N1.1trn Anchor Borrowers’ Conundrum And Tinubu’s Fight Against Hunger
By Gidado Ibrahim
Last week’s mind boggling revelation by the Department of State Services (DSS), that several staff members of the Central Bank of Nigeria (CBN) allegedly aided in the theft of public funds through the federal government’s Anchor Borrower Programme (ABP) established under former President Muhammadu Buhari climaxed the new level of state plunder.
It is so sad that despite President Bola Ahmed Tinubu’s efforts to alleviate poverty, curb hardship and wipe out corruption within so that Nigeria can earn more respect, both nationally and internationally, some state governments are challenging the EFCC, amid the lingering case of N776 billion fraud. What a shame!
How ridiculous it is that states that receive from Tinubu government don’t want to be scrutinized by the same Tinubu administration. The president has been hailed by Nigerians for judiciously following the legal battles to retrieve public funds for the benefit of the Nigerians masses. Is there anything wrong with the president insisting on accountability on how monies doled out for agriculture subsidy were spent?
Nigeria is not a lone in initiating a homegrown agricultural subsidy and support programme. The Anchor Borrowers’ Programme (ABP), has faced challenges despite its good intentions. The programme aimed to link smallholder farmers with reputable companies involved in production and processing, providing loans to boost agricultural production and reduce food import bills
Food subsidies play a crucial role in supporting farmers, promoting sustainable agricultural practices, and ensuring global food security. The United States, European Union, India, China, and Brazil are among the leading countries providing subsidies to their farmers.
The ambitious Anchor Borrowers’ Loan Scheme floated by the Central Bank of Nigeria to make cash available for increased agricultural production in Nigeria ran into a glitch due to the “Nigerian Factors.”
In July 2023, President Tinubu had appointed Obazee, former chief executive officer (CEO) of the Financial Reporting Council of Nigeria (FRCN), as a special investigator. Tinubu had said the special investigator would also work on a comprehensive report on public wealth currently in the hands of corrupt individuals and establishments.
On December 22, 2023, Obazee’s team submitted a report, titled, ‘Report of the Special Investigation on CBN and Related Entities (Chargeable offences)’, to President Bola Tinubu — revealing fraudulent activities and malfeasance in Nigeria’s apex bank. In the report, the special investigator’s panel accused Godwin Emefiele, former governor of the CBN, of consenting to the “unlawful removal” of $6.23 million from the vault of the apex bank’s Abuja office.
Almost a year after that, apart from Emefiele, who is under trial, all his accomplices are yet to face the music. The Borrowers’ Programme under Emefiele was wrought with corruption.
However, what should baffle any sane mind is that, since the September 18 deadline handed by Tinubu, nothing has been heard. No arrest nor prosecution.
This is despite the fact that a report by security agencies had exposed the apex bank’s subsidiary and a commercial bank in the country, which acted as intermediaries between the borrowers and the CBN, alleging that the bank fraudulently diverted the sum of N255 million, which they secured from the lender but refused to disburse to the borrowers or return to the CBN.
How long are we going to continue the old circle and expect the country to be better? Today, Nigeria faces the challenge of a hungry population, principally caused by unbearable food prices. This is despite the N1.1trn spent by Buhari’s administration to boost food availability. Some of the farmers’ groups took part in the ABP, an ambitious CBN programme to promote agricultural production, including Maize Farmers’ Association, Soya beans and Cotton Farmers’ Association.
However, findings showed that while the Maize Producers Association took a loan of N39 billion from the CBN under the ABP, it has been able to refund a total of N23 billion while Cotton farmers took a loan of N14 billion and has been able to refund N5 billion so far. The presidential deadline of September 18 is over a year now and Nigerians are yet to get feedback on how the issue was handled.
As usual with the Nigerian system, we sweep it under the carpet and move on, while those who cashed out from the programme, including politicians making noise, go home to enjoy their loots and even use the same money to create problems for the Tinubu administration. If this goes unpunished, it will certainly be an indictment on our security agencies.
