The Federal Government is partnering with military-linked investment institutions to provide security for large-scale agricultural investments and restore investor confidence in areas affected by insecurity.
The initiative is expected to help unlock, among other agriculture projects, multibillion-dollar soybean and sugarcane projects in Yobe and Jigawa states, where security concerns have made it difficult to attract the capital needed to develop them.
The Ministry of Finance Incorporated (MOFI), Integranium Holdings, and the Defence Agricultural Assets and Projects Development Company (DAPCO), supported by Defence Holding Company Limited, are working together to create a framework that combines investment mobilisation with security and project management.
MOFI’s Executive Director of Investments and the official responsible for the Integranium investment framework, Dr. Femi Ogunseinde, said the partnership would enable the institutions to return to prospective investors with a security arrangement designed to protect their investments.
He said security had been one of the major obstacles preventing domestic and international investors from committing funds to large-scale agricultural projects in Nigeria.
‘We have a soybean initiative in Yobe, we have a sugarcane initiative in Jigawa-all large-scale, all multibillion-dollar projects,’ Ogunseinde said.
He explained that attracting investors had been difficult without assurances that their money and agricultural operations would be protected.
‘Without having that security anchor to ensure that whatever comes from wherever to invest, the investments are safe, it becomes very difficult for us to do anything,’ he said.
Ogunseinde said the new partnership would provide a platform through which the government and its partners could approach prospective investors and demonstrate that arrangements were being developed to address their security concerns.
He said the initiative was intended to attract substantial private-sector and international financing into agricultural production, rather than depend solely on public funds.
The agreement is expected to cover risk management, security planning and project management, with DAPCO working alongside MOFI and its investment partners to develop and implement agricultural projects.
The Chairman and Chief Executive Officer of DAPCO, Aliyu Abdulhameed, said the defence establishment’s role was to ensure that financing reached agricultural opportunities in rural areas under secure and properly structured arrangements.
He explained that agricultural investments often take place far from major urban centres, making security a critical consideration for investors.
The partnership, he said, would enable the institutions to combine their respective strengths to develop agricultural projects across the country.
Ogunseinde said the partners had already identified several opportunities and expected at least one project to break ground before the end of the year.
He did not identify the project or give a specific commencement date.
The partners are expected to assess each project individually, considering its financial viability, investment potential, due diligence requirements and value for money before proceeding.
Beyond the immediate security arrangements, the initiative is designed to attract investment into Nigeria’s vast agricultural resources and increase the country’s capacity to produce food for domestic consumption, industrial use and export.
Ogunseinde said an estimated 30 million to 35 million hectares of land could be available for farming, providing considerable scope for expanding large-scale agricultural production.
He said the partnership would help create a platform for investors interested in developing that potential, including companies and financiers from outside Nigeria.
The aim, he explained, was to achieve scale by bringing together land, capital, agricultural expertise and the security arrangements needed to support commercial farming.
Although Ogunseinde discussed the possibility of attracting investments worth $1 billion to $2 billion, he did not present the amounts as funds already committed to the partnership.
There were no words on the total investment value of the broad agreement.
The Group Managing Director of Defence Holding Company Limited, Air Vice Marshal A. V. Ndache, said the memorandum of understanding signed by the institutions was a broad agreement covering agriculture, hospitality and other investment areas.
He said more detailed agreements would be developed for the individual projects as the partnership progresses.
Ndache said the initiative was intended to benefit Nigeria by improving national productivity, adding that food security was a priority for President Bola Tinubu’s administration.
The Managing Director of MOFI’s investment partner said the agricultural initiative was also expected to help address food inflation by increasing the volume of food produced locally.
Dr. Armstrong Takang said Nigeria needed to make better use of its land, water resources and people to produce sufficient food for households and industries, while generating additional supplies for export.
He said the partnership would focus on developing bankable agribusiness opportunities capable of attracting funding from both public and private investors.
The projects are expected to support large-scale agricultural operators and encourage more investment across the farming value chain.
Takang also said the initiative could create additional demand for fertiliser supplied through MOFI’s holdings and produced by Nigerian companies.
He referred to PFI NPK, the Fertilizer Aggregation Company, as one of the businesses that could benefit from an expanded market for agricultural inputs.
He said increased agricultural activity could create a larger market for fertiliser and help improve soil productivity, leading to higher food production.
The initiative is also expected to extend economic opportunities to communities around the farms. Abdulhameed said surrounding communities would be involved in projects established in their areas, allowing the benefits of investment to spread beyond the immediate farm operations.
He added that serving military personnel and veterans, particularly those from the armed forces, would be among the groups the partnership intends to involve in agricultural projects.
The partners also plan to use technology, innovation and improved farming skills to increase productivity and make better use of available land.
Ogunseinde after the signing, said insecurity had affected farming operations and contributed to the abandonment of some farmlands, limiting the country’s ability to produce all the food it needs locally.
He said a successful programme would see a substantial share of food production coming through the partnership’s projects.
Agriculture was estimated by the speaker to contribute between 25 and 27 per cent of Nigeria’s gross domestic product. He said expanding production could strengthen the sector’s contribution to the economy while improving food security.
The initiative also aims to produce agricultural goods that meet the requirements of both domestic and international markets, potentially opening more opportunities for exports.
But the partners have yet to state specific production targets, the number of hectares to be cultivated under the programme, the number of jobs expected to be created, or the total funding required.
The memorandum of understanding establishes the broad framework for cooperation, while individual projects will have to undergo further assessment and structuring before their implementation.
The partners said details of the projects would be made public as they become ready for rollout.