NSSP-IFPRI participates in a Strategy and Planning Workshop for the Knowledge Management (KM) Framework and System for the Agricultural Transformation Agenda (ATA)
Dr. George Mavrotas, NSSP-IFPRI Program Leader, was invited to participate in the main panel discussion for the Strategy and Planning of the Knowledge Management (KM) Framework for the Agricultural Transformation Agenda (ATA). The event, held on March 18, 2015 in Abuja, was jointly organized by the Nigerian Federal Ministry of Agriculture and Rural Development (FMARD), United Nations Development Programme (UNDP), the Bill and Melinda Gates Foundation (BMGF) and the World Bank. Mr. Francis Neuman, Knowledge Management Advisor, UNDP RSC-ESA, launched the four-day workshop by reiterating the value addition that KM brings to the ATA. Firstly, it serves to strengthen the ATA systematically through the KM System management and infrastructure components and secondly through its application - increasing access to information, impact on policy development, innovation and learning.
Dr. Mavrotas participated in a roundtable discussion with key stakeholder groups focusing on ways to create awareness to enable a clear direction on the importance and modalities for developing and implementing the KM Framework, System and Action plan. This is a key area of the ATA as it shapes a KM Framework that will clearly reflect stakeholder needs and accurately define the major principles and mechanisms by which ATA stakeholders will be guided while implementing the change process. The event was a follow up on the October 2014 conference, and in which Dr. Mavrotas presented on behalf of IFPRI-NSSP a white paper on the policy lessons emanating from other countries in this area, and on the identified capacity development needs in order to ensure that the goals of the ATA will be fully achieved.
The key stakeholder groups represented at the Panel Discussion were from the Ministry of Agriculture (Mr. Emebinah Ebuka, Consultant, Phillips Consulting Limited), Farmers Organization (Mrs. Lizzy Igbine, Nigerian Women Agro-Allied Farmers), Research Organizations (Dr. George Mavrotas, NSSP-IFPRI), the Agribusiness Private Sector (Mr. Daniel Udo, Agribusiness and Investment) and the Development Partners (Ms. Alefia Merchant, USAID Agriculture Development Officer). The discussion was moderated by Mr. Steffen Janus (Senior Operations Officer, Knowledge Hubs, World Bank). IFPRI expressed its commitment towards the direction of promoting data collaboration with competent access for sharing acquired data across the KM System. It was also stressed that the involvement of the Agricultural Research Council of Nigeria (ARCN) in the implementation of the KM Framework for ATA would be important as it can play a key role in strengthening the Nigerian agricultural research system.
New Publication: The Political Economy of Food Price Policy in Nigeria in Food Price Policy in an Era of Market Instability: A Political Economy Analysis
The Nigeria Strategy Support Program (NSSP) is pleased to announce the publication of The Political Economy of Food Price Policy in Nigeria by NSSP Senior Economist/Consultant, Aderibigbe Olomola, as a chapter in Food Price in an Era of Market Instability: A Political Economy Analysis edited by Per Pinstrup-Andersen, and recently published by the Oxford University Press.
About this book: Food price volatility is one of the major challenges facing current and future global food systems. Since 2006, global food prices have fluctuated greatly around an increasing trend and price spikes were observed for key food commodities such as rice, wheat, and maize. The full or partial transmission of these global food price changes to individual developing countries, together with domestic food price changes, caused by domestic factors such as extreme weather events and market disruptions, caused governments to respond in a variety of ways. While there is ample description of the nature, content, and causes of food price fluctuations during the last 5 to 7 years, very little is known about the processes that led to policy responses or the relative power and behaviour of the participating stakeholder groups. Understanding how and why governments responded as they did is important to enhance the existing knowledge of the political economy of food price policy and to assist governments in their policy-making as they confront future food price fluctuations. This book presents results from political economy studies of food price policy in 14 developing countries as well as the United States and the European Union.
New Publication: Communities’ Perceptions and Knowledge of Ecosystem Services: Evidence from Rural Communities in Nigeria
The Nigeria Strategy Support Program (NSSP) is pleased to announce a new publication from the International Food Policy Research Institute's Environment and Production Technology Division entitled Communities’ Perceptions and Knowledge of Ecosystem Services: Evidence from Rural Communities in Nigeria by Wei Zhang, Edward Kato, Prapti Bhandary, Ephraim Nkonya, Hassan Ishaq Ibrahim, Mure Agbonlahor, and Hussaini Yusuf Ibrahim as the 1418th publication of the IFPRI Discussion Paper Series. The IFPRI Discussion Paper was published in February 2015.
