Anchor borrowers programme as another government bonanza
• AFAN Incorporates Clerics To Lobby Defaulters
• Other Potential Beneficiaries Of Similar Loans Will Be Affected
• CBN May Blacklist Kano
Two years after it was launched by President Muhammadu Buhari on November 17, 2015, in Birnin Kebbi, Kebbi State, the Central Bank of Nigeria’s Anchor Borrowers’ Programme (ABP), appears to have served as another government bonanza to the agricultural sector. By the last count, about 218, 000 farmers from across the federation are benefitting from the N45.5billion scheme (money released through 13 participating financial institutions), which involves 233, 000 hectares of farmland, where eight commodities, namely rice, wheat, maize, cotton, soya-beans, poultry, cassava and groundnuts are being cultivated, in addition to fish farming.
The production of one million metric tons of paddy rice is part of efforts to ensure self-sufficiency in rice production.Among other things, the initiative is also meant to create economic linkages between the over 600, 000 smallholder farmers, and reputable large-scale processors, to raise agricultural output and improve capacity utilisation of integrated mills.
While it is touted as one of the most successful CBN development finance interventions to date, and also deemed to have so far achieved reasonable success, especially in the areas of outreach and coverage, the failure of most of the farmers in some states to repay their loans running into billions of naira, appears to have effectively signaled the commencement of the collapse of the initiative.
Buhari in a nationwide broadcast to mark the country’s 57th independence anniversary described the programme as a success.Only last month, the CBN revealed that it has formed strategic partnerships with agricultural commodity associations to expand the implementation of the ABP.
Its acting Director of Corporate Communications Department (CCD), Isaac Okorafor, who made the disclosure said, “the CBN is forming these partnerships to further ramp up the domestic production of identified commodities by leveraging the existing organised structures of the agricultural associations nationwide, thereby providing huge economics of scale in the implementation of the programme.”
He added that the strategic partnership had begun to yield results with the commencement of the Rice Farmers Association of Nigeria (RIFAN) ABP with the Bank of Agriculture, where about 300, 000 rice farmers across 20 states would be supported during the upcoming dry season farming.
The apex bank spokesman disclosed that an additional two million metric tonnes of paddy rice was expected to be produced under the dedicated RIFAN ABP, adding that all registered agricultural commodity associations could key into this strategic partnership, by simply approaching any of the Participating Financial Institutions (PFI) collaborating with the CBN in the implementation of the programme.
Be that as it may, since the ABP took off, the attitude of some beneficiaries, most of whom have bluntly refused to repay the loans has become a source of concern to many stakeholders, who fear that this singular action could send the wrong message to groups, both local and international, that would have loved to come up with further intervention to strengthen the sector.
While some farmers are alleging that conditions for the loan’s repayment were quite stringent, some are said to be of the view that there was not enough enlightenment campaign to intimate farmers that the loans were repayable; hence some of them saw it as a reward for voting for President Muhammadu Buhari in 2015.
KANO State remains a classic example of the gross failure of farmers to repay the loans they got to better their practice, raise agricultural output and eradicate poverty among them.That perhaps explains why the state government last Sunday disclosed plans to set up mobile courts to try over 4, 500 farmers that have defaulted so far.
Earlier this year, at the expiration of the timeline for the loan for the 2016 farming season, where about 12, 000 farmers, growing rice, maize and soybeans participated, the Kaduna State government took a similar step to retrieve the loan from defaulters.The government effort yielded little dividend as only about 22 per cent of the loan in commodity value, as agreed by the farmers before the facility was disbursed, was recovered.
From the total sum of N950million loan released by the CBN to Kano State rice farmers, only a paltry N6million has been paid back till date.The development has not only posed a serious threat to future disbursement, as there is likelihood of the bank blacklisting the state, it has also created fears that the majority of the farmers in other states might not refund the loan.
According to the state Chairman of All Farmers Association of Nigeria (AFAN), Faruk Rabi’u Musa, out of 5, 540 rice and wheat farmers that secured the loans, not up to 50 of them have repaid. Before unfolding plans to set up mobile courts, the Managing Director of Kano Agricultural and Rural Development Authority (KNARDA), Professor Mahmoud Daneji, irked by the attitude of the defaulting farmers, said a Product Monitoring Team (PMT) had been set up to recover the loans.
Daneji told The Guardian that the nine-man PMT recovery committee, which he chaired, has representatives from the CBN, Bank of Agriculture and the RIFAN.
