxford Business Group (OBG) in partnership with the African Economic Zones Organisation (AEZO), shines a spotlight on the continent’s rapidly developing industrial sector, which is poised to become a key driver of broader economic growth as regional integration increases.

Titled ”Economic Zones in Africa – Focus Report”, the report was launched at the AEZO’s 6th Annual Meeting II, which took place on November 25 at the African Continental Free Trade Area (AfCFTA) Secretariat office in Ghana, with participants also able to attend remotely. The meeting was held under the banner “Connecting African Special Economic Zones (SEZs) to Global Value Chains at the era of the AfCFTA” and explored a range of topical issues relating to SEZs, from their potential to boost trade to the impact of Covid-19 on the continent’s supply chains.

The focus report examines the wealth of benefits that the AfCFTA is expected to deliver to both Africa’s economic zones and the businesses located in them, which range from greater market access to a reduction in trade barriers and lower production costs.

The disruption that the pandemic brought to supply chains and the opportunities emerging from the health crisis for businesses to become part of nascent regional value chains across a more closely connected continent are a key focus.

The report also charts the digital transformation taking place in many of Africa’s economic zones, as businesses make the move away from traditional segments to high-tech processes and digital services, adding value to their offerings in the process.

In addition, it provides in-depth analysis of the drive evident among many SEZs to put environmental, social and governance principles and sustainable business practices at the heart of their strategies, at a time when ethical investment and alignment with the UN Sustainable Development Goals are high on the global agenda.

The report includes in-depth case studies and viewpoints by representatives from key industry players namely: Tanger Med; Polaris Parks; Lagos Free Zones; Ghana Free Zones Authority; Misurata Free Zone; and Sebore Farms.

It also includes a contribution from Ahmed Bennis, Secretary General, AEZO, in which he highlights the role that SEZs are playing in the continent’s industrial transformation and the importance of supporting their development.

“Economic zones can play a game-changing role in Africa’s diversification and inclusion by providing end-to-end solutions and services that support industrial upgrades and increase countries’ attractiveness for investment,” he said. “With the implementation of AfCFTA and the post-Covid-19 recovery that the world is beginning to experience, we believe that real investment opportunities exist in Africa at this moment, which can translate into job creation and social and economic development. Africa has resources that need to be developed and economic zones can play a key role in this.”

Bernardo Bruzzone, OBG’s Regional Editor for Africa, added that while African economic zones had experienced production problems during the pandemic due to global supply chain disruptions, ongoing remedial action, including new infrastructure and human capital development, would help provide resilience against future external shocks.

“Africa’s real GDP growth is forecast to reach 3.4% in 2021, with an increase in intra-regional trade and improved connectivity among the facilitators of economic recovery,” Bruzzone said. “Looking ahead, we see economic zones as having a key role to play in helping the AfCFTA achieve its potential through the development of new strategies that will lead to a more diverse, higher-value range of exports.”

The study forms part of a series of tailored reports that OBG is currently producing with its partners, alongside other highly relevant, go-to research tools, including a range of country-specific Growth and Recovery Outlook articles and interviews.

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Lagos Budget N1.4 Trillion for 2022, Budget Surpasses Five Other Southwest States Combined

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Lagos state government has proposed N1.388 trillion budget for the year 2022. The proposed budget was presented to the House of Assembly on Wednesday.

While presenting the proposed budget, Governor Babajide Sanwo-Olu said the State would be spending N325 billion on vital infrastructure projects in key sectors to energise and expand the growth of the State’s economy.

The key areas of growth identified by the Governor include Works and Infrastructure, Waterfront Infrastructure Development, Agriculture, Transportation, Energy and Mineral Resources, Tourism, Entertainment and Creative Industry, Commerce and Industry, Wealth Creation and Employment.

The proposed budget, christened “Budget of Consolidation”, will be the last full-year fiscal plan of the State before the next general election.

About N823.4 billion, representing 59 per cent of the 2022 budget, is earmarked for capital expenditure. Recurrent expenditure, representing 41 per cent, is N565 billion, which includes personnel cost, overhead and debt services.

Of the total proposed expenditure, N1.135 trillion would accrue from Internally Generated Revenues (IGRs) and federal transfers, while deficit financing of N253 billion would be sourced from external and domestic loans, and bonds projected to be within the State’s fiscal sustainability parameters.

The State would be earmarking an aggregate of N137.64 billion, representing 9.92 per cent of the 2022 budget, for the funding of green investment in Environment, Social Protection, Housing and Community Amenities.

This financial proposal is presented with a sense of duty and absolute commitment to the transformation of Lagos to a preferred global destination for residence, commerce, and investment. The budget projects to see a continuing but gradual recovery to growth in economic activity as the global economy cautiously recovers from the impact of the Coronavirus pandemic,” the governor said while presenting the budget to the house.

Meanwhile, the 1.388 trillion budgeted for 2022 is higher than the budget of the five other southwest states combined. For 2022, Ekiti State’s budget is 100.7 billion, Osun 129.7 billion, Ondo 191billion, Oyo 294 billion. Ogun’s budget for 2022 is not yet finalised, but going by their 2021 budget of 339 billion, the combined budget of the five South-West states then amount to 1.053 trillion. With this, Lagos state budget is higher than the five states budget with a difference of 335 billion.

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