AfDB to Invest $1bn in Expanding Special Agro-Industrial Processing Zones Across Nigeria

The African Development Bank (AfDB) has unveiled an ambitious $1 billion financing plan for the second phase of its Special Agro-Industrial Processing Zones (SAPZ) program, designed to revitalize agriculture across Nigeria.

Dr. Akinwumi Adesina, President of the AfDB, announced this development during the inauguration of a soybean plant and refinery by Called Servant to Service (CSS) Global Integrated Farms in Gora, Karu Local Government Area of Nasarawa State. The refinery, with a capacity to produce 10,000 liters of soybean oil per day, is expected to significantly reduce Nigeria’s dependency on crude soybean oil imports, valued at $62.2 million in 2023.

Dr. Adesina praised the refinery as a milestone achievement in Nigeria’s agricultural sector and emphasized its role in boosting domestic production. He pointed out that the farm’s operations could be further enhanced within the framework of the SAPZ initiative. This initiative, backed by $538 million in funding for its first phase, is already operational in seven states, including Cross River, Imo, Oyo, Ogun, Kaduna, Kano, and Kwara, as well as the Federal Capital Territory (FCT). The second phase aims to cover the remaining 28 states, supported by AfDB, the Arab Bank for African Economic Development, and private sector partners.

At the Africa Investment Forum held in Rabat, Morocco, in December 2024, the AfDB and its partners successfully mobilized $2.2 billion in investment interest for the SAPZ program. Nasarawa State is expected to feature prominently in the second phase, with CSS Farms serving as a key anchor investor in the proposed agro-industrial processing zone.

“The second phase of the programme would cover remaining 28 states, with a financing target of one billion dollars from AfDB, the Arab Bank for African Economic Development, and the private sector,” Adesina stated.

Dr. Adesina commended CSS Farms for its efforts in improving food production, promoting agribusiness among Nigerian youths, and obtaining the prestigious International Organization for Standardization (ISO) 9001 certification.

While these developments highlight the potential for a transformative impact on Nigeria’s agricultural sector, insecurity remains a critical challenge. Across the country, particularly in the northern regions, farmers face significant threats from banditry, terrorism, and communal clashes. The dangers have rendered vast farmlands inaccessible, undermining food production and creating a ripple effect of economic hardship.

This week, Boko Haram insurgents killed at least 40 farmers and fishermen at Dumba community farms near Baga in Borno State, northeast Nigeria. Such incidents are not isolated; they underscore the persistent insecurity that continues to threaten rural livelihoods and agricultural productivity.

Experts have warned that without addressing insecurity, initiatives like the SAPZ program may struggle to achieve their intended impact.

The Nigerian government’s inability to bring an end to insecurity has left the agricultural sector vulnerable. This ongoing crisis has forced many farmers to abandon their fields, leading to reduced food production, soaring prices, and increased reliance on imports. The situation has also created a deterrent for potential investors in the agro-industrial sector, further complicating efforts to achieve self-sufficiency in food production.

Despite these challenges, the SAPZ program offers hope for Nigeria’s agricultural future. The program seeks to attract private investments, generate employment, and drive economic growth by creating clusters of agro-industrial activities. The soybean refinery inaugurated in Nasarawa represents a critical step in this direction, contributing to import substitution and the development of a value-added agricultural sector.

Dr. Adesina emphasized that the SAPZ initiative is not just about infrastructure and investment but about transforming Nigeria into a hub of agro-industrial excellence. However, experts and stakeholders have noted that the challenges posed by insecurity must be addressed for the program to achieve its full potential.