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Why CBN was weak in regulating exorbitant prices of local rice

Only recently, the Central Bank of Nigeria (CBN) released its third quarter report on the performance of the Commercial Agricultural Credit Scheme (CACS).

The report showed that “At end-September 2019, the total amount released since inception by the CBN under the Commercial Agriculture Credit Scheme to the participating banks for disbursement amounted to N610.4bn for 593 projects, while total amount repaid since inception stood at N368bn at end-June 2019, compared with N338.4bn.”

However, before the report, the apex bank had in September revealed that it had given out well over N146bn to rice farmers via its Anchor Borrowers Programme (ABP), but was silent on repayment and recovery from beneficiaries.

Late last month, there were reports that in view of recovering over N36bn loan given to rice farmers in one North East states (name with held), committees were set up in every local government for the purpose, thus raising a fundamental questions on the existence of ABP’s loan securitization plan to avoid cases of nonperforming loans (NPLs) in the sub-sector.

Otherwise, the observed silence of the apex bank in either announcing loan recoveries from rice farmers considering the geometrical rise in sales since the closure of border against rice smuggling is a source of worry.

Besides, there is a yet to be challenged speculation that why the price of local rice had remained at rooftop is to allow farmers make huge sales so as to recover CBN’s ABP loan for semaless repayment.

Analysts say aside allowing rice farmers the window to sale their products at any price of their choice, CBN or the Federal Government may not have the ground to pressure ABP beneficiaries to pay back on time after all.

Only recently and after Nigerians have complained bitterly on the prices of local rice that the CBN Governor, Godwin Emefiele made a weak call to rice farmers to reduce their prices.

On the other hand, many Nigerians are calling on the CBN to publish beneficiaries of ABP on rice and time for the repayment of their loans back to government coffers for record purposes.