Fintiri Launches N5.1 Billion ADAS Credit Guarantee Scheme
In a landmark move for Adamawa State, Governor Ahmadu Umaru Fintiri has officially inaugurated the Adamawa Agribusiness Support (ADAS) Programme Credit Guarantee Scheme, a monumental venture valued at five point one billion naira.
The ADAS Programme has been painstakingly designed to take advantage of the state’s tremendous agricultural potential for the socio-economic development of the populace and the growth of the Internally Generated Revenue (IGR) of the government, according to Governor Fintiri, who officially launched the programme on Thursday at the Banquet Hall of Government House Yola.
With roughly five million residents and lush agricultural expanses, a growing livestock industry, agriculture is the state’s economic backbone. Despite this, agricultural practices have predominantly lingered at subsistence levels, characterized by limited capital infusion and a largely unorganized market structure.
He added that the government hired a consultant whose services resulted in the creation of the ADAS Program since it is the administration’s goal to change the narrative by making the state economically stronger through agriculture.
The ADAS Programme was established as a result of this resolve, which was a strategic undertaking supported by seasoned experts.
Emphasizing the gravity of the Credit Guarantee Scheme, Governor Fintiri clarified,
“Let me also state that the Credit Guarantee letters that are being issued today are not meant to provide free lunch to the beneficiaries, but a business undertaking that provides security to their respective banks to enable them access credit.”
He further elucidated that the implementation would unfold in phases, initially encompassing aggregators and marketers, before progressively extending to encompass primary agricultural production and even non-agricultural ventures.
Acknowledging the prevailing hardships faced by the populace, attributed to the removal of fuel subsidies and the ongoing conflict in Ukraine, Governor Fintiri implored those entrusted with palliative distribution to act with equity.
He committed to keep implementing relief measures until the momentary difficulties are overcome.
Reflecting on the experience, he avowed,
“One of the lessons that the hardship has taught us is that we must increasingly take agriculture seriously. This would enhance food security, improve family income, strengthen our economy and take our state resilient.”
Highlighting the transformative strides of the ADAS Programme, the Secretary to the State Government, Hon. Barr. Awwal D. Tukur revealed that in 2021, the total revenue from produce sales tax and livestock trade fees in the State amounted to N47.6 million.
This figure surged dramatically, with the ADAS Programme recording a cumulative collection of N355.4 million between September and December 2022. The momentum carried through to this year, with an impressive N663.3 million collected by August 2023. Consequently, the total Agribusiness collections for the period between September 2022 and August 2023 exceeded a staggering N1 billion (N1.018,653,632).
The ADAS Program’s Principal Consultant, Dr Aminu Buhari, emphasized the importance of the private sector-driven initiative that will work with the government to develop and maintain institutional and market reforms, design and manage enablers that will draw a sizable amount of investment, and have a positive impact on the state’s economy through the creation of an agribusiness guarantee scheme.
Among the program’s triumphs, Dr. Buhari celebrated a financial restructuring that saw the liquidation of costly short-term commercial loans, previously employed for infrastructural projects, in favour of more economical long-term financing sourced from the capital market.
Additionally, the state secured an Investment Grade from the Capital Market, refurbished 12 markets across senatorial zones, and propelled the total IGR from N6.2 billion in 2018 to N13.2 billion in 2022. Notably, over 2,000 direct and indirect jobs were generated.
The purpose of the Credit Guarantee Scheme is to offer the producers, aggregators, and processors the liquidity and support they need to expand their production capabilities and expertise in order to better connect with the market.
The cardinal objectives encompass expanding access to loans for beneficiaries seeking to acquire farm produce in the State without collateral. By offering guarantees to participating financial institutions, the state can lower the credit risk associated with lending to the agribusiness sector. This will encourage lower interest rates on loans by encouraging flexible collateral requirements by participating financial institutions. It will also broaden and deepen the offtake of the target value chains, which will increase state revenue.
Malam Dauda Mohammed, Secretary of Grain Markets in Adamawa State, conveyed the collective gratitude of intending beneficiaries, commending Governor Fintiri for ushering in the credit guarantee scheme. He claimed that the introduction of the ADAS Program had increased market growth and given enterprises access to funding for business expansion.
He gave the marketers his word that they would pay their earnings quickly after they had realized the advantages of the arrangement.v
The handing of Credit Guarantee Scheme letters to state marketers was the event’s high point.
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