Mr. Philip Yila Yussuf is the Director, Development Finance Department, Central Bank of Nigeria. In this interview, he speaks on why the apex bank is vigorously championing the Anchor Borrower Initiative for farmers across the country and why the intervention focuses more on rice value chain.
The story of the current rice revolution in the country is incomplete without mentioning the contributions and support of the Central Bank of Nigeria (CBN). Why is the CBN involved in the rice sector?
If you look at Section 31 of the CBN Act, it allows us to carry out development financing and the banks’ involvement in such development finance activities is really aligned with the strategic mandate of ensuring price and exchange rate stability.
So, food prices, unemployment are key indices of the macro economy, and food price inflation, for example, contributes a significant chunk of the basket in tracking total inflation.
So inflating this development through sustainable finance or other such options that will deliver very affordable and accessible credit, will really enhance the banks’ ability to deliver on its primary mandate which I said earlier was ensuring price and exchange rate stability.
And rice is a major staple food in Nigeria, widely being consumed. It consumes a significant part of our import bill, a lot rice importation in the last few years before we started this intervention and it can be really described as the significant import index for food security.
So, the bank’s interest is to really develop local production capacity which would do a couple of things to drive productivity, to boost employment because small holder farmers are going to be involved in this. Ultimately and very important for us, it will conserve foreign exchange requests that we normally have for rice importation.