Abstract: This research has been undertaken to improve our understanding of stakeholders’ knowledge and perception about ecosystem services (ES), which provides a valuable means of gaining insight into the opportunities and constraints that face ES management in a multiuser landscape. Land use preferences are influenced by a variety of motives, attitudes, and values intrinsic to every individual’s decisionmaking. Knowledge can affect attitudes and behavioral intentions, and a positive attitude toward the environment has been found to predict conservation practices. Using primary data collected from a village survey of 102 villages in Nigeria between November 2012 and February 2013, this study assesses local communities’ awareness, perceptions, and knowledge of a broad range of ES and examines the key factors that explain the variations in the level of awareness across communities, with a special focus on land uses within landscapes. We found that exposure to forest and lowland floodplains was positively correlated with people’s level of awareness of ES, highlighting the importance of direct experience and local context in shaping people’s perceptions toward ES. Such considerations should be taken into account when designing policies aimed at addressing natural resources and environmental management issues. While provisioning services were generally well recognized, consistent with findings of previous studies, a majority of the sampled villages also appreciated spiritual values as a cultural service. Communities’ awareness and knowledge about regulating and supporting ES were generally very low, including those services that are important for maintaining the stability and productivity of agroecosystems (for example, pollination and biological pest control), warranting a greater role for agricultural extension to play in influencing community levels of awareness of ES in Nigeria. Furthermore, incorporating new concepts and topics about ES into the primary school curriculum will better educate people about the importance of ES. Finally, our assessment of communities’ attitudes toward payments for environmental services suggests a need to respect local communities’ preferences, norms, and traditions when designing policies that encourage natural resources management.
NSSP-IFPRI contributes to the FMARD High-Level Policy Dialogue on Nutrition Sensitive Agriculture in Nigeria
The Nigeria Strategy Support Program (NSSP) of the International Food Policy Research Institute (IFPRI) was invited to speak at the High-Level Policy Dialogue on Nutrition Sensitive Agriculture in Nigeria held on March 17, 2015 in Abuja, Nigeria. The event, organized by the Nigerian Federal Ministry of Agriculture and Rural Development (FMARD), engaged influential stakeholders and development partners from Nigeria’s agricultural industry, representatives of international organizations, the donor community, NGOs and the civil society, in order to focus on the nation’s agricultural and nutrition policy. In particular the event’s main objective was to drive a high profile advocacy effort to raise the profile of nutrition sensitive agriculture and shape agricultural policy efforts that would enhance nutrition in Nigeria, and to create a shared understanding and engage international expertise and best practices on nutrition transformative agricultural policies and programmes.
As part of the above event, Dr. George Mavrotas, NSSP-IFPRI Program Leader, was invited to give a presentation on the key findings and policy lessons emanating from the Global Nutrition Report (GNR) 2014 published by IFPRI in November 2014. The presentation reflected also on key statistics from the GNR, such as that malnutrition accounts for 45 percent of global child death and that a 16 to 1 return exists on nutrition investments. These were cited by the Honorable Minister of Agriculture and Rural Development, Dr. Akinwunmi Adesina, as clear signs of the need to mainstream nutrition into agriculture. The event highlighted inter alia the need for improving data on nutrition to provide ancillary benefits such as the creation of indices for Nigerian states to measure performance on key public nutrition programme efforts to meet the needs of malnourished individuals and to improve the health and economic security of low-income families. It was also stressed that access to more accurate data may improve policies and practices that would expand the reach of federal nutrition programs.
In addition, Dr. Mavrotas was a panelist in the main panel on Nutrition-Transformative Agriculture Policy which included the Honorable Minister of Agriculture and Rural Development, Dr. Yaya Olaniran (Ambassador and Nigeria’s Permanent Representative to the United Nations Food and Agriculture Orgarnization (FAO), World Food Programme (WFP) and the International Fund for Agriculture and Rural Development (IFAD) in Rome), Ms. Ada Osakwe (Senior Investment Advisor to the Honorable Minister of Agriculture and Rural Development), Professor Paul Amaza (Vice Chair of the Agricultural Transformation Agenda Policy Working Group), Ms. Emmy Simmons (Global Panel on Agriculture, Food Systems and Nutrition), and was moderated by Ms. Ndidi Nwuneli (Founder of Leap Africa). The event was concluded with the inauguration of the Interministerial Agriculture Nutrition Working Group, which included Ms. Margaret Adesugba as a member, NSSP-IFPRI Senior Research Assistant, and which was introduced by the Honorable Minister of Agriculture and Rural Development, Dr. Akinwunmi Adesina.
