Connect with us
nairametrics
UBA ads

Business News

How State Governments will become richer without FAAC allocation

Kebbi State announced in August that the state generated a revenue of N150 billion from the sale of its local cultivated rice in 2017.

Published

on

Agricaulture, Kebbi, FAAC, IGR

If the Nigerian agricultural sector is to be properly developed, then, the Federal Government may need to halt the monthly Federation Account Allocation Committee (FAAC) disbursements distributed to the 36 state governments and Abuja.

This is the view expressed by the Vice President of Nigeria Agribusiness Group (NABG), Mr Emmanuel Ijewewe, in an exclusive chat with Nairametrics, during an agro stakeholders’ conference, Meet the Farmers Conference, held at the Intercontinental Hotel, in Lagos. The event was organised by Crenov8 Consulting and tagged “The Future of Agribusiness”.

UBA ADS

Allocations made State Governments lazy

According to him, the development of the Nigerian agricultural sector depends not on the Federal Government (who has no land for farmers), but on the State Governments. However, most of the 36 states are not ready to develop their agricultural sector, due to the monthly revenue allocation they receive from the federation account. The ‘cheap’ revenue has made them complacent because the monthly allocation seems like a windfall to the states since it is not generated by them.

However, if the Federal Government decides to halt the distribution of revenue allocation, the second-tier governments will have no choice than to focus on how to improve their Internal Generated Revenue (IGR), in order to survive. This drive will force them to support farmers to boost their produce and generate revenue, in order to make the farmers taxable.

He explained

GTBank 728 x 90

“Many of the state governments are still getting too much from the Federal Government, if you wipe that out, when they go in for their IGR, they will help farmers to put themselves in a position where they will be making profits and, therefore, able to pay tax.”

How the Government can improve agriculture

Meanwhile, governments can help farmers in several ways, in order to boost their produce and make them profitable for taxation.

  • Little knowledge or information to the farmers can make a whole lot of difference in their production outputs.
  • Governments can invest in the construction of greenhouses to protect agricultural produce and multiplies them.
  • The government should make agricultural funds accessible to farmers easily through agencies like Nigerian Export-Import Bank (NEXIM Bank), Bank of Agriculture (BoA), etc.
  • Agricultural and farm inputs like fertilizers, tractors etc can be subsidised by governments at various levels, so as to assist peasant farmers, who may not be able to afford these necessary inputs, at the beginning of planting season.
  • Governments should make available technology-improved seedlings, hybrid breeding, hybrid seeds etc.

Kebbi State as an example

There is a popular saying that, “if you give too much money to your children, they may not go far in life.” That seems to be the situation with many State Governments, who despite the availability of arable lands suitable for several agricultural products in their domains, still prefer to look away and focus on their meagre monthly allocation from Abuja.

No one could have believed that Kebbi State has the potential to generate N150 billion from rice cultivation alone. The Kebbi State Governor announced in August that the state generated a revenue of N150 billion from the sale of its local cultivated rice in 2017. Meanwhile, data from the National Bureau of Statistics reveals that Kebbi received FAAC allocation was only N40.08 billion from January to December 2017.

onebank728 x 90

Land is the true wealth

The above research has shown that, the true wealth of each state in Nigeria is the farmers. State Governments need to realise this fact, in order to harness the huge potentials in the agricultural sector and subsequently increase their IGR.

If Kebbi State can generate N150 billion from the sale of locally cultivated rice in one year, then, states like Benue and Plateau regarded as the food baskets of the nation with more fertile lands can generate more; only if their governments can focus on the development of the agricultural sector.

According to NBS, agriculture contributed 22.86% to Nigeria’s real Gross Domestic Product (GDP) in the second quarter of 2018. If states want to fully harness the huge wealth deposited on their lands, they need to return to the era where agriculture was the mainstay of each region’s economy, contributing over 50% to their GDP.

app
GTBank 728 x 90

As at now, there are about 14 million cows in Nigeria, but we still import 96% of the milk we drink. With 14 million cows, Nigeria has no excuse for not having enough milk processing factories, to process milk for local consumption and exportation. Agricultural opportunities should be maximised to create wealth.

Patricia
Click to comment

Leave a Reply

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Coronavirus

Nigerian Governors who have tested positive for Coronavirus 

Six Nigerian governors have contracted the novel coronavirus, but some have recovered.

Published

on

On Saturday, July 4, Ebonyi State Governor, David Umahi announced that he had tested positive for COVID-19. This makes him the 6th Governor to have tested positive for the virus that has infected over 11 million and killed no less than 532,000 people globally. 

Governor David Umahi of Ebonyi State

UBA ADS

Kaduna State Governor, Nasir El- Rufai was the first governor confirmed to have been infected and recovered in April. 

Governor Nasir el-Rufai of Kaduna State

Bauchi State Governor, Bala Mohammed, was also infected in March and was reported to have recovered on the 9th of April. 

GTBank 728 x 90

Governor Bala Mohammed of Bauchi State

Oyo State Governor, Seyi Makinde, announced that he tested positive on 30th, March, 2020 and his recovery was reported on the 5th of April. 

Governor Seyi Makinde of Oyo State

onebank728 x 90

Ondo State Governor, Rotimi Akeredolu, tested positive last week on June 30th and Delta’s Ifeanyi Okowa announced that he and his wife had tested positive on July 1. 