The KNARDA boss further explained that the PMT Committee was expected to visit the defaulting farmers in all the 44 local councils, so as to facilitate the repayment within the stipulated period.He lamented that, “Out of 5, 540 farmers that collected the loan during the wet season, only few have so far repaid it. This is the reason the loan was not given for the dry season farming.
“The farmers have up to the end of harvesting season to pay the loans, else government will go ahead to recover the loans through legal means,” Daneji said.As chairman of the team, he said, the defaulting farmers had December 2017 deadline to refund the loans, “…as there is no concrete reason they are failing to pay. An excuse that the loan was given to them when it was too late, was nothing more than a flimsy excuse.”
The AFAN chairman, Musa, who doubles as the state chairman of Wheat Farmers Association, said the development forced them to set up a task force to see to the loan recovery.
“Our fear is that when farmers refuse to service their loans, the repercussions will not be on the defaulting rice farmers alone, other potential beneficiaries of similar loans will definitely be affected, like wheat farmers, tomato growers and the like. So we must stand up and see to the end of this unhealthy development,” he said.
“I am afraid if the CBN will again consider our farmers for any agriculture loan in future, if the money is not recovered,” he stated.Musa, who explained that his association intervened in stages said, “Our first stage was to create awareness for the rice farmers to understand why it is necessary for them to pay back without further delay. Under this, we also urged our Islamic clerics to kindly remind people of the obligatory demand of paying back loans when collected from a source. It is indeed unIslamic for anybody to take a loan and refuse to pay at the agreed time,” said Musa.
“The second stage was the taking of the recovery campaign to the clusters used in releasing the loans. This was followed by the third and the last option for the CBN and us.”When the second stage was exhausted, we had no other option than to take the defaulting farmers to face legal action. They must comply, if not they will definitely face the music.”Another perspective given by the AFAN chairman was the notion by farmers that government was just giving out bonanza to citizens, like some other similar schemes.
“Some of them, in my opinion, think they were given the money as a reward for their voting President Muhammadu Buhari to power. If that is not their thinking, why don’t they give a damn about paying back their loans? I always tell them that what was given to them must be paid back, no matter what. They should know that there is nothing like bonanza in this special scheme from the CBN,” Musa warned.The state chapter of RIFAN, however, accused the PMT of sabotaging the rice segment of the scheme.
According to RIFAN chairman, Abubakar H. Aliyu “We are behind on Anchor Borrowers Programme, compared to all participating states.”Their excuse is that our members did not repay the loan they collected for the wet season, but they have forgotten that the loan was given in September 2016 when the rainy season was almost over.”
While the state government blames the farmers’ association for defaulting, the association claimed that even the state’s instituted Product Monitoring Team, was not helping matters between CBN and them.A source close to the farmers’ body alleged that, “When the CBN wanted to give out the loans to us, all rice millers like Dangote and others refused to stand as guarantors. The state government then, stood in for us as our guarantors. And just look at what is happening now.”
A reliable source, however, informed The Guardian that, if the farmers fail to service the loan at the expiration of the deadline, the CBN could try to get the money from the state’s allocation or other avenues. It is the realisation that this could come to pass that the state government has perfected plans to take the over 4, 500 defaulters before a mobile court.
AFAN chairman, Musa, who spoke on Sunday said the state government was toeing this line as the last option to recover the loans.He said the association has been directed to compile the list of all defaulting farmers with a view to submitting it to the state government for necessary action.“The state government will assist the association with police, judges and other staff because it served as a guarantor to the farmers.“We want to change the attitude of some people, who think that the loan is a national cake because they should have paid by April. It is unfortunate that less than 10 per cent of farmers who benefitted from the loan have so far paid the loan,” Musa said.He pointed out that the task force set up by the association to recover the loans was not given the necessary support and cooperation by the defaulters.
KEBBI State, where at least 78, 000 farmers benefitted from the loan is another state, where the programme is facing hitches, owing to the failure of benefitting farmers to repay their loans.Back in May 2017, some of the 5, 968 defaulters were apprehended in Bagudo Local Council and sentenced to different prison terms by a mobile magistrate’s court presided over by Mukthar Tarifiki.
The court, which worked hand in glove with the recovery team led by the state Deputy Governor, Col. Samaila Dabai (rtd.), sentenced the defaulters at its sitting in the council area. The sentencing was on the fifth visit to the council by the recovery team, which at that time had also visited Suru Local Council on three occasions to compel defaulting farmers to repay their loans, without success.
Even the intervention of the district head, Alhaji Muhammadu Bello, which led to defaulters in Suru council being given a period of grace, failed to get them to reciprocate the gesture by paying up. With 11, 549 Suru Council has the highest number of beneficiaries that have defaulted in the payment. That perhaps explained why Dabai expressed displeasure at the attitude of the loan beneficiaries, just as he assured them that government would do everything legitimate to recover the loan.
