Institute seeks capital market funding to boost agric sector

October 16, 2012 16:39

Audio attached

Institute seeks capital market funding to boost agric sector

NAN-HE-3

Funding

Lagos, Oct. 16, 2012 (NAN) Mr Mike Itegboje, the immediate past President of the Chartered Institute of Stockbrokers (CIS), on Tuesday, advocated for capital market funding to grow the agricultural sector.

 

Itegboje told the News Agency of Nigeria (NAN) in Lagos that that the sector would only experience significant growth through capital market funding.

 

He called on the agricultural banks to source for long-term funds from the capital market instead of depending on funds from the Federal Government.

 

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“The agric bank must not depend on government for funding, agric bank must raise long-term funds from the capital market and that is the way to go. And that way we can help development.

 

``Government has given them some take off funds that will only last a short while and once that money finishes until government brings again, whereas with this funding they can set up a structure that help them to access the market on an annual basis, capital market.

 

‘’They can raise N200, N300 billion or N100 billion as the case may be annually, so they have sustainable funding.

 

``Farmers and all those interested in agric business can access such fund and because it is long-term in nature and interests are lower the farmers can pay lower interest instead of paying commercial rates.’’

 

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Itegboje, who is also the Chief Executive Officer of The King’s Ltd, a stock broking firm, noted that the capital market was available for borrowers of such funds to exit from.

 

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 ``Nigeria needs agro-based industries that will save the country from spoilage as a result of over surplus and lack of storage facilities.

 

‘’Companies should be encouraged to go into storage and processing and it is only if they have access to long term funds that they can do that. Because they know they are going to invest on to long-term and the funding will require long period for them to recoup their investment.

 

``Therefore, if you have that access it becomes easier and the capital market is available for borrowers of such funds to exit from.’’

 

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Itegboje said that farming had to be large scale for it to be meaningful and for it to be developmental and impact on the population. (NAN)

JNC/PDE/MSAD

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