Governor Rotimi Akeredolu of Ondo State

Governor Ifeanyi Okowa of Delta State

app
GTBank 728 x 90

So far, the governors who have tested positive for COVID-19 are:    

1. Nasir el-Rufai

2. Bala Mohammed

3. Seyi Makinde

4. Rotimi Akeredolu

app

5. Ifeanyi Okowa

6. David Umahi

 

Earlier this weekend, Benue State Governor, Samuel Ortom announced that his wife, Mrs. Eunice Ortom, their son, and some of the wife’s aides had tested positive for COVID-19.

With Nigeria and the rest of the world still battling to contain the dreaded virus, the total number of confirmed cases has risen to 28,167 from 148,188 tests carried out as at Saturday, July 4, 2020. In addition, while 11,462 have recovered, 634 persons have died.

 

Patricia
Continue Reading

Energy

BUA cement to build power and cement plants in Adamawa state

BUA Cement’s newest plant in Sokoto is expected to be operational in 2021.

Published

on

NPA Decommissioning of Port Harcourt Terminal: We'll vigorously defend, protect our rights - BUA Group, NPA and BUA Group dispute to affect 1000 jobs, $500,000 monthly revenue, Terminal closure: BUA clears air on NPA’s claims , Forbes 2020 world’s richest rankings released: Only 4 Nigerians make exclusive billionaires list

BUA Cement has announced plans to build a 50 megawatts power plant and 3 million metric tonnes cement plant in Lamurde and Guyuk local governments in Adamawa States.

BUA Cement which is Nigeria’s second-largest cement producer by volume with plants in Sokoto and Edo States, with the projects wants the boost the country’s power supply and increase the local production capacity for cement.

UBA ADS

This was disclosed by the Chairman of BUA Cement, Abdul Samad Rabiu, in a press statement on Sunday, July 5, 2020, in Lagos.

The BUA Cement Chairman who led the company’s management team on a courtesy visit to the Adamawa State Governor, Ahmadu Umaru Fintiri, after preliminary findings showed that Guyuk and Lamurde areas had quality limestone.

According to Rabiu, “Preliminary findings show that the two local governments of Guyuk and Lamurde are reputed to have good quality limestone deposits and BUA Cement is ready to begin the investment in the state.

GTBank 728 x 90

“BUA will use new technologies to supply power to the proposed cement plant and communities of Guyuk and Lamurde in addition to providing three thousand direct and five thousand indirect jobs.

“Guyuk Cement Plant will be a major investment in the North-East by BUA, while we solicit the support of Gov. Umaru Fintiri to set up the factory in Guyuk.”

READ MORE: 10 fantastic things Aliko Dangote has done in the last 10 years

onebank728 x 90

He added that while the company has invested billions of dollars in various sectors across Nigeria, it has taken a decision to source its raw materials locally and therefore urged the Adamawa state government to support BUA to actualize the GUYUK Cement project.

The Adamawa State Governor, Ahmadu Fintiri, in his response assured the Chairman and management team of BUA, that the state government would provide all the necessary support and make available whatever was needed to make the projects a reality.

BUA Cement’s newest plant in Sokoto is expected to be operational in 2021 and expects that its total production capacity will get to 14 million metric tonnes of cement per annum upon the completion of Guyuk Cement Plant.

app
GTBank 728 x 90

BUA Cement has been having a running battle with Dangote Cement over the ownership of 3 mining sites in Obu and Okpella in Edo State. The mining sites have been subject of legal tussle between the 2 biggest cement companies in the country.

 

Patricia
Continue Reading

Coronavirus

GSK, Sanofi to agree $624 million deal with UK for COVID-19 vaccine

Both GSK and Sanofi said that they are placing more priority on quality rather than speed.

Published

on

GSK, Sanofi to agree $624 million deal with UK for covid-19 vaccine

British and French pharmaceutical giants, GlaxoSmithKline (GSK) and Sanofi are close to reaching a $624 million (500 million pounds) deal with the United Kingdom (UK) government for the supply of 60 million doses of coronavirus vaccine as many countries move for possible COVID-19 treatments.

Reports suggest that the UK was considering an option to buy the vaccine should the human trials, which are due to commence in September 2020, turn out successful.

UBA ADS

The funds would be paid in stages as the vaccine progresses, with the final payment made on delivery.

In order not to be left behind, the UK government has been engaging a wide range of companies both at home and abroad to negotiate access to vaccines. They said that the right announcements of these arrangements will be made as and when agreements with any of these companies are finalized.

The British business ministry’s spokeswoman, who confirmed that the ministry is handling Britain’s supply of potential COVID-19 vaccines, said talks were going on with different parties about access to possible vaccines but didn’t confirm if GSK/Sanofi project was one of them.

GTBank 728 x 90

READ MORE: Pfizer’s COVID-19 vaccine shows positive results

According to the ministry official, ‘’The Government’s Vaccines Task Force is actively engaging with a wide range of companies both in the UK and abroad to negotiate access to vaccines.”

“Appropriate announcements of these arrangements will be made as and when agreements with any of these companies are finalized and signed.

onebank728 x 90

Sanofi is presently working on 2 possible COVID-19 vaccines, one of which uses an adjuvant made by GSK to potentially boost its efficacy. The timeline for its clinical trials is behind the likes of Moderna Inc, the University of Oxford in collaboration with AstraZeneca Plc and an alliance of BioNTech and Pfizer Inc, whose projects all made headlines by moving to human trials as early as March.

Both GSK and Sanofi said that they are placing more priority on quality rather than speed in developing a vaccine.

 

app
GTBank 728 x 90

Patricia
Continue Reading