The Federal Government has launched a $1 billion sugar pipeline and a N10 billion fund aimed at achieving self-sufficiency in sugar production, according to a statement from the Ministry of Agriculture and Food Security. The initiative is part of the National Sugar Master Plan (NSMP) to reduce the country's reliance on imported sugar.
What the $1 Billion Pipeline Entails
The $1 billion pipeline represents the total investment required to develop the sugar value chain, including cultivation, milling, and refining. The government says the investment will be sourced from private sector players, development partners, and the proposed N10 billion fund.
The N10 billion fund, to be managed by the Bank of Industry (BoI), will provide low-interest loans to sugar farmers and processors. According to the Minister of Agriculture, Abubakar Kyari, the fund is designed to "unlock the potential of the sugar sector and ensure that Nigeria becomes a net exporter of sugar in the near future."
Current Sugar Production and Import Dependency
Nigeria currently produces about 1.5 million metric tonnes of sugar annually, but domestic demand stands at 1.7 million metric tonnes, leaving a deficit of 200,000 metric tonnes that is met through imports. The country spends over $600 million annually on sugar imports, a figure the government aims to eliminate.
The NSMP, which was introduced in 2012, has a target of producing 2.5 million metric tonnes of sugar by 2026. The new pipeline and fund are expected to accelerate progress towards this goal.
Impact on Farmers and Local Economy
The initiative is expected to create over 100,000 jobs across the sugar value chain, particularly in rural areas where sugarcane farming is prevalent. The government also plans to provide training and improved seedlings to farmers to boost yields.
According to the Minister of Agriculture, the fund will also support the establishment of new sugar mills and the rehabilitation of existing ones. "We are committed to ensuring that the sugar sector contributes significantly to the nation's GDP and provides sustainable livelihoods for our people," Kyari said.
The announcement comes as the government seeks to diversify the economy away from oil dependence. The sugar sector is seen as a key pillar in this strategy, given its potential for backward integration and import substitution.
The Ministry of Agriculture has indicated that the first disbursement from the N10 billion fund is expected within the next three months, with priority given to smallholder farmers and cooperatives.
