by Winifred Egbeama.

Policy & Governance Area: Economic Growth and Human Development 

Recently, the Governor of the Central Bank of Nigeria (CBN), Mr. Godwin Emefiele disclosed the banks’ initiative to kick-start a university-based Poultry Revival Programme to boost poultry production in the country. During a meeting with Vice Chancellors, the CBN boss represented by CBN Deputy Governor, Economic Policy, Dr Okwu Nnanna stated that the aim of the apex bank is to ensure that poultry production is increased and to bring an end to the smuggling of poultry products into Nigeria. In order to ensure the attainment of these goals, it was revealed that the bank would provide necessary funds and considerable human, material, and financial resources to monitor both the disbursement and utilization of the funds in a robust and verifiable manner.

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Poultry are raised for their meat and eggs, and are an important source of edible animal protein[ii]. They are also a source of income and revenue generation as commercializing them yields profits. The poultry sub-division of the agricultural sector appears to be one that has not been given as much attention as it deserves. It is the most commercialized of Nigeria’s agrarian sub-sectors[iii] which accounts for 25% of the GDP derived from agriculture and has also employed 14 million persons in the country[iv]. In Nigeria,165 million birds, 650,000 metric tonnes of eggs and 290,000 metric tonnes of meat are demanded annually but unfortunately only 30% is being met by indigenous farmers and the remaining 70% are foreign sourced (most of which are smuggled in)[v].

It is in line with the above that the Central Bank of Nigeria (CBN) has launched a programme – the university-based Poultry Revival Programme. The apex bank revealed its intentions to partner with universities to breach the gap in the demand and supply of chicken products and to also bring an end to smuggling of same into the country[vi]. To that effect, it made a commitment to provide human, material, and financial resources to monitor both the disbursement and utilization of the funds in a vigorous and confirmable manner[vii]. Although the decision of the CBN to pioneer the project can be said to be timely, seeing that it is one of the Federal Government’s plan to diversify the economy, however, certain questions come to mind at this point. Why did the CBN choose to partner with Universities and not other institutions or private business owners? What are the criteria for selecting the universities to partner with? What is the duration of the project? How is the profit derived from the project supposed to be disbursed? Will the proceeds solely be for the universities?

The CBN governor via his representative stated that it chose to rely on the university-based poultry production model because universities already have the existing infrastructure, experience and human assets to produce at reduced costs and in a competitive manner[viii]. This means that it is perhaps more economical for the apex bank to partner with universities than private business owners, seeing that universities already have the structured production system. It is important to note that one of the challenges private poultry farmers are being faced with is the cost of production, hence it may not be surprising that smuggled chicken products are more affordable than locally produced products[ix]. The smuggled chicken costs about ₦500- ₦700 ($2.50-$3.50) per kg while locally produced frozen chicken costs between ₦1,000- ₦1,300 ($5 – $6.50) at retail locations, and approximately ₦650 ($3.25)[x]. Hence, it probably makes more economic sense for the CBN to partner or invest in the universities, seeing that they already have a production system that appears to be more efficient. Also, another factor the bank may have considered is the large expanse of land that the universities already possess.

As regards the criteria in selecting the universities to partner with, the bank boss stated that the programme can be accessed by the universities who need them the most and are ready to operate their facilities in a commercially viable manner[xi]. The question that comes to mind is how to determine which university needs the project the most? What is the yardstick to measure which university really needs it? Perhaps a record of Internally Generated Revenue (IGR) might help, but it may not be the best measure because a university who has a higher IGR than another could have a more efficient production system than one who has a low IGR. The duration of the project was not stated, but it appears to be one that is long term. Also, with regards to profit sharing of the proceeds, the bank did not state expressly the modality, even though it seems like the profit might be for the institution, considering the fact that the apex bank stated that it would monitor how the funds and proceeds are being spent[xii].

Generally, the step of the CBN to kick- start the programme can be said to be one taken in the right direction. This is because, if the project is successful, Nigeria might be able to surpass the local demand for poultry products and perhaps even supply other countries in Africa. Thankfully, Nigeria has signed the African Free Trade Continental Agreement, so it will be easier to have access to their markets even though it may seem aspirational. Also, the project would create more job opportunities as the universities would need to employ more people or perhaps pay more students to work in their poultry.

Conclusively, there is need for CBN to make certain terms of the programme clearer as the execution and success of the project depends on the clarity and practicability of the terms.

 

[i] This article was taken from The Punch Newspaper (online). Available at: https://punchng.com/cbn-unveils-strategies-to-revive-poultry-sector/ . Date accessed: 09/07/19.

[ii]Poultry Production. Agricultural Nigeria (online). AvaiIlable at: https://agriculturenigeria.com/farming-production/livestock/poultry . Date accessed: 09/07/19S

[iii] CBN to Partner with Varsities to Boost Poultry Production, James Emejo, 09/07/19. Thisday Newspaper (online). Available at: https://www.thisdaylive.com/index.php/2019/07/08/cbn-to-partner-with-varsities-to-boost-poultry-production/ . Date accessed: 09/07/19.

[iv] Interesting Facts About the Nigerian Poultry Industry, 04/06/19. Lagos State Employment Trust Fund (online). Available at: https://lsetf.ng/content/interesting-facts-about-nigerian-poultry-industry . Date accessed: 09/07/19.

[v] ‘Local farmers produce 30% of Nigeria’s poultry demand’, Success Nwogu, 01/09/19. The Punch Newspaper (online). Available at: https://punchng.com/local-farmers-produce-30-of-nigerias-poultry-demand/ . Date accessed: 09/07/19.

[vi] CBN unveils strategies to revive poultry sector, Ifeanyi Onuba, 09/07/19. The Punch Newspaper (online). Available at: https://punchng.com/cbn-unveils-strategies-to-revive-poultry-sector/ . Date accessed: 09/07/19.

[vii] Ibid.

[viii] Ibid.

[ix] Creating Value, Building Businesses, Transforming Communities, Sahel Report (online) Volume 11, June 2015. Available at: http://sahelcp.com/wp-content/uploads/2016/12/Sahel-Newsletter-Volume-11.pdf . Date accessed: 09/07/19.

[x] Ibid.

[xi] CBN to Partner with Varsities to Boost Poultry Production, James Emejo, 09/07/19. Thisday Newspaper (online). Available at: https://www.thisdaylive.com/index.php/2019/07/08/cbn-to-partner-with-varsities-to-boost-poultry-production/ . Date accessed: 09/07/19.

[xii] Ibid.