The Central Bank of Nigeria, on Wednesday, delivered N100 billion worth of fertilisers to the Federal Ministry of Agriculture and Food Security to enhance food production across the country.
CBN Governor, Olayemi Cardoso, transferred the 2.15 million bags of fertilisers to the Minister of Agriculture and Food Security, Abubakar Kyari, at the headquarters of the FMAFS in Abuja.
During the handover ceremony, Cardoso mentioned that one of the main responsibilities of CBN was to maintain stable prices, emphasizing that the cost of food was a crucial part of inflation.
The CBN boss explained that this was because a significant part of household spending in Nigeria goes towards food and non-alcoholic drinks.
Cardoso stated, “This emphasizes the critical need to address food inflation as a crucial aspect of managing overall headline inflation rates.”
He clarified that while the CBN had been implementing various measures to control inflation in the short term, the inflationary pressures had remained largely driven by rising food prices.
However, he noted that while temporary inflationary pressures may persist, the government expects significant relief by the third quarter of 2024.
“This is why we are gathering today to strengthen our collaboration with the Ministry of Agriculture with the shared goal of mitigating the surge in food prices.
“In line with our shift towards focusing on our fundamental mandate, the CBN has moved away from direct quasi-fiscal interventions and shifted towards using conventional monetary policy tools for implementing monetary policies.
“In this context, we aim to expand our support and build closer relationships with ministries, departments, and agencies that have the mandate and expertise to carry out these crucial initiatives,” Cardoso stated.
He also mentioned that “as a result, we aim to strengthen our partnership with the Ministry of Agriculture, thereby supporting your efforts to increase food productivity and security, and ultimately, reducing food inflation and strengthening our pursuit of price stability.
“In pursuit of these goals, we are pleased to announce the allocation of 2.15 million bags of fertiliser valued at over N100 billion, which we are respectfully handing over to the Ministry of Agriculture.”
Before Cardoso became CBN governor in 2023, the apex bank intervened in the fertiliser market in Nigeria mainly by facilitating access to credit through programs like the Agricultural Credit Guarantee Scheme and the Commercial Agricultural Credit Scheme.
Through these programs, the CBN encourages banks to lend to farmers at concessional rates. This helps farmers to buy fertilisers and other inputs.
The apex bank also supports farmers through indirect subsidy by making credit more affordable, as its interventions can lead to effectively lower fertiliser prices for farmers.
Kyari described the cost of fertiliser as the major input in any agricultural production, and praised the apex bank for providing the commodity.
Details to be provided later.
