COP31: Nigerian Bank of Agriculture Seeks Climate Funding to Support Agricultural Adaptation Projects
Chiemelie Eze in Antalya, Türkiye
The Bank of Agriculture (BOA) has called for increased climate financing from developed countries to support agricultural adaptation projects in Nigeria and across Africa, while unveiling plans to deploy electric cargo tricycles and solar-powered irrigation systems to improve farmers’ productivity.
The BOA Managing Director and Chief Executive Officer, Ayo Sotinrin, made the call yesterday at the ongoing COP31 climate conference in Antalya, Türkiye, where he said Nigeria and other African countries needed more financial support to address the effects of climate change on agriculture.
Sotinrin said the bank was exploring partnerships and financing arrangements to introduce practical climate adaptation solutions, particularly in agricultural transportation and irrigation.
He disclosed that the bank was exploring the introduction of electric cargo tricycles capable of transporting 2,000kg of agricultural produce from farms to farm gates in one trip, compared with fossil-fuel-powered two-wheelers that carry about 50kg.
He said, “We are introducing electric cargo tricycles that can actually move 2,000kg from farms to the farm gate at once, rather than the fossil-fuel-powered two-wheelers that move only 50kg.”
He also said the bank was looking to expand solar-powered irrigation through one-to-five-horsepower pumps and subsurface pumps to enable farmers cultivate their land at least three times annually.
“We’ve also looked at how we increase the adoption of solar irrigation across board, using one-to-five-horsepower pumps or subsurface pumps to ensure that farmers can actually farm three times a year at the minimum.
“This would further increase our productivity by at least 300 per cent,” he said.
According to him, the initiatives would help transform agricultural production and mitigate some of the challenges posed by climate change.
On the outcomes expected from COP31, he called for renewed commitments by world leaders, expressing concern that previous climate financing promises had not been fulfilled.
He said existing commitments were insufficient to keep global warming below 2.5 degrees Celsius, let alone achieve the 2-degree and 1.5-degree targets.
“My takeaway from COP is refreshed commitments from world leaders. Also, the fact that we are all coming to a realisation that all the promises that were made were not kept.
“We are talking about those commitments that were made; they will not even get us below 2.5 degrees, let alone getting to 2 degrees or below 2 degrees, which is 1.5 degrees, where we want to be,” he said.
He called for increased funding from the Global North to Africa through blended financing instruments, including grants, commercial capital and development finance, to support climate adaptation projects.
“We need more capital. The capital stack needs to be explored, especially from the Global North to Africa, where we have different types of blended instruments, including grants, commercial and developmental capital going into adaptation solutions in Nigeria and Africa at large.
“So those are the sorts of things that we are happy have been discussed at COP31 today,” he said.
On access to agricultural financing, Sotinrin said the bank had digitised many of its processes and systems to make funding more accessible to farmers.
He, however, explained that the bank had moved away from providing microcredit directly to individual farmers, preferring to channel loans through cooperatives, farmer aggregation companies, microfinance banks and commercial banks.
He said, “We’ve stopped giving microcredits to individual farmers unless they come under an umbrella of a medium cooperative or a smaller cooperative, or a farmer aggregation company, or even through asset-based financial institutions such as microfinance banks and commercial banks that we blend capital with.”
He explained that the approach was necessary to ensure effective loan recovery, noting that the bank’s 110 branches could not independently manage lending to two million individual farmers.
“If you tell me to finance individual farmers, it’s very difficult because one of the things that scale, and there’s no way the Bank of Agriculture, with 110 branches, can actually finance two million farmers individually and be able to recover those monies.
“And if we don’t recover those monies, we erode our shareholder capital and we’re back to square one,” he said.