ANALYSIS OF THE COMPONENTS OF THE PROPOSED $30BILLION FGN BORROWINGS-SERIES TWO.

WE MUST BORROW TO REDUCE THE UNACCEPTABLE 87% POVERTY RATE IN THE NORTH AND NOT TO STUFF THE POCKETS OF PUBLIC SECTOR BUREAUCRATS.

Our focus and attention in these series it to proffer alternative transparent, honest and massively productive schemes, projects/media through which these HUGE DEBTS can be channelled to help us grow our economy, create massive rural jobs in Nigeria and generate more than required compensating revenues to repay the debts over the next 10 years.

One of the components of the FGN $30billion is the planned $500m (N181b) to be borrowed UNDER the Staple Crops Processing Zone Development.

Another $100m/N36billion under staple crop development program for KOGI STATE and,

Another $200m/N72billion agric transformation scheme

One beautiful thing I must commend about this particular class of debt, is that it is tied to staple crop production and has a minimum tenor of 20 years. It is also priced at a very concessionary rate of 1 to 1.25% per annum.

VERY COMMENDABLE. I MUST COMMEND THE FG FOR THIS DEBT COMPONENT.

HOWEVER , THE NATIONAL ASSEMBLY SHOULD QUICKLY DELIBERATE ON THIS, UNDER A MORE TRANSPARENT, PRIVATE SECTOR LED FRAMEWORK.

The planned public sector loan procurement design and utilization architecture under the current very corrupt public sector bureaucracy SHOULD NEVER BE ACCEPTED . We must not go through a public sector led debt procurement and administration route that puts the liability wholly on the balance sheet of the FGN.

ALTERNATIVE LOAN PROCUREMENT AND DISBURSEMENT ARCHITECTURE THAT CAN TRANSPARENTLY AND EFFECTIVELY WORK FOR US- Recommended ways forward:

The FGN should aggregate the whole $800million/N288billion Agric-linked borrowing under the management and administration of the Nigeria Sovereign Wealth Investment Authority. The borrowed funds should be administered under robust PPP frameworks with the NSIA as the funds watchman. The deposit money banks and micro-finance banks will serve as the fund transmission agents .

ILLUSTRATION ONE…..

STAPLE CROPS… are those crops/plants grown for the parts which are used as staple foods. A staple food is one that is regularly consumed in large quantities as to form the basis of a traditional diet and which serves as a major source of energy and nutrients .

The major staple crops in Nigeria include; Rice, Maize, Cassava, Yam, Potato, Soya beans, Beans, etc.

Thus, the transparent and accountable application and utilization of these borrowed long term agro revolution funds, under the management and administration of NSIA across the states in Nigeria using diverse and robust PPP frameworks will help us to ensure food security, create jobs, improve on our non oil exports, checkmate waste of our scarce dollar resources importing what we can easily produce here and improve productivity.

FOR INSTANCE, IF WE DEPLOY THIS $800M/N288BILLION to boost domestic production of rice…. Under the recommended transparent funds administration framework above, the following positive results will be seen before end of 2020:

1.Cultivation of extra 1,000,000 hectares of paddy rice plantation across the Nigeria rice belt under clusters

2.Creation of 1,000,000 small holder farms jobs and agri-preneurship in the rural rice belt clusters

3.Establishment of 750 units of fully automated small scale parboiled rice milling plants across the hinterland in Nigeria.

4.Create over 7,500 factory jobs and over 32, 000 indirect jobs

5.Add over N480billion to our real sector economy and help to boost our GDP

6.Save us over $1.5billion that would have been wasted importing rice into Nigeria .

WHAT the governments at all levels and arms should concentrate more on doing , is creating the secured and enabling policy and program environment to boost and support domestic staple crops production:

What are the governments and agencies doing to support our local farmers and agri-preneurs to procure and distribute the high yielding rice varieties that are grown in Egypt amongst the local farmers here in Nigeria?

Our current local rice yield per hectare is so low. For our domestic output to compete with that of other rice producing nations and help mitigate the destructive impacts of smuggled rice into Nigeria, we must be able to domesticate the high yielding rice varieties that are grown in Egypt(6 to 9 tons of paddy rice production per hectare ). This is where Research and Development of our whole staple crop value chains comes into play.

We must also recreate the Farm Produce Boards as we used to have them in the early 1960s. Ivory Coast has similar schemes. Membership of such board should not be for political cronyism. It should be a composition of representative of the real farmers (not portfolio/ paper ones), representative of the bankers committee and governments.

It is not just enough to go to the World Bank and AFDB to borrow concessionary funds for staple crop production. The supporting transparent funds administration and execution architecture must be in place to enable us extract maximum benefits from the borrowed funds. The fiscal and security covers must be in place too.

NIGERIA IS TRULY A LAND BLESSED BY GOD . We can sincerely turn this land from her current state as the extreme poverty capital of the world, into a paradise for all.

The whole SCIENTIFIC design, structuring, fund transmission, execution and impact monitoring architecture for this project/scheme are contained in our work book,…ACRES OF DIAMOND.

God has ALREADY helped us…Let’s honestly help ourselves and rescue the 100m extreme poor Nigerians, by collectively pursuing honest and value adding borrowings and schemes.

Dr Nnaemeka Onyeka.