Economist urges increased global awareness for Nigeria’s agricultural commodities


By Lydia Ngwakwe
Lagos, April 29, 2021 An Economist, Prof. Doyin Salami urges stakeholders in the Agricultural sector to increase efforts to build global awareness and recognition for Nigeria’s agricultural commodities.
Salami, Member, Nigeria Economic Group, made the call at a Webinar organised by SABEX in collaboration with the Sterling Bank Plc, on Thursday in Lagos with theme as “Agro-Commodities As A Viable Asset Class”.
Naija247news reports that SABEX is the world’s first end-to-end blockchain commodities trading and financing platform, powered by Sterling Bank.
According to the economist, agriculture is one quarter of Nigeria’s economy and it has been denied access to capital and to the extent that opportunities in the sector have remained unharnessed.
Salami identified opaqueness and lack of structure as some of the major factors that impeded participation of investors and increased growth in the sector.
“The opaqueness of information means that the opportunities that we can see, not just distinctive, have not really been taken advantage of.
“So, for some of us, the key challenge now is how to ensure making the nation’s agricultural commodities to be seen worldwide as commodity class and asset class,” he said.
According to Salami, the opportunities globally and in Nigeria are large, but nobody can really say the amount of trade that is going on in agricultural commodities.
He said: “We have a clarity about GDP Data, however, GDP data measures value addition and so, that is not to speak about trading that goes on.
“In Nigeria, the ecosystem is crystallising around commodity exchanges; there are three of them currently – the EFEX, Lagos Commodity Exchange and the Nigerian Commodity Exchange .
“So you are already beginning to see trading platforms that can help pull resources in formalised agriculture, and enable a meeting between the fiscal and financial markets space.
“We need to synthesise that bridge because that is really the big gap that needs to be closed if agricultural commodities are going to be assets,” Salami said.
Earlier, Mr Abubakar Suleiman, Chief Executive Officer of Sterling Bank Plc, said the bank was ready to create a level of trust among different players in the commodities market as lack of trust was a major problem in the space.
`We want to get to a point where commodities have the features of financial instruments as a first leg toward digitising commodities.
“In order words, the point where commodities are very similar and behave similar to digital assets, like we have seen in other ecosystem,” he said.
Suleiman said that the outcomes the bank was betting on were to create productivity, saying that everything that would be done must lead to productivity per hectare and per capital.
He said: “Until we achieve that, where the original producer can actually get more for what they do today, we don’t have the chance to actually scale and create the ecosystem that we want.
“And the way we try to create that productivity is by scaling,” he added.