The Nigeria Strategy Support Program (NSSP) is pleased to announce the publication of Market Imperfections for Tractor Service Provision in Nigeria by Hiroyuki Takeshima as the 1424 publication of the IFPRI Discussion Paper Series. The IFPRI Discussion Paper was published in March 2015.
Abstract: Agricultural mechanization often accompanies agricultural transformation. In some countries in Africa south of Sahara (SSA), such as Nigeria, the mechanization process appears slow, in spite of the declining share of the agricultural sector in the economy and employment. Knowledge gaps exist regarding this slow mechanization process, and filling this knowledge gap is important in identifying appropriate policies on agricultural mechanization in Nigeria. In Nigeria, average horsepower and prices of tractors appear high, despite the scarcity of tractors. These patterns are different from the experiences in other parts of the world where initially tractor horsepower was often smaller (for example Asia), or farmers were better endowed with land and wealth (the Americas). In Nigeria, joint ownership of tractors is rare, and formal loans are often unavailable due to high transactions costs. IFPRI’s survey in Kaduna and Nasarawa states in 2013 also suggested that the spatial mobility of tractors is generally low, and uses are highly seasonal (Takeshima et al. 2014). There do not seem to be plausible explanations for the seeming dominance of large tractor use, based on the available information of the prices and soils. Nevertheless, these patterns seem driven by private sector’s own initiative rather than by governments’ policies. Indivisibility of large tractors and limited mobility of supplies may cause the imperfection in the custom hiring market. In order to distinguish the impacts of technology adoption at the extensive margin from those at the intensive margin, in the empirical analyses we tested these hypotheses focusing on the differences among marginal adopters of tractor hiring services and nonadopters of similar characteristics. The results are two-fold: (1) adoptions patterns of tractor services are partly explained by basic factor endowments, suggesting that the market for custom hiring is in some way functioning efficiently in response to economic conditions; (2) adoptions are, however, affected by supply-side factors including the presence of large farm households (and thus potential tractor owners) within the district, and (3) per capita household expenditure level differs significantly between the marginal adopters and nonadopters of similar characteristics. This difference seems to arise from the adoption per se, rather than the intensity of adoption, which is consistent with the hypothesis of the imperfection of the custom hiring market.
IFPRI’s flagship report puts into perspective the major food policy issues, developments, and decisions in 2014 and highlights challenges and opportunities for 2015. Drawing on rigorous research, IFPRI researchers and other distinguished food policy experts consider a wide range of crucial questions:
- How can middle income countries, which despite becoming more affluent are still home to the majority of the world’s hungry people, address their food and nutrition security challenges?
- What is the role of improved sanitation in shaping key nutrition outcomes, especially for children?
- How can we support smallholder farmers in “moving up” in agriculture or “moving out” of the sector altogether?
- What social protection measures help shield vulnerable people effectively and efficiently against an increasing number of shocks?
- How can we best build and regulate the capacity of actors along the food chain to tackle food safety and health risks?
- How should we address food and nutrition security of people living in conflict zones?
- What policies can support the sustainable development of the aquaculture sector as the global demand for fish skyrockets?
- What have been the major developments in regions and countries where poor and hungry people reside?
The 2014–2015 Global Food Policy Report also presents data for several key food policy indicators, including country-level data on hunger, agricultural research spending, and capacity for food policy research. In addition to illustrative figures, tables, and a timeline of food policy events during the past year, the report also presents the results of a global opinion poll on the current state of food policy.
New Publication – Determinants of Change and Household Responses to Food Insecurity: Empirical Evidence from Nigeria
The Nigeria Strategy Support Program (NSSP) is pleased to announce the publication of Determinants of Change and Household Responses to Food Insecurity: Empirical Evidence from Nigeria by NSSP Research Analyst, Hyacinth Edeh, and former NSSP Program Leader, Kwabena Gyimah-Brempong, in the African Journal of Agriculture (Vol. 10 Issue 5). The article was published on January 29, 2015.
