At the inception of present era of Nigeria’s democratic experience in May 1999, there was an urgent need for the country’s revenue to be diversified through an agro-industrial revolution. But 10 years on, the six per cent growth rate recorded remains insignificant. In 2001, the federal government under the administration of former President Olusegun Obasanjo, announced major increase in import duties on some categories of products. The tariff on rice was raised from 50 per cent to 85 per cent during the year, and that of soya bean from 30 per cent to 60 per cent. Similarly, the tariff on palm oil and its fractions, whether refined or not was increased to 60 per cent from 35 per cent.

Other agricultural products under the same tariff regime included palm kernel and fractions. Moreover, tariff on animal or vegetable fats and oils and their vegetable thereof, rose to 60 per cent from 20 per cent. Bulk importation of vegetable oil was banned, while all imports were to be branded in cans. In 2003, the federal government raised the tariff on rice which stood at 100 per cent in 2002 to 150 per cent. In addition, a ban was imposed on the importation of cassava products and export of maize under the food security strategy of the government during the year, with the promise of vigorous enforcement. The major goal of this policy was the stimulation of local production; and to discourage imports.  

Recently, the Central Bank of Nigeria, CBN, finalised agreement with the United Bank for Africa, UBA, and First Bank of Nigeria, FBN, to administer the N200 billion commercial agriculture credit scheme. The objective of the scheme is to speed the development

of the agricultural sector through financing of commercial cultivation of rice, cassava, cotton, oil palm, wheat, rubber, sugarcane, fruits and vegetables, livestock, fishery as well as processing, storage and marketing of target commodities.  With nine per cent lending rate, interested farmers are expected to have integrated large-scale commercial farm/agro enterprises with asset base of not less than N350 million, with the potential of growing the asset to N500 million, in three years and the non-integrated enterprises with asset base of not less than N200 million. State governments and the Federal Capital Territory are to get 20 per cent of the loan through specialised agencies.

Aside from the government’s scheme, UBA announced its intention to give out the sum of N50 billion as loans to various categories of farmers in support of agriculture.  According to Phillips Oduoza, the bank's deputy managing director, the bank’s scheme entails making the facility available at single digit, with effective interest rate of eight per cent. The scheme, he added, will be available to all cadres of farmers, from small farmers to those engaged in mechanised farming. 

According to Oduoza, the initial capital was not the maximum the bank would offer in support of the agricultural sector. “The N50 billion capital from UBA is like experimentation. Once it works, we will put in more”, he assured.  Oduoza was emphatic that agriculture is just one particular segment of what the bank had in mind. "There are some others such as value chains on provision of opportunity, to get produce sold to expected buyers”, he said, adding tha

that the agricultural products to be produced under the scheme are going to be seasonal. 

FBN also has different schemes designed to enhance agricultural business in the country. Some of the schemes include Guaranteed Fund Credit, GFC, Multi-Channels Agricultural Finance Scheme, Industrial End-Users Out-grower Scheme, Co-operative/Linkage Banking Scheme, First Bank Agricultural Credit to Schools, FACTS, Agricultural Produce Finance and Term Loans and Overdrafts.