The politicization of the revival of the merchant pyramid: testimony from a beneficiary
BY AMIN AHMED
About 70% of the Nigerian population is employed in the agricultural sector. It is therefore logically strategic for the government to emphasize the economic growth of the sector. It is a fact that agriculture is an engine of economic growth thus justifying the huge investment of the central bank in the sector. CBN’s numerous intervention programs across the value chain of approximately 21 commodities are what has driven the increase in productivity as well as the development of the agricultural value chain over the past five years. And indeed, Tiamin Rice is a testament to the success of the reinvigorated functional agricultural system in Nigeria; thanks to the commitment and resilience of the central bank governor and his team.
Central bank intervention, which is driven by the apex bank’s development finance policy, is driven by recognition of the critical role that agriculture plays in economic growth and development. These include the food supply of the population, the supply of raw materials for the non-agricultural sector, the creation of employment, the supply of surpluses to be invested in the form of savings and taxes, as well as foreign exchange earnings through exports. This highlights the importance of agriculture to Nigeria’s economic growth and hence the need for increased investment in the sector by the CBN.
Data from the Food and Agriculture Organization of the United Nations (FAO) shows that over the past five years, Nigeria has produced more rice than at any time since the return of democracy in 1999. FAO data shows that between 2014 and 2019, Nigeria retained the top spot. place among rice producers in Africa with an average of 7 million metric tons. This alone is proof that we are on the right trajectory to achieve self-sufficiency in rice production in Nigeria. It is recognized that the above efforts have contributed to increasing the contribution of the agricultural sector to the gross domestic product (GDP) of the country. According to data from the Nigerian Bureau of Statistics (NBS), the sector’s contribution to GDP increased from 19.79% in 2015 to 22.35% in the first quarter of 2021. So far, 2.9 million farmers in total benefited from the PBA covering 3.6 million hectares of land growing 21 agricultural products.
Before 2015, we had around 13-15 standard rice mills in Nigeria. After the launch of PBA, the hectares of land cultivated for rice doubled by more than 200%, which attracted more investors, and currently, we now have more than 50 standard rice mills in the country. From 2015 to 2020 no less than 250 micro, small, medium and large integrated rice mills have emerged; across the country, while many existing rice mills are improving their capacities. Once again, Tiamin Rice testifies to this fact.
As for the high price of rice on our markets which seems to have defied the laws of supply and demand despite the increase in production, it should be noted that world food prices have reached their highest level for more than a decade, increasing by more than 30% last year according to the Food and Agriculture Organization of the United Nations (FAO). Therefore, the price increase is not exclusive to Nigeria, the prices of all other food products in the world have increased by around 30% in 2021.
In 2016, our company decided to invest in agro-ally by establishing an integrated rice mill with a daily capacity of 320 metric tons in Kano. Within four years, we benefited from the Paddy Aggregation Scheme (PAS) and two other Central Bank of Nigeria intervention schemes and successfully repaid these loan facilities. Within three years, with the proceeds from our rice production, we were able to increase our production capacity with a brand new integrated rice mill with a daily capacity of 600 metric tons in Bauchi State. Without CBN’s intervention programs, Tiamin would not be what it is today.
It was only recently again under the CBN intervention program that we secured funding for our 10,000ha irrigation farm at Udubo in the Gamawa LGA of Bauchi State. under the Private Sector-Led Accelerated Agricultural Development (P-AADS) program to boost private sector food staples. production, industrial raw materials and supporting food security, job creation and economic diversification. The clearing and leveling work on the 10,000 ha farm has reached significant heights. Cultivation of the farms will result in the production of approximately 75,000 metric tons of paddy. This, by extension, will increase the total paddy production capacity in the country by 1.78%. Benefiting from numerous CBN intervention measures, we will be able to increase the annual capacity of our factories to 331,200 metric tons within a few months. This makes our company the largest rice mill in all of Nigeria. This is all due to CBN’s intervention program.
When fully operational, our two rice mills will directly employ over 600 permanent workers and 900 casual workers. While the 10,000 ha Udubo farm is expected to employ around 1,000 direct employees with over 100,000 people who will earn a living along the rice value chain from our rice mill and irrigation farm of 10,000 ha in Udubo, Bauchi State.
Meanwhile, as part of our corporate social responsibility, Tiamin Rice Limited has spent N450 million on the construction of a new police hospital in Kano and two model primary schools in Bauchi State. The Sarauniya Zabi Model Primary School and a primary school located on our farm for neighboring Fulani villages near our farm. Again, we could not have given back to these communities without CBN’s involvement. It is therefore quite curious for us after achieving such appreciable feats in five years to hear political wholesalers react to the display of one million pyramid-shaped bags of rice in Abuja as a scam. Obviously, this is a sponsored media smear campaign to discredit the successes recorded through CBN intervention programs in the agricultural value chain of various commodities.
We therefore want to urge the CBN, RIFAN and even other agricultural commodity associations to continue working together to make our country self-sufficient in food production under the PBA to revive our economy. Moreover, the Rice Millers Association of Nigeria, which is now one of the biggest beneficiaries of the CBN-anchored PBA as purchasers of the product, should have the courage to challenge and debunk the negative insinuations. circulating on the Abuja rice pyramid as a lie. . Let it be recorded that our company (Tiamin Rice) was allocated 20,000 bags of rice out of the million bags of paddy that made up the pyramid and let it be known that the remaining 980,000 bags of rice have since been awarded to other members of our association across the country.
In conclusion, we call on RIMAN not to allow politicians to spoil the valiant initiatives that have achieved successful achievements, on which the future of our country depends. Such resounding development policies that can turn our country around for our common good must be encouraged and supported by all well-meaning citizens of this country. It is time for the Rice Millers Association of Nigeria to speak out and put an end to this matter.
Ahmed is the GMD/CEO of Tiamin Rice Ltd.