NIRSAL, MECA Flag off National Repair and Maintenance Scheme for Tractors, Other...

NIRSAL, MECA Flag off National Repair and Maintenance Scheme for Tractors, Other Agric Equipment

*50,000 TRACTORS LYING UNUSED ACROSS NIGERIA

*NIGERIA NEEDS 10,000 TRACTORS ANNUALLY FOR THE NEXT DECADE

 

In line with its mandate to enable the transformation of Nigerian Agriculture by making impactful interventions at critical points of the agricultural value chain, the Nigeria Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL PLC) has initiated a unique national scheme to maximize and sustain the value of new and old agricultural equipment across the country.

NIRSAL is partnering with the Machine and Equipment Consortium Africa (MECA) on the project which is known as Agricultural Machine Repair, Maintenance and Management Service Scheme for Sub-National Governments. The National Agency for Science and Engineering Infrastructure (NASENI) is also part of this partnership.

In terms of expected impact, the project has massive positive implications if realized. Among other expected benefits, it will contribute to reducing the huge gap that currently exists between the country’s need for agricultural mechanization and current capacity.

For instance, the country needs 10,000 tractors annually for the next ten years to achieve significant mechanization but what is available is a far cry from this.

If the additional capital of N120 billion required to meet the target of 10,000 tractors per year is met, it will lead to a tremendous expansion of available mechanized land nationally by 3.6m hectares and enable the production of about 14.4m metric tons of grain. In monetary terms, this translates to about N1.44 trillion in value.

The new scheme will complement other on-going efforts by NIRSAL to fix the mechanization component of primary production. NIRSAL has an on-going partnership with various deposit money banks to guarantee over 300 tractors to be given to farmers on a fee-for-service basis.

A key objective of the new scheme is to end the colossal waste of billions of Naira which was invested in acquiring agricultural equipment that are gathering dust all over the country and deploy them to boost agricultural production.

It is estimated that there are about 50,000 disused tractors and other equipment in different parts of the country.

Speaking at the launch of the scheme at NIRSAL Headquarters on Thursday, November 9, 2017, the Managing Director of NIRSAL, Mr Aliyu Abdulhameed lamented this sad state of affairs and asserted the determination of NIRSAL and its partners in the project to end this waste in order to boost agricultural modernization and productivity in the country.

 

 

"Every state has a tractor hiring and maintenance agency in the agriculture ministry. But as anyone who has visited these sites can attest, the tractors and other agricultural equipment which are vital components for the transformation of Nigerian agriculture are gathering dust because of simple problems that could be fixed and put back to provide service to farmers. Research shows that an average tractor goes into disuse barely 9 months after purchase due to lack of maintenance.'

"Through the decades, different tiers of government and private sector investors in agribusiness have made investments in tractors and other related agricultural equipment to aid agricultural mechanization. However, the trend is that they do not take long to fall into disuse."

The NIRSAL MD stated that the failure to maintain agricultural equipment is especially sad because the country currently falls short of what it needs to achieve significant and sustained agricultural mechanization.

Quoting World Bank data, the MD reported that the average number of tractor per 100 sq.km of arable land in Nigeria is a paltry 6.8 compared to 26.9 in Kenya and a world average of 195.3. Studies indicate that the country needs a minimum of 10,000 tractors each year for the next ten years to sustain the level of production needed to transform the sector.

Mr. Abdulhameed further explained that the new scheme will ensure "an effective, business-driven system that ensures that agricultural equipment are properly maintained, repaired by well trained professionals and managed using the best possible techniques to elongate their lifespan".

According to the terms of partnership, NIRSAL will provide credit risk guarantees and technical advisory support services to enable commercial financing of the project while NASENI and MECA will be responsible for refurbishing and managing the equipment to generate the required cash flow.

The sub-nationals (state and local governments) would be targeted to enroll in the scheme which would also be opened to the private sector subsequently.

MECA has a solid track record as a global platform for full utilization and optimization of excess machine and equipment that are either underutilized, idle, redundant or decommissioned.

 

Innocent Azebeokhai

Head, Corporate Communications

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