TheCable

Dapo Awofisayo, the group executive director of CPL Group, says the agricultural sector requires patient capital to experience a turnaround.

In an interview with TheCable, Awofisayo said the COVID-19 pandemic has shown the need to build self-sufficiency in agricultural products and value addition.

Awofisayo, who runs Ore-Irele Oil Palm Company, said the oil palm business has witnessed “a bit of stability” amidst the pandemic.

“The rate of growth of our population though not convincingly proven statistically shows that population growth outpaces local production capacity,” he said.

“As a country, we are self-sufficient in the production of rice and cassava now but we need to add many more staples to that list. We also need to increase our processing capacity as well. This will forestall the massive importation we still see to this day.

“Agriculture requires patient capital. The emphasis is on patient. Interest rates should not be more than five percent. Equity contribution required by commercial banks should also be scrapped. Especially if you’re lending to an existing business with a good track record, balance sheet and cash flow.

“Recent investments in processing like that of JB Farms in Oil Palm, Tomato Jos company in Tomato Processing etc are encouraging and shows the potential of our country in value addition.”

Speaking on the strategy that could be adopted by businesses to stay afloat, Awofisayo advised that conservative measures should be adopted.

“None of us has ever experienced a pandemic, so we are all amateurs in this regard. Streamline activities and cut costs, is what I will tell anyone.

“Generally, economic activities have been slow but over the past few weeks, we have seen activities picking up. Nonetheless, this is the time to be conservative in our businesses.”

Since the pandemic began, the federal government and the Central Bank of Nigeria (CBN) has unveiled relief policies to help mitigate the effect of the pandemic on businesses.

This includes the reduction of interest rate on manufacturing and loans to five percent and reduction of fertiliser prices.