Nigeria partners Morocco on agric insurance to boost diversification

EMEKA EJERE|
Nigeria and Morocco last week raised a steering committee to develop a sustainable crop insurance scheme for the country in a move expected to boost agriculture and economic diversification.
Agricultural insurance premium financing is one important but neglected area government ought to pay attention to in its efforts to boost food production in the country.
The administration of former President Goodluck Jonathan, demonstrated its determination to boost food production in the country through its agricultural transformation agenda (ATA).
To accommodate as many farmers as possible in the scheme, the government registered about 10 million farmers under its Growth Enhancement Scheme, an aspect of the ATA and pledged to ensure that all farmers in the country were captured in the scheme.
At a regional mechanisation stakeholders’ sensitisation workshop in Kaduna, the government had said its intention was to use the Agricultural Transformation Agenda to move agriculture from a development project to a profitable business venture.
Along this line, it put up various intervention programmes, the most prominent being a bush clearing intervention programme for farmers with about 6,000 hectares of farm land earmarked to be cleared across the country as a way of assisting farmers who had difficulties in that area.
These efforts were geared towards boosting agric production in the country.
Unfortunately, in all these, the Goodluck Jonathan regime had no policy on agricultural insurance to secure agricultural produce which has been a major challenge in developing the sector.
The then minister of Agriculture and Rural Development, Dr. Akinwunmi Adeshina, in spite of his achievements in enhancing agricultural activities in the country, did not give much attention to agricultural insurance.
Indeed, agric insurance, among Nigerian farmers, has remained very unpopular despite the menace of climatic change in Nigeria in recent times.
In the year 2012, the experience of many Nigerians on the menace of flood had left indelible mark on many families as houses and farmlands were washed away by floods.
The effect on food production and food pricing in the country had left many families under the threat of hunger and starvation up till date, as prices of foodstuff especially staple foods like gari, yam and beans have hit the roof top. In 2015, tomato pests ravaged most of the crops for that year drastically affecting its supply.
This was because farmers suffered great losses without any form of compensation because many of them did not insure their farms.
At one of the National Economic summits held in Abuja, Economists had expressed the views that the promotion of agricultural insurance among farmers was a major factor that would enhance large scale food production worldwide as well as reduce prices of food.
Agricultural insurance all over the world has become as prominent in public discourse as conventional insurance. This is due to the adverse effects of global climate change on food production in different countries, which is costing the world several billions of dollars annually excluding loss of lives.
The development is also fast retrogressing progress in the global struggle for food security and individual country’s sufficiency in food production including Nigeria.
At micro level, periodic losses by farmers on account of natural disaster like flood, has left them at various stages of poverty that some lacked the least capital to continue farming even at domestic scale after each year’s natural disaster.
The situation was worsened by lack of insurance cover by the farmers, which would have helped to cushion the effects of such losses on the farmers and reposition them to remain in business.
The Nigeria/Morocco Committee comprises representatives of the Nigerian Agricultural Insurance Corporation (NAIC), Bank of Agriculture, the Moroccan Agricultural Insurance Company (MAMDA) and MAMDA RE.
In developing the insurance scheme, “the committee is expected to use parametric products and leverage on the Moroccan model for crops covering selected areas of between 5000 and 10,000 hectares of land.”
The Managing Director of NAIC Mrs. Folashade Joseph, who disclosed this in Abuja at the inauguration of the committee said the establishment of the committee was another step by government towards boosting agriculture as an alternative revenue earner for the country “given the volatile nature and uncertain future of oil which was until now the mainstay of the economy.”
With the growing challenges posed to agriculture by climate change, she said there was need for Nigerian farmers to accept climate smart agriculture and embrace agricultural risk management.
According to Joseph, NAIC would continue to develop partnership agreements and collaborate with international partners to develop and deploy insurance products that will help in managing emerging risks.
The NAIC Chief Executive traced the new initiative to the visit of King Mohammed VI of Morocco to Nigeria in December 2016, during which he and President Muhammadu Buhari initiated 15 bilateral agreements on trade, agriculture as well as the oil and gas sector between the two countries.
As a follow up to that, she said that NAIC last month paid a working visit to MAMDA RE in Morocco to further activate the terms of the agreement and to understudy the Moroccan experience in the development and deployment of Area Yield Index Insurance products.
Joseph recalled that the Bank of Agriculture (BOA) had been NAIC’s strongest partner for over 30 years and assured the bank of NAIC’s continued support in the provision of risk management services to agricultural investors and farmers financed by BOA.
She also assured BOA of prompt payment of claims to farmers on its insurance platform as well as the development of new insurance products and services to manage the peculiar risks of the agricultural sector.
In his remarks, the Managing Director, Bank of Agriculture, Alhaji Kabiru Mohammed said although his bank and NAIC had enjoyed a good relationship over a long time, there were new developments that made it important for them to strengthen the partnership to facilitate the realisation of the objections of the federal government in repositioning agriculture.
Mohammed said emerging realities in the country had made it an imperative to change the mindset of farmers from the thinking that farming was no more than a traditional occupation.
He said there was big money in agriculture but that those engaged in it must do it properly and strategically if they want to make profit.
The BOA Chief Executive said there was need for his bank and NAIC to partner in collective marketing and information sharing.
He said the bank was already looking beyond government intervention and was discussing with international development partners and investors as a way of boosting agriculture in the country.
Mohammed said the inauguration of the committee was part of the effort towards internationalising the existing collaboration among the relevant stakeholders in the sector.