Make no mistake, the Anchor Borrowers’ Programme is one the best programme that a government or an administrator can conceive. It’s just that something is fundamentally wrong with our value system and thing is a clog in governmental success. If the Anchor Borrowers’ Programme had worked and the funds were not diverted, the issue of astronomical cost of food wouldn’t have been there. The succeeding Renewed Hope administration would have focused on other sectors.
Needless to emphasise that governments worldwide implement subsidies in food production to address various socioeconomic and political objectives. Primarily, these subsidies aim to ensure food security by increasing the availability of staple crops such as rice, wheat, and corn. By providing financial support to farmers, governments can control food prices, making them more affordable for consumers, particularly low-income households.
Subsidies also serve as a vital tool for supporting farmers, helping them cover production costs and increase productivity. This, in turn, improves their livelihoods and contributes to agricultural growth, creating employment and boosting rural economies. Subsidies promote self-sufficiency by reducing dependence on food imports and encouraging domestic production.
From a social welfare perspective, subsidies protect vulnerable populations from food insecurity and malnutrition. Additionally, they can encourage sustainable farming practices and conserve natural resources, contributing to environmental conservation. Subsidies can also have political implications, as governments use them to maintain public support and stability by ensuring access to affordable food.
However, the effectiveness of subsidies is often debated. Critics argue that they can lead to efficiency and targeting issues, placing a significant burden on government budgets. Moreover, subsidies can distort market dynamics, creating dependence on government support rather than encouraging competitiveness.
To maximize their benefits, subsidy programs require careful design, implementation, and monitoring. This includes targeting specific segments of the agricultural sector, setting clear objectives, and regularly evaluating program effectiveness.
Food subsidies play a vital role in ensuring global food security and supporting farmers. An examination of the world’s top agricultural subsidy providers reveals diverse strategies to promote agricultural growth, sustainability, and farmer well-being. Here’s an in-depth look at the approaches adopted by the United States, European Union, India, China, and Brazil.
The United States leads in agricultural subsidies, primarily through the comprehensive Farm Bill. This legislation provides financial assistance for environmental conservation, sustainable agriculture practices, crop insurance subsidies, and trade promotion programs. These initiatives enable American farmers to mitigate risks, adopt eco-friendly methods, and enhance export competitiveness.
The European Union’s Common Agricultural Policy (CAP) prioritizes environmental stewardship, animal welfare, rural development, and innovation. CAP subsidies support farmers in adopting sustainable practices, promoting job creation, and enhancing competitiveness through training and research.
India focuses on fertilizer subsidies to boost agricultural production, food security, and reduce fertilizer costs for farmers. This targeted approach promotes balanced fertilizer use, contributing to the country’s agricultural growth.
China’s agricultural subsidies aim to improve productivity, efficiency, irrigation systems, and fertilizer use. Additionally, China supports rural development and poverty reduction initiatives, recognizing the critical role agriculture plays in its economy.
Brazil’s agricultural subsidy program offers low-cost loans for sustainable practices, rural development, infrastructure support, and research innovation. This multifaceted approach encourages Brazilian farmers to adopt environmentally friendly methods, driving agricultural growth and competitiveness.
These countries demonstrate the significance of agricultural subsidies in ensuring food security, supporting farmers, and promoting sustainable agriculture practices. Their diverse approaches offer valuable lessons for other nations seeking to strengthen their agricultural sectors. Nigeria can borrow a leaf from these countries who have through targeted efforts ensures food security for their population.
However, the success of this beautiful programme will depend on the length we are ready to go to fight mismanagement and corruption in our system.
Conclusively, for Nigeria’s Anchor Borrowers’ Programme or others like it to succeed, President Tinubu must take a firm stance against corruption and mismanagement. The EFCC and ICPC must investigate those saddled with the responsibility of implementing the programme. The programme’s good intentions have been marred by monumental manipulations and blatant corruption, with staff members of the CBN allegedly aiding in the theft of public funds.
By addressing corruption and implementing a well-designed subsidy program, Nigeria can ensure food security, support farmers, and promote sustainable agriculture practices. The success of the Anchor Borrowers’ Programme depends on the government’s willingness to fight mismanagement and corruption.
God bless Nigeria!