During the Africa Reinsurance Corporation Agriculture Workshop in Lagos, the Deputy Managing Director of the African Reinsurance Corporation, Ken Aghoghovbia, highlighted the concerning fact that Nigeria relies on approximately $10 billion worth of agricultural imports to bridge the gap in food and agricultural production.
The two-day event, held as part of the International Finance Corporation’s Technical Assistance Provider mandate for the Nigeria Climate Insurance project, brought together key stakeholders from the Nigerian agriculture insurance industry.
The workshop aimed to create a collaborative platform for various industry players, including insurers, government agencies, farmers’ representatives, the insurance regulator, financial institutions, input dealers, and commercial farms.
In his opening remarks, Aghoghovbia emphasized the challenges facing the agricultural sector in Nigeria.
He pointed out that despite its significant contribution to the GDP, the sector has been adversely affected by various shocks, including flooding, desertification of crop and grazing lands, conflicts between herdsmen and local farmers, inadequate access to financing, and limited adoption of modern technology.
These issues have hampered productivity, resulting in a considerable gap between local food supply and demand, forcing Nigeria to heavily depend on food imports.
Aghoghovbia stated, “The International Trade Administration estimates that Nigeria relies on about $10 billion of imports to meet its food and agricultural production shortfalls.
Agriculture insurance holds great promise in turning around the fortunes of Nigeria’s agriculture sector.”
Over the last five years, agriculture insurance has garnered increased attention from the Nigerian insurance market, driven by opportunities arising from the need to modernize and commercialize agricultural production and the government’s commitment to diversify the economy.
With vast agricultural land spanning approximately 70 million hectares and a diverse range of agricultural enterprises, Nigeria’s agriculture insurance market has the potential to generate premiums exceeding $600 million.
This revelation underscores the critical need for enhancing food security and agricultural self-sufficiency in Nigeria, making it imperative to address the challenges that have hindered the sector’s growth.
The workshop’s collaborative approach could play a pivotal role in reshaping the landscape of Nigeria’s agricultural industry and reducing its reliance on costly imports.
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