In October, Governor Atiku Abubakar Bagudu further advised the loan beneficiaries to pay back what they owe in order to ensure continuity.The governor, who gave the advice in an interactive session with newsmen, after the Independence Day broadcast said, “For anybody, who does not to pay back the loan after harvest should be ready to face the wrath of the law.”He added that the loans, through the Bank of Agriculture (BOA) and others were insured to avoid losses on the side of the benefitting farmers.
IN Kaduna State when some of the 12, 000 farmers across three crops (including maize rice and soya beans), who took part in the wet season farming failed to remit what was expected of them, the state government said it would set up mobile courts to recover the N4 billion loan given them.The Commissioner for Agriculture and Forestry, Dr Manzo Maigari, who made the disclosure, said that the courts would try defaulters to ensure a full recovery of the loans from them, even as it had gone ahead to intimate divisional police officers across the state to support it in the recovery efforts.He explained that the policemen would be attached to the off-takers, including Flour Mills and Olam, to ensure 100 a per cent loan recovery before the timeline for the loan elapsed.
Maigari later confirmed in an interview that, “farmers have not been up to date in remitting farm produce as part of the terms and condition for the programme. The wet season Anchor Borrowers’ Programme covered the rainy season farming programme, and we were able to capture about 12, 000 farmers across three crops including maize rice and soya beans with a total of about N4 billion.
“You know it was for wet season farming. It is expected that when they harvest, they will surrender the produce to the off-takers. So far, some off-takers have started aggregating their produce though we have some farmers that are trying to play smart; we have some farmers that are reluctant to release the produce, bringing one excuse or another. No excuse is good enough because, farmers sign MoUs with the off-takers, they also sign MoUs with their banks, inputs were given to them, money for labour was given to them, so there is no excuse,” he was quoted as saying.
OF the N2billion disbursed to benefitting farmers in Delta State, only N100million has been repaid.This development was described by the Asaba Branch Controller of the CBN, Dame Elizabeth Agu as pathetic, adding that efforts were being made to recover the loans.The Guardian reliably learnt that some farmers in the state have either shown no commitment, or were unwilling to repay the loan at all.
However, one of the beneficiaries, Mrs. Divine Amegor said: “We are not satisfied with the system of getting the loans, even the loans could not been used for what they were meant for, it is all like a mystery.” Other farmers, who spoke to The Guardian on condition of anonymity, alleged that the loans procedures were tedious, adding that payments conditions were also too stringent for them to meet.
An investigation further revealed that many of those, who obtained the loans, diverted the funds into other ventures, and were currently finding it difficult to repay.But Dame Agu insists that those, who diverted them into other ventures would be made to repay the loans at all cost.
WHERE farmers are not failing to repay the loans they got on or before the due date, they are alleging the failure of the programme in their states owing to political interferences.This is the case in Cross River and Adamawa states. In Cross River State particularly, farmers have described the scheme as a colossal failure, as most of them could not access the funds to enable them to acquire more land.
They accused the state government of politicising the scheme, maintaining that even the inputs, including fertilisers that were distributed did not go round, and since the farmers did not get cash to procure more land, the rice could not be planted and the fertiliser not optimally used.
According to them, the Ultra Modern Rice Mill in Ogoja, that was to be ready in December to roll out the first batch of rice in December 2017, as promised by the state governor, Ben Ayade, is still under construction. Added to this, is the frustration of farmers, who are still managing with their local mills in Bansara and Ogoja.
However, managers at the site of the rice mill said the mill would now be ready in April 2018. Faced with various challenges, rice farmers during a fact-finding tour of the rice mill and farms by journalists in the state recently, called for a rollover of the scheme from 2017 to 2018, to allow the farmers access the funds.
THE same scenario recently played out in Adamawa State, where the immediate past chairman of the National Association of Rice Farmers in the state, Abdullahi Tafida, predicted that the implementation of the ABP in the state would soon collapse.Tafida, who is the acting secretary, North East Zone of the association, told reporters that in Yola, that due to political interests and improper implementation, the programme was going to fail.He also alleged that the state government had politicised the scheme to the extent that genuine farmers were not being captured.
“The problem is the way and manner the project is implemented in the state, because it looks like there is so much political and personal interests in it.“Most of the beneficiaries are political sympathisers, who have nothing to do with farming. In fact, they have started selling the agricultural inputs given to them to the marketers,’’ Tafida had alleged.
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