Nigeria First (Abuja)

Nigeria: Cellphones for Nigerian Farmers By Dr. Akinwumi Adesina, Minister of Agriculture

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Photo: Vanguard
Cellphones for farmers

Following is the prepared text of a speech by Dr. Akinwumi Adesina, Minister of Agriculture, during a press conference at State House, the office and residence of the president of Nigeria.

When the story of 10 million phones costing 60 billion naira for Nigerian farmers first made the headlines, I immediately put out a press release denying that the Ministry of Agriculture was planning to spend such a huge amount of money on cell phones.

Since then, I have read several comments on the Internet and in the newspapers and I find that it is necessary for me to enlighten the public about what the ministry of agriculture has been doing to help our farmers. It is also important to explain why it is necessary for farmers to own cell phones and how we intend to finance our plan to distribute cell phones to them.

When I came on board as minister of agriculture in July of 2011, I found a corrupt and totally inefficient fertilizer sector. The government was spending huge amounts of money on direct procurement and distribution of subsidized fertilizer, but less than 11% of farmers got the fertilizers. Some of the fertilizers paid for by government were never delivered to the warehouses. Some of the fertilizer delivered contained more sand than fertilizer while a large portion of the fertilizer subsidized by government found its way across our borders to neighboring countries where it was sold at prevailing market prices.

Middle men and rent seekers were the ones benefiting from the billions of naira spent every year on fertilizer subsidies.  The same applied to the seed sector. Middle men and briefcase contractors masquerading as seed companies were doing brisk business supplying seed to government. The problem was a large portion of the seeds being sold to government was grain bought on the open market corruptly sold as certified seed.

It was clear to me that we needed to end this corrupt system if we are to have any hope at all of freeing Nigerian farmers from the shackles of rent seekers and opportunists who have for decades disempowered the farmers and hampered the growth of the sector.

The more government was spending on fertilizer subsidies, the more rural poverty increased and the more agricultural productivity declined.

The system of direct government procurement and distribution of fertilizer led to massive leakages and in short, government was simply subsidizing corruption not farmers. A new system had to be found that would end this corruption by reaching legitimate farmers directly. The system needed to be one that would foster transparency and accountability.

I am happy to say that we indeed developed such a system. With clear directive, support and determination from President Goodluck Jonathan, we ended four decades of corruption in the fertilizer sector within 90 days of my assumption of office as minister.

How did we do this? We were able get subsidized high quality fertilizer and seeds to our rural farmers by introducing the GES (Growth Enhancement Support) scheme in April of 2012. The GES scheme delivers inputs (fertilizers and seeds) to farmers directly by using farmers' cell phones. We created an electronic platform (e-wallet) on which we registered farmers and agro dealers who own shops that sell farm inputs all over the country. To date we have registered 4.2 million farmers and about 900 agro dealers. We developed the first ever registered data base of farmers in Nigeria, which we will upgrade every year. For the first time ever, we can now base policy decisions on data, not guess work. We now know and can identify our customers, the farmers.

Registered farmers are sent electronic vouchers directly from the federal government to their cell phones. This voucher or e-wallet informs the farmer that he or she is entitled to buy two 50kg bags of fertilizer at 50% of the purchase price. The voucher essentially serves as cash on their phones and this cash covers 50% of the market price of the fertilizer.

The farmer therefore pays only 50% of the cost of the fertilizer to the fertilizer retailer.  Fertilizer and seed retailers no longer supply seeds and fertilizers directly to government. They now sell directly to farmers. Government helps the farmer to buy inputs by providing direct support through their cellphones (e-wallet).

In the first year of the GES scheme, 1.2 million farmers received their subsidized fertilizers and seeds via their cell phones. We expect to have reached 1.5 million farmers by the end of the dry season. Let me say, that this singular effort to get inputs to farmers directly resulted in the addition of an estimated 8.1 million metric tons of food to the domestic food supply. This addition helped to mitigate the effect of the flood on the nation's food supply and we were able to avoid a food crisis.

For the first time in Nigeria we can tell you the names, addresses and phone numbers of each farmer who received subsidized inputs from the government. The GES scheme provides us with a fair, equitable, accountable and transparent means of distributing farm inputs to our rural farmers.

Similarly, for many years government was also directly procuring tractors for farmers. But just as it was with fertilizers, contractors bought old refurbished tractors instead of new tractors.

