AfDB and partners agree to fast-track implementation of Special Agro Industrial Processing Zones program

The agreement emerged from a two-day meeting in Abuja, on 7 – 8 October, attended by senior government and bank officials and representatives of financing partners and the private sector

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Nigerian ministers gathered in Abuja with state representatives and other stakeholders to push for accelerated delivery of the SAPZ program in Nigeria. October 2024

The African Development Bank Group ,has reached an agreement with participating Nigerian state governments to speed up implementation of a program designed to develop eight new agro-industrial zones in the country. The agreement emerged from a two-day meeting in Abuja, on 7 – 8 October, attended by senior government and bank officials and representatives of financing partners and the private sector.

The Nigeria Special Agro Industrial Processing Zones (SAPZ) program, launched in 2022, aims to create new hubs that integrate the production, processing and distribution of targeted crops and livestock to achieve food security, increase incomes, improve livelihoods, and support economic diversification. By significantly reducing dependence on food imports and boosting exports, SAPZs are expected to boost the country’s foreign exchange reserves.

To implement the first phase of the SAPZ project in seven states and the Federal Capital Territory, the program has mobilized $538m in co-financing from the African Development Bank Group, the International Fund for Agricultural Development (IFAD), the Islamic Development Bank (IsDB) and the Federal Government of Nigeria.

Nigeria’s Minister of Finance and the Coordinating Minister of the Economy, Wale Edun who attended the meetings, said, “With inflation coming down, the reserves growing and the exchange rate stabilizing, success is being seen under the macroeconomic stabilization efforts of President Bola Tinubu. That is why the SAPZ program cannot and must not disappoint.”

Minister of Agriculture and Food Security, Abubakar Kyari, said, “The need to align all our efforts at the federal and state levels as well as with our development partners is germane, so that the momentum we gain here translates into tangible outcomes for the target beneficiaries, particularly those in rural areas where the SAPZs will have their greatest impact.”

According to the Director General of the African Development Bank’s Nigeria Country Department, Dr. Abdul Kamara, the meetings were aimed at strengthening collaboration among key stakeholders, including the private sector. Participants shared ideas and lessons learned, goals, and agreed on practical next steps to accelerate the implementation of Phase 1 of the program. The next phase of the programme will expand to include other state governments.

Emphasising the urgency of overcoming delays that have dogged program implementation, the Senior Special Adviser to the Bank President on Industrialisation, Prof. Banji Oyelaran-Oyeyinka, said the rapid implementation and take-off of SAPZs provides a solution to the declining contribution of manufacturing and manufacturing exports to Nigeria’s GDP.

The second day of the meeting featured a workshop that brought together officials from the federal and state governments, representatives of partner institutions, and private sector investors to discuss the program’s financial, procurement and operational processes, as well as an accelerated implementation plan. The federal and state governments committed to implementing transparent and competitively driven procurement processes, including the independent selection of vendors.

The sessions, moderated by Dr. Victor Oladokun, Senior Advisor on Communications and Stakeholder Engagement to the president of the African Development Bank, also provided a platform to highlight the complementary roles of stakeholders. While governments and financing institutions are expected to play a catalytic role, the private sector will focus on investing in the construction and operation of the key components of the zones: Agro Industrial Processing Hubs (AIHs) and Agricultural Transformation Centres (ATCs).

The first phase of the Nigeria SAPZ program is expected to unlock about $1 billion in private sector investments, benefiting an estimated 1.5 million households, including private agribusinesses, agro-processors, smallholder farmers, agripreneurs, and agrodealers, and creating a minimum of 400,000 direct jobs and 1.6 million indirect jobs, especially for women and youth.