Abstract: Limited economic and physical capacities as well as environmental and economic shocks have constrained the ability of many Nigerian households to feed themselves adequately. This has resulted in food shortages; and they had to adopt various consumption-related strategies to mitigate the effect of the shortfalls. Using the 2010/2011 Nigeria Living Standards Measurement Study-Integrated Surveys on Agriculture data and the reduced consumption coping strategy index (RCCSI), this paper examined the determinants of change in food (in)security of Nigerian households in the two major farming periods. Results showed that there were significant differences in the food insecurity status of households in the two periods. The likelihood of change in the food security status were determined by sex of the household head, farmland holdings, nature of livelihood, shocks associated with land loss, and climate change events. Coping strategies in the two periods were dietary change and rationing strategies. However, the frequency of use of these strategies was higher in the post-planting period and more among female-headed households. The use of high-yielding climate-resistant crops and reduction in post-harvest losses through processing and improved storage facilities were advocated.
The Ghana Strategy Support Program (GSSP) and the Nigeria Strategy Support Program (NSSP) of the International Food Policy Research Institute (IFPRI) held a joint retreat in Ghana from January 19-23, 2015. The retreat was attended by researchers and staff from both NSSP and GSSP along with Washington, DC based researchers that contribute to these programs. The retreat included planning days for each program, a roundtable discussion on “Agriculture, Youth and Employment” co-hosted by IFPRI and ISSER, a dissemination event on the Nigerian rice economy and value chains in Ghana, and a field visit to the Kpong Irrigation Scheme.
The Ghana Strategy Support Program (GSSP) and the Nigeria Strategy Support Program (NSSP) of the International Food Policy Research Institute (IFPRI) held a joint seminar covering two topics: 1) the rice economy in Nigeria and 2) value chains in Ghana, on January 22, 2015 in Accra, Ghana. The event was attended by members of the Ghanaian Ministry of Agriculture and Ministry of Finance, Development Partners, and other stakeholders. The event was chaired by Dr. Paul Dorosh, Division Director, Development Strategy and Governance Division, IFPRI.
Dr. Hiroyuki Takeshima, Research Fellow, IFPRI and Dr. Michael Johnson, Research Fellow, IFRPI, presented findings on the Nigerian experience from their study, “Assessing the Potential and Policy Alternatives for Achieving Rice Competitiveness and Growth in Nigeria” (a policy note is available here). A more comprehensive overview of Nigeria’s rice economy will be published in the upcoming year in the forthcoming book, Achieving Rice Self-Sufficiency in Nigeria: Options for Future Strategies and Policies, edited by Dr. Kwabena Gyimah-Brempong, Dr. Michael Johnson, and Dr. Hiroyuki Takeshima and published by the University of Pennsylvania Press. The Ghanaian experience was also presented in a presentation entitled, “Reaching Smallholders through Value Chain Development” by Dr. Shashidhara Kolavalli, GSSP Program Leader/Senior Research Fellow, IFPRI.
The Institute of Statistical Social and Economic Research (ISSER) in collaboration with the International Food Policy Research Institute (IFPRI) held a roundtable discussion on the theme Youth, Employment and Agriculture on January 22, 2015 at the University of Ghana. The roundtable discussion looked at how the agricultural sector could serve as a provider of employment for youth and the conditions necessary for youth to embrace agriculture as a profession in Ghana. Presentations were made by each of the panelists on various topics of relevance to the above theme, such as: the dynamics of the Ghanaian labor market; the perceptions and aspirations of the youth; how agriculture can provide the kind of lifestyle that usually attracts the youth to urban areas and the effectiveness of public intervention; and global best practices. The panel consisted of: Dr. William Baah-Boateng (Senior Lecturer, Economics Department, University of Ghana), Dr. Nana Akua Anyidoho (Senior Research Fellow, ISEER), Alhaji Adam Mahama (National Coordinator, Youth in Agriculture Programme), Dr. Paul Dorosh (Division Director, Development Strategy and Governance Division, IFPRI), and Dr. James Thurlow (Senior Research Fellow, IFPRI). The discussion was moderated by Professor Felix Asante (Director, ISSER).
