The European Union Delegation to Nigeria and ECOWAS have launched the EU-Nigeria Agribusiness Platform, aimed at increasing private investments in the country’s agribusiness sector.
The initiative will contribute to the reduction of food insecurity and poverty as well as the attainment of sustainable economic development in Nigeria.
The EU-Nigeria Agribusiness Platform will contribute to boosting the exploration and exploitation of agribusiness opportunities between Nigeria and the EU through the establishment and maintenance of a network of active members of agribusinesses across Nigeria and the EU.
An agribusiness platform is a form of digital agricultural platform that provides digital marketing, trading, or investment space for commercial and/or transactional activities, interactions, communications, integrations, and cooperation in the agri-food system and agro-industry between Nigerian and European SMEs.
The EU-Nigeria Agribusiness Platform’s primary focus is to create linkages and interactions between Nigeria and EU agribusiness stakeholders, especially amongst SMEs, and promote trade and investment between both sides.
As recalled by the Deputy Director General, Directorate of International Partnerships (INTPA), European Commission, Myriam Ferran, the idea for an agribusiness platform stems from the commitments of the November 2020 EU-Nigeria Ministerial Dialogue.
In consultation with the government of Nigeria, it was decided to launch an EU-Nigeria Agri-Business Platform as a structured dialogue between Nigerian and EU farming and agri-food communities and agricultural and agro-industrial sectors to promote trade, attract responsible investment, and foster business linkages, particularly for SMEs.
Sustainable agriculture is a cornerstone for economic development and sustainable growth in Nigeria. The agricultural sector contributes around a quarter of the gross domestic product (GDP).
Considering its importance, successive Nigerian governments have been striving to diversify the economy from its crude oil dependence by rejuvenating the agricultural sector through different agricultural policies and programmes in order to promote and propel the agricultural sector for enhanced productivity and an increased agri-food commodity base.
The volume of EU-Nigeria trade stood at €24.6bn in 2023, 18.7% lower than in 2022. The EU remains Nigeria’s biggest trading partner, first investor, top donor of humanitarian and development aid, and the biggest diplomatic network. EU-Nigeria trade relations favour Nigeria, with crude oil contributing the most to the imports from Nigeria.
There is a need to improve non-oil trade between Nigeria and the European Union.
Agribusiness Register Limited, a private sector entity conversant with the agribusiness ecosystem, will manage the EU-Nigeria Agribusiness Platform.
The idea of handing over the platform to a private sector-led entity working in partnership with public and private sector stakeholders came out during a stakeholders’ consultative meeting in April 2023.
The Agribusiness Register Limited, owners and managers of the Nigeria Agribusiness Register, will work with and engage with selected agribusinesses, farmer groups, aggregators, and other critical stakeholders.
It will also nurture partnership and collaboration with EU implementing partners in the relevant space of agriculture, digital, and entrepreneurship, on the one hand, with the relevant agencies of the government of Nigeria.
In particular, it will work with the Federal Ministry of Agriculture, the Federal Ministry of Industry, Trade, and Investment, the Nigeria Export Promotion Council (NEPC), the Standards Organisation of Nigeria, and the Ministry of Communication and Digital Economy.
Also, the European Union and Eurocham Nigeria (the European Business Chamber) signed today a €300,000 grant agreement to support the further development of the Chamber. This significant financial contribution underscores the EU’s commitment to fostering strong economic and commercial ties with Nigeria.
The Deputy Director General, Directorate of International Partnerships (INTPA), European Commission, Ms. Myriam Ferran, and Eurocham’s Vice President, Mr Frederik Klinke, signed the grant agreement on behalf of the two parties during the 9th EU-Nigeria Business Forum, held in Abuja on July 2, 2024.
The grant aims to enhance Eurocham’s capacity to serve its members better, promote European business interests in Nigeria, and contribute to overall mutual economic growth and development.
Ms Myriam Ferran underlined the importance of the partnership, emphasising the EU’s commitment to supporting initiatives that drive economic growth and strengthen the ties between the EU and Nigeria in line with the Global Gateway Strategy.
“This grant to Eurocham Nigeria is a testimony to the EU’s dedication to fostering a vibrant business environment and facilitating meaningful economic exchanges in Nigeria,” she said.
Meanwhile, the Dutch entrepreneurial development bank FMO and Nigeria’s First City Monument Bank (FCMB) signed a $25 million NASIRA guarantee agreement.
The guarantee will enable FCMB to expand its funding to agricultural, youth, and women-owned SMEs without requiring collateral, targeting a client group typically deemed too risky by banks.
Funded by the European Commission, NASIRA is one of FMO’s most innovative programmes, encouraging local banks to extend their funding to small entrepreneurs without collateral. Often, the FMO guarantee, which effectively replaces the collateral, is not fully utilised, demonstrating that these entrepreneurs, primarily women and young people, are not riskier than others.
Job creation in Nigeria, home to 220 million people and the largest population in Africa, is critical. The country faces severe economic challenges, including high unemployment and a significant 70% depreciation of its currency over the past year. Providing small loans to typically high-risk groups will enable them to start and expand their businesses, offering a means of income for themselves and their families.
In addition to the USD 25 million NASIRA guarantee, FMO will support FCMB with a syndicated loan of USD 60 million: USD 20 million through FMO, USD 30 million through the European Financing Platform on behalf of BIO, DEG, EIB, FINNFUND, Proparco, and SWEDFUND, and USD 10 million through FMO Investment Management. The loan is dedicated to growing the existing FCMB loan portfolio of small and medium-sized entrepreneurs (SMEs).
Speaking during the signing ceremony at the sidelines of the 9th Nigeria EU Business Forum, the Deputy Director General, Directorate of International Partnerships (INTPA), European Commission, Ms. Myriam Ferran, said: “We are very happy to see that the EU investment instruments, such as the European Fund for Sustainable Development (EFSD+) guarantees, have come to Nigeria to play a catalytic role in leveraging private sector investments for the benefit of the real sector, economic diversification, and employment creation, especially for youth and women.”
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