Nigerian Credit Agency Gives $373 Million to Boost Crop Exports

LAGOS (Capital Markets in Africa) – Nigeria’s state-owned agricultural-lending facilitator said it disbursed $373 million to farmers in the past year to help boost production of export crops.

Known as Nigeria Incentive-Based Risk Sharing System for Agricultural Lending, or Nirsal, the agency underwrites risk for credit going to farmers, part of the efforts by the oil-rich country to increase revenue from farm exports and reduce its dependence on hydrocarbons.

The credit beneficiaries are mainly small-holder farmers growing cotton, rice, oil palm, cassava and corn, Nirsal Managing Director Aliyu Abdulhameed said in a phone interview from Abuja, the capital.

“At average yield of 4 tons per hectare, these optimized small-holder farmers’ production would generate a gross output of about 16 million tons,” he said. Revenue from the exports are expected to reach 1.6 trillion naira ($4.4 billion) by the end of this year, according to Abdulhameed.

Set up in 2012, Nirsal works with banks to guarantee as much as 75 percent of loans to agriculture. Oil-dependent Nigeria is increasing efforts to diversify its sources of export income after a plunge in crude prices from 2014 triggered the country’s worst economic contraction in 25 years in 2016.