CBN renews support for agriculture sector with N100bn funding

Business a.m

The Central Bank of Nigeria (CBN) has earmarked N100 billion to purchase 2.5 million bags of fertilisers for distribution to farmers as part of its funding intervention for the agricultural sector aimed at increasing the availability of agricultural inputs and addressing the pressing issue of food security in Nigeria.

In a statement, Olayemi Cardoso,the CBN governor, stated that the investment in the agricultural sector would have a positive impact on food production and reduce inflation, which has reached 29.9 percent. 

Addressing a group of stakeholders at the fertiliser handover event, which took place at the Ministry of Agriculture and Food Security, Cardoso highlighted the importance of maintaining price stability in the fight against inflation. He noted that food prices are a key component of overall inflation in Nigeria, where households spend a significant portion of their income on food and non-alcoholic beverages.

According to Cardoso, the short-term outlook for inflation remains uncertain, with food inflation being a major contributing factor. While the CBN is implementing various measures to curb inflation, the governor acknowledges that it may take time for these efforts to have an impact. In the meantime, he highlighted the need for immediate action to address food prices and support households struggling to cope with rising costs.

He stated: “This is precisely why we convened today- to strengthen our collaboration with the Ministry of Agriculture to mitigate the surge in food prices. 

In alignment with our strategic shift towards focusing on our fundamental mandate, the CBN has veered away from direct quasi-fiscal interventions and transitioned towards leveraging conventional monetary policy tools for executing monetary policies effectively.”

Cardoso stressed the importance of collaboration between the CBN and relevant government agencies in addressing food inflation. He noted that the CBN’s initiatives alone cannot solve the complex challenges of food production and distribution. Therefore, he stated that the bank will work closely with MDAs, such as the Ministry of Agriculture and Food Security, to coordinate efforts and leverage each other’s expertise.

“Consequently, we aim to enhance our partnership with the Ministry of Agriculture, bolstering your endeavours to enhance food productivity and security, ultimately curbing food inflation and fortifying our pursuit of price stability,” he added.