Abstract: The credit market serving agriculture in Nigeria is encumbered by operational and administrative inadequacies and the discriminatory tendencies of financial institutions. The government has implemented policies to redress the situation, but small-scale farmers have not benefitted from these incentives to any reasonable degree. This makes it imperative to examine the factors circumscribing loan demand and the various rationing mechanisms. To this end, this study seeks to (1) examine the nature of risks facing small-scale farmer-borrowers in Nigeria, (2) analyze the demand for agricultural credit by farmers and highlight the key determinants of this demand, (3) ascertain the extent to which farmers are credit rationed and the factors influencing the emerging rationing scenarios, and (4) suggest policy measures to address the problem of agricultural credit rationing and enhance the demand for credit. The study employs primary data obtained from 1,200 small-scale farmers through a survey conducted in 2013 across the six geopolitical zones of the country. Methodologically, the study extends the analysis of credit rationing beyond quantity rationing and presents explicit econometric models for analyzing the determinants of three types of credit rationing:quantity rationing, risk rationing, and price rationing. The seemingly unrelated regression model is employed to ascertain the determinants of credit rationing. The results show that there is a higher probability that farmers will be rejected than that they will be given a loan amount lower than what was requested. We find that gender, geographical location, and marital status have no statistically significant effect on the probability that farmers will be quantity rationed. To address the credit rationing challenges and improve demand for loans by small-scale farmers, we urge banks to mobilize their resources to train potential borrowers and establish loan-monitoring committees at the grassroots level to serve as insurance against the risk of loan default.
New Publication: Business Operations of Agrodealers and their Participation in the Loan Market in Nigeria
New Publication: Irrigation Potential in Nigeria: Some Perspectives Based on Factor Endowments, Tropical Nature, and Patterns in Favorable Areas
New Publication: Analysis of Agricultural Public Expenditure in Nigeria: Examination at the Federal, State, and Local Government Level
NSSP Participates in Stakeholders’ Session Towards Finalizing the ATA Food Security and Nutrition Strategy
The Federal Ministry of Agriculture and Rural Development (FMARD) held a Stakeholders' Session Towards Finalizing the ATA Food Security and Nutrition Strategy on December 11, 2014 to update stakeholders on the progress made toward the finalization of the ATA Food Security and Nutrition Security Strategy. The goal of this session was to reengage stakeholders on key aspects of the strategy that had been developed since the National Capacity Building Workshop on Mainstreaming Food and Nutrition Security into Agricultural Policies, Programmes and Value Chains held in August 2014 and to get input on key aspects of the strategy. The session was organized by the Nutrition Transformation Value Chain (NTVC) team and coordinated by the Senior Advisor to the Honorable Minister of Agriculture and Rural Development on Food Security and Nutrition, Dr. Victor Ajieroh.
In support of FMARD's goal to mainstream nutrition into the Agricultural Transformation Agenda, Dr. Oluyemisi Kuku-Shittu, Associate Research Fellow in the Nigeria Strategy Support Program (NSSP) of the International Food Policy Research Institute (IFPRI) made a presentation entitled, "Examples of Indicators for Nutrition Sensitive Agriculture : Insights form the CFSVA study and others." The presentation highlighted key indicators identified through IFPRI research and the 2001-2003 Nigeria Food Consumption and Nutrition Survey that would need to be measured by as part of a monitoring and evaluation component of the ATA Food Security and Nutrition Security Strategy.
Good nutrition is the bedrock of human well-being. Before birth and throughout infancy, good nutrition allows brain functioning to evolve without impairment and immune systems to develop more robustly. For young children, good nutrition status averts death and equips the body to grow and develop to its full potential. Over the course of the human lifespan, it leads to more effective learning at school, better-nourished mothers who give birth to better-nourished children, and adults who are likelier to be productive and earn higher wages. In middle age, it gives people metabolisms that are better prepared to ward off the diseases associated with changes in diet and physical activity. Without good nutrition, people’s lives and livelihoods are built on quicksand.
Good nutrition is also central to the sustainable development agenda that is taking shape in the form of the Sustainable Development Goals (SDGs) now under discussion. Inherently sustaining, good nutrition flows throughout the life cycle and across the generations. It promotes individual resilience in the face of shocks and uncertainties generated by climate change and extreme price fluctuations. It supports the generation of innovations needed to meet the joint challenge of improving the lives of current and future generations in ways that are environmentally sustainable.
This Global Nutrition Report is the first in an annual series. It tracks worldwide progress in improving nutrition status, identifies bottlenecks to change, highlights opportunities for action, and contributes to strengthened nutrition accountability. The report series was created through a commitment of the signatories of the Nutrition for Growth Summit in 2013. It is supported by a wide-ranging group of stakeholders and delivered by an Independent Group of Experts in partnership with a large number of external contributors.