These old tractors would work for a few months and thereafter would stop working and then be abandoned in all sorts of places because there were no spare parts to repair them with.  We also ended the corruption associated with tractors. The federal government no longer buys nor distributes tractors.

Plans are underway to use the GES scheme to help farmers access tractor hiring services. Instead of the government procuring tractors for farmers, the government is encouraging the private sector to establish tractor hiring centers. Farmers can hire tractors from these centers and the cost of hiring tractors will be subsidized by the government through the e-wallet using farmers' cellphones.

Some people are asking questions like, "Why cellphones for farmers?" "Will the fertilizers and seeds be attached to the cellphones?" "Will tractors be attached to the cellphones"? As you can see from the above explanation the answer is "Yes!" It is actually the cell phone that has provided us with the tool to directly access each farmer thereby saving them from corrupt middlemen who make their fortune from exploiting the poor.

Some people think that our farmers are uneducated and cannot use cell phones. The evidence does not support that. Under the GES scheme, we made it possible for farmers to transact business in their own local languages using their cellphones. From data we collected based on farmers' use of cellphones to access fertilizers and seeds last year, we found that the total number of transactions done by phone with respect to the GES scheme was 4.9 million. Of these, 1.2 million were in English, 620,000 were in Pidgin, 2.2 million were in Hausa, and 854,000 were in Yoruba and 344 were in Igbo. From this data, we have no doubt that our farmers are well able to use cellphones.

Nigeria is the first country in Africa to launch a GES scheme that delivers farm inputs to farmers using cellphones. We are very proud of this achievement. Several other African countries now want to adopt the same system.

As I said earlier, last year we reached 1.2 million farmers with subsidized inputs via their cellphones. This year we have plans to scale up to reach 5 million farmers. These plans cannot be based on guesstimates or wishful thinking or noise. It must be based on evidence from data. In other words government policy must always be based on evidence and well analyzed data.

We carried out an analysis of our GES work based on a large sample of 426,000 farmers from various local government areas in 13 states. We found that 71% of farmers sampled did not have cell phones. This shows that many of our farmers in rural areas are quite poor and are excluded from the benefits of the mobile phone revolution going on in Nigeria.

These farmers cannot access the GES scheme without cellphones and we must find a way to include them. They must not be left behind.

Some are asking how we arrived at the figure of 10 million farmers. Some are even saying we do not have up to 5 million farmers in the nation. The national bureau of statistics has estimated the number of farmers in Nigeria as 14 million. The FAO also has reported a similar number. From the result of our sampling which showed that 71% of farmers do not have any phones, we can project to the larger population of 14 million and arrive at an estimate of 10 million farmers who probably do not have phones.

Of course we cannot get 10 million phones to all farmers who do not have phones this year. This is impractical to say the least. Our plan is a gradual scale up. We intend to get about 2 million phones to farmers who do not have phones this year.

How will these phones be paid for and how will they be distributed?

We ended four decades of corruption in the fertilizer and seed sector by ending direct procurement and distribution of these inputs by the government. We also ended the ineffective and corrupt direct procurement and distribution of tractors by government. It will therefore be inconsistent for government to now start direct procurement and distribution of phones.

Let me say this loud and clear: There will be no direct procurement of phones by the federal government. We are also not going to give anyone contracts to import phones from China or anywhere else. Let me also state loud and clear: there is no 60billion Naira anywhere to be used to buy cellphones.

The Ministry of Agriculture and Ministry of Communications Technology are partnering together to implement this policy.  We intend to use the GES scheme to distribute these phones. To be entitled to a phone, farmers must be registered on the e-wallet platform. Paper vouchers will be issued to farmers who do not have phones. The government will provide a subsidy to the farmer through the voucher to buy the phone. The farmer takes the voucher to the local mobile phone operator and pays the balance which is the difference between the value of the voucher and the cost of the phone.

Once a farmer buys a phone and a SIM card, his new phone number will be updated on the e-wallet database and he will be able to receive his e-wallet voucher which will entitle him to purchase fertilizer and seeds at subsidized rates.

Phones will be sold directly to farmers by local mobile phone service providers. The government simply subsidizes the cost of the phone directly to the farmer.

Government will work with interested mobile phone service companies to achieve its goal. We intend to start by first targeting farmers who live in areas where there is network coverage already but who do not have phones. We will then encourage phone companies to increase their coverage and as they do we will target farmers in those areas. By so doing phone companies will have the incentive to expand to rural areas because our program will assure them of customers in those new areas.

