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Nigerian company partners with DFI and BII

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By Mercy Kelani

Investment will promote development in Africa's agricultural industry.

A $26.5 million partnership has been signed by AFEX, a Nigerian commodities trading platform, the United Kingdom’s development finance institution (DFI) and the British International Investment (BII) to assist small-scale farmers across Africa. BII stated that the investment will be used to promote structural developments in the agricultural industry that is in Africa. Hence, the investment will enhance food security efforts and support small-scale farmers. The investment will also entail launching and development of a soybeans processing plant in Nigeria south-western state, Ibadan, in 2025.

Also, the investment will be implemented towards constructing 20 modern warehouses in countries like Uganda, Kenya and Nigeria, as stated by the UK firm. The warehouses will be used along with AFEX’s warehouses, which are more than 200 in the aforementioned countries. BII is optimistic that the fund will also avail next-generation software and warehouse technology that targets post-harvest pricing. It was stated that there is potential in smart storage solutions for preservation of the lifespan of harvested crop.

It will increase the incomes of the farmers by over 200 percent.

Additional warehouse, according to the investment company, will generate 230,000 MT of storage capacity which will equip about 200,000 farmers to have access to low-cost storage and maximization of sales from crop harvest. Significantly, it will increase the incomes of the farmers by over 200 percent. BII announced that it is vital to assist small-scale farmers to attain a fair wage. This is to guarantee that the farmers remain in operation and ensure production of higher quality crops for local consumption.

According to BII, agriculture in Uganda, Kenya and Nigeria is accountable for a quarter of GDP and ensures employment of 70 percent of their populations, of whom 80 percent are subsistence and small-scale farmers. Currently, due to poor reliability on sales from crop harvests, limited market access and macroeconomic uncertainty, farmers encounter a difficult financial outlook. Consequently, incomes of farmers are greatly affected by the extreme weather events and inflation of the prices of agricultural inputs, even as yields have fallen.

State of emergency on food security was declared by Nigerian President.

More so, the development of a soybean processing plant in the third-largest city by population in Nigeria, Ibadan, and the construction of a drying facility in Uganda will be initiated through the capital. The impact investment firm hopes to see the soybeans and storage processing facilities yield more than 80 permanent roles and 700 temporary jobs. 25 million Nigerians were projected by the United Nations Children’s Fund (UNICEF) to likely experience hunger around June and August this year if measures are not taken.

The World Bank announced that 64 million Nigerians are in danger of emergency nutritional and food assistance as a result of the effects of increasing inflation of prices of goods, climate change, and many more factors. Thus, a state of emergency on food security was declared by President Bola Tinubu on July 13 this year. Owing to the declaration, the national security council (NSC) purview of matters included concerns of essential livelihood items, affordability and availability of water and food. According to the federal government, savings that were generated from petrol subsidy removal will be used to revamp the agricultural sector.

Agricultural productivity in Nigeria will be enhanced by investment.

However, the declaration of a state of emergency on food security was viewed as a restatement of the vulnerability of Nigeria’s food ecosystem by some experts. The British deputy high commissioner in Lagos, Jonny Baxter, restated that the investment will bolster food security and support agricultural productivity in Nigeria. Baxter said that agricultural sector takes a vital position in the economy of the country, acting a major role in investment potential and job creation. BII’s chief executive officer, (CEO), Nick O’Donohoe, stated that Africa’s food import bill was estimated by the World Bank to have reached $30 billion.

Related Link

British International Investment: Website

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