Abuja, Nigeria, 8 August 2022 – The Islamic Development Bank (IsDB) and the Government of Nigeria have signed a US$150 million financing agreement for a flagship project that provides extensive support to the country’s food security.

The agreement signed on 8^th August 2022 is part of a mega co-financing effort for the launching of the Special Agro-Industrial Processing Zone (SAPZ) Project in the Federal Republic of Nigeria.

On the occasion, IsDB President and Group Chairman, H.E. Dr. Muhammad Al Jasser, has stated: “The Project can play a key role in pushing Nigeria’s economic recovery in the post-pandemic period. Given that Nigeria has a high agricultural potential, SAPZ will help in boosting the country’s agricultural supply chain. With this in mind, tapping prospects in a special agro-industrial processing zone and pushing for its advancement is one way to achieve inclusive growth and sustainable development in Nigeria.”

Signatories to the agreement were IsDB President and Group Chairman, H.E. Dr. Muhammad Al Jasser, and Dr. Zainab Shamsuna Ahmed, Federal Minister of Finance of the Government of the Federal Republic of Nigeria.

The project aims to support the poverty alleviation strategy of the Government of Nigeria, stimulate sustainable activities for low-income households, and enhance the competitiveness of the agriculture sector through the promotion of select value chains in the country.

In addition to the Federal Capital Territory (FCT), SAPZ Program will cover seven other states namely Kaduna, Kano, Kwara, Imo, Cross River, Ogun, and Oyo. IsDB Project will cover FCT, Kano, and Kwara. 

The SAPZ Program bears an estimated cost of US$575 million financed by other international partners including the African Development Bank (AfDB) Group and the International Fund for Agricultural Development (IFAD).

Once operational, the project will support inclusive and sustainable agro-industrial development and enhance the competitiveness of the agriculture sector through the promotion of select value chains.

The key expected outputs of the SAPZ Project under IsDB financing are (i) development of infrastructure for 3 Agro-Industrial Processing Hubs (AIHs); (ii) 10 Agricultural Transformation Centers (ATCs); (iii) improvement of irrigated land & farm to market access roads; (iv) supply of certified agricultural inputs and extension services; (v) skills development for 10,000 farmers and MSMEs; and (vi) updating agro-industrial zone policy and establishment of a regulatory institution/special regulatory regime.

The outcome level results are: (i) increasing investments by private sector companies within the AIHs by US$375 million; (ii) creating 185,000 new jobs, including 50% for women and 50% for youth; (iii) increasing the yields of key crops by at least 50%; (iv) reducing post-harvest losses within the catchment area by at least 10-20%; and (v) increasing in the income of small producers/farmers by 25%.

SAPZs Project in Nigeria is well-aligned with IsDB Group’s Realigned Strategy (TYS), as it relates to food security, private sector development, and inclusive growth. The Project is also in line with the IsDB’s ARD sector