New Publication: Capacity Assessment for Achieving the Agricultural Transformation Agenda in Nigeria, NSSP Working Paper No. 26
Abstract: Transformation of the agricultural sector has become a development imperative for many African countries in order to achieve the Millennium Development Goals that relate to improved food security and reduced hunger. Nigeria is no excep-tion and has recently initiated its own program with this objective, the Agricultural Transformation Agenda (ATA). Lessons from transforming traditional agriculture in the past have shown that for every level of sectoral transformation, corresponding levels of organizational and individual human capacity must be attained as well. This report presents the findings and recommendations of a capacity needs assessment study carried out between July and September 2012 in the context of the ATA. In this paper, we document an approach to capacity strengthening in the Federal Ministry of Agriculture and Rural Development (FMARD) to implement the ATA. The objectives of this report include mapping key institutions and stakeholders, analyzing institutional capacity strengths and gaps, and making recommendations to improve these capacities in relation to their proposed implementation roles. This report also identifies the leadership and management structure required within FMARD for the successful implementation of the ATA. We then make recommendations to improve capacity at the policy process and organizational levels to increase the effectiveness and efficiency of FMARD. Capacity assessments were carried out at three levels: the policy process level, the organizational level, and the individual level.
NSSP Participates in the Strategic Planning Workshop for Capacity Development of FMARD (October 20-24, 2014)
In 2012, IFPRI and Africa Lead, at the request of the Federal Ministry of Agriculture and Rural Development (FMARD) and USAID, prepared a report to map the key institutions/organizations which would drive the Agricultural Transformation Agenda (ATA) and identify their capacity development needs in order to ensure that the goals of the ATA will be achieved. More importantly, this report was to set in place a structure, process and habit of thought and analysis that would lead to better designed, delivered, and measured agriculture programs in Nigeria leading to greater agriculture productivity and food security over the long run. In response to this report, FMARD conducted a five-day Strategic Planning Workshop on Capacity Development from October 20th-24th, 2014 to prepare the building blocks for a structured and prioritized five-year capacity development plan.
The Nigerian Federal Ministry of Agriculture and Rural Development in collaboration with the Food and Agricultural Organization (FAO) celebrated the 2014 World Food Day between the 13th and 16th of October with a series of activities. On October 15th, a National Agricultural Show was held in Tudun Wada, Nasarawa State to showcase agricultural products and the various endeavors of agricultural organizations and associations in furthering the development of agricultural sectors. Amongst the many organizations present were the National Veterinary Research Institute, Nigeria Institute for Oil Palm Research, National Cereals Research Institute, National Horticultural Research Institute, National Agricultural Extension and Research Liaison Services (NAERLS).
The International Food Policy Research Institute (IFPRI) alongside the International Fertilizer Development Centre (IFDC) held a joint exhibit at the event. Nigeria Strategy Support Program's (NSSP) Senior Research Assistant, Motunrayo Oyeyemi, informed attendants on IFPRI's mission to provide research-based policy solutions that sustainably reduce poverty and end hunger and malnutrition and NSSP's aims to: 1) enhance knowledge through information, data, and tools for the analysis, design, and implementation of pro-poor, gender-sensitive, and environmentally sustainable agricultural and rural development polices and strategies in Nigeria; 2) strengthen the capacity of government agencies, research institutions, and others to carry out and use applied research for agricultural and rural polices and strategies; and 3) improve communication between policymakers, policy analysts, and those who benefit from agricultural and rural development policy. In addition, Dr. George Mavrotas, Program Leader of NSSP, and Dr. Yemisi Kuku-Shittu, Associate Research Fellow, attended the 2014 World Food Day Symposium held in Abuja.
The Nigeria Strategy Support Program (NSSP) is pleased to announce the publication of Determinants of Agro-Dealers’ Participation in the Loan Market in Nigeria by Professor Aderibigbe Olomola, Senior Economist/Consultant for NSSP in the International Food and Agribusiness Management Review (Vol. 17 Issue. 3). The publication was published in September 2014.
Abstract: Agro-dealership financing deserves policy attention if agro-dealers are to contribute to the success of the ongoing agricultural transformation in Nigeria. Thus, this study seeks to (i) examine the issues influencing the decisions of agro-dealers to participate in the loan market, (ii) analyze the demand for business loan by the agro-dealers and (iii) articulate policy measures for sustainable financing of agro-input business enterprises in Nigeria. The study employed primary data collected through structured questionnaires from 300 agro-dealers and used a Tobit type-II model for the analysis. The results show that interest rate, debt, value of asset, membership of trading association and source of credit are major determinants of loan demand. Agro-dealers need to organize themselves into input trading associations to enhance their creditworthiness and unleash the inherent social capital and information advantages for improved agro-dealership financing. Moreover, diversification of product coverage by agro-dealers and a value-chain approach that links internal financing in the form of trade credit within the agro-input sector with external financing from the commercial banks are strongly recommended.