Cell phones in the hands of our farmers will do more than deliver government subsidized inputs.  It will provide them access to market price information. They will be able to bargain better and save themselves from the middlemen who currently exploit them by paying them very low prices for their produce.

Cellphones in the hands of our farmers will allow us to reach farmers with extension information such as what crops to plant, when to plant and other agronomic practices that will help them improve their productivity.

It will allow farmers to better deal with shocks such as drought and floods in real time. Simple alerts to farmers' phones can help them avoid catastrophes while saving lives.

Majority of our farmers are excluded from financial services. 78.8 % of Nigeria's rural population are unbanked according to the report by Enhancing Financial Innovation and Access, EFInA. The cost of reaching them in rural areas is high for financial institutions. No bank can afford to build branches in every little village. Cellphones provide financial institutions with a low cost and efficient way of providing financial services to our farmers.

The use of cellphones to provide financial services in rural areas is not new. It is already being used in several African countries. For example the M-Pesa mobile money system used in Kenya, moves millions of dollars between urban and rural areas every year.

Farmers can also participate in agricultural commodity exchange by using their cell phones. This will allow farmers to know if there are buyers interested in the crops they wish to sell, where these buyers are located and the quantity and quality the buyer is looking for. If the farmer can satisfy the requirements of the buyer a deal can be initiated and the buyer and seller can arrange to meet to complete the transaction.

Many African countries have successfully introduced the use of cell phones and ICT to enhance agricultural productivity and access to markets. Nigeria must position herself to do the same.

As Minister, I cannot use hype to guide policies. I must use evidence to guide policies. When the floods occurred, there was panic in the land. Some derided our efforts and said Nigeria would have famine; that there would be massive food shortage; and there would be food riots. Those who wanted to import food and get waivers from government sponsored such media hypes.

I was not moved. We used modern technology to guide our decision. Using remote sensing and satellite imagery, we mapped out the extent of the flood and determined that no more than 1.17% of our total cultivated area was affected by the floods. Our detractors wanted the world to believe the opposite, that food crisis was imminent. They were wrong. Today, five months after the floods, we do not have a food crisis.

The same way these detractors have misled the public about the relevance of cellphones in Nigerian agriculture - they do not know that we are already using cellphones to distribute fertilizer and seeds to even mitigate the impact of the flood. We are already using cellphones to reach 232,000 farmers for rice production in the dry season, each getting 3 bags, across 10 states of the north east, northwest and north central regions. To reach farmers affected by the flood, we are also using cellphones through the growth enhancement support. We are reaching 98,000 farmers affected by floods across the country with 2 bags of fertilizers per farmer, plus one bag of agrolyser micronutrient to replace some of the soil micronutrients that have been washed away by the flood. Such is the power of cellphones revolutionizing agriculture today in Nigeria.

Our future lies ahead of us. We will rapidly modernize the agricultural sector. The days are gone when town criers were used to transmit information in our rural areas.

This is a modern world.  Several African countries are accelerating the pace of use of cellphones in agriculture. Nigerian farmers will not be left behind.

I brought to this job many years of successful and impactful global leadership which have helped other countries implement innovations that improved their agricultural sector. In 2000, while at the Rockefeller Foundation, I helped Kenya to develop the Kenya Agriculture Commodity Exchange, which posts market information, including prices and bids and offers to buy produce.

These are easily accessed by farmers using their cellphones. In 2001-2002, I helped to do the same for Malawi, with the development of the Malawi Agricultural Commodity Exchange, which also uses cellphones to reach and empower their farmers. Why should my own country, Nigeria, be left behind? Agricultural Commodity Exchange is much needed in Nigeria. The basic foundation for an agricultural commodity exchange is access of farmers to market price information via cellphones.

I will not be distracted. We will rebuild the broken walls of Nigeria's agriculture and unlock wealth and opportunities for our farmers.  For those calling for my crucifixion, let me say that when Jesus was before Pilate, they had accused him falsely. Pilate, after listening to his case, found no cause for condemning him.

Nonetheless, should anyone still want me crucified, let me say this, along my faith: "I am crucified with Christ already. Nevertheless, I live and the life that I live, I live by the grace of the son of God, who died for me".

I have stolen no man's silver, nor demanded any man's gold, and will continue to drive bold innovations and reforms to fully modernize and transform the agricultural sector. That is my remit from the President and that is exactly what we will do, as I continue to serve my nation with the highest level of vision, passion, personal integrity and dedication.

God bless the farmers of Nigeria.

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