AfDB Grants Nigeria New $200 Million Loan to Support Wheat and Rice Farmers
The Board of Directors of the African Development Bank Group has officially approved a substantial $200 million loan aimed at bolstering Nigeria's agricultural sector. This financial injection is designated for the second phase of the National Agricultural Growth Scheme–Agro-Pocket (NAGS-AP), a strategic initiative to enhance food security and economic growth.
Funding Details and Programme Focus
According to a recent statement from the Bank, this funding will be channeled into scaling up critical agricultural investments. The primary objectives include improving productivity, strengthening value chains, and promoting climate-smart, data-driven farming practices across Nigeria. The approval follows an earlier financing package under the African Emergency Food Production Facility, highlighting a continued commitment to agricultural development.
The new loan will directly support the implementation of five key programmes outlined in Nigeria's National Agricultural Technology and Innovation Policy (NATIP). These programmes are designed to address various challenges in the sector:
- Improving access to quality agricultural inputs such as seeds and fertilizers.
- Strengthening value chains for priority crops like wheat and rice.
- Revitalizing extension services to provide better support to farmers.
- Promoting digital and climate-smart agriculture technologies.
- Enhancing agricultural data management systems for informed decision-making.
Project Goals and Expected Impact
The intervention prioritizes raising staple crop production by increasing farmers' access to climate-resilient, high-yield seed varieties and fertilizer blends suited to local conditions. Additionally, it plans to expand crop insurance coverage to protect farmers from climate-related risks, such as droughts or floods.
As part of its ambitious targets, the project aims to increase wheat production fivefold and raise rice output by 20%. These goals are set to support national food self-sufficiency and reduce dependency on imports. The initiative also seeks to encourage young Nigerians to expand cultivated land and adopt more commercially oriented farming practices, fostering innovation and entrepreneurship in agriculture.
Building on Previous Successes
Dr. Abdul Kamara, Director General of the African Development Bank for Nigeria, emphasized that the second phase builds on the strong outcomes recorded under Phase One of the programme. "Building on the strong results achieved under Phase 1, this second phase draws directly from those lessons and successes to scale up impact even further," Kamara stated.
He added that expanding access to quality inputs, digital tools, and climate-smart technologies will help farmers improve productivity and resilience, while contributing to lower food imports and inclusive economic growth.
Under Phase One, the programme introduced an ICT-based system that enabled the distribution of seeds, fertilizers, and pesticides through more than 600 agro-dealers nationwide. The first phase also supported the cultivation of 118,000 hectares of wheat during the 2023/2024 dry season, increasing national wheat output to an estimated 0.5 million metric tonnes in 2024. In total, about 650,000 smallholder farmers producing wheat, rice, cassava, maize, sorghum, and millet have benefited from the initiative so far.
Challenges and Broader Context
Agriculture remains a major pillar of Nigeria's economy, employing about 38% of the workforce and contributing 25.2% to the country's Gross Domestic Product (GDP). However, the sector continues to face significant challenges, including limited access to quality inputs, weak land tenure systems, inadequate irrigation, climate change impacts, and soil degradation.
The four-year project is scheduled to begin in March 2026. The Bank noted that the initiative aligns with its broader strategy to empower young people and women across Africa through improved access to technology and financial support.
Related Government Initiatives
In a related development, the Federal Government of Nigeria is providing interest-free loans to 22,000 eligible farmers through the FarmerMoni scheme. Farmers can secure up to N300,000 without collateral, promoting economic stability in rural areas. This credit scheme, implemented under the Renewed Hope GEEP 3.0, aims to enhance food security and reduce poverty through financial inclusion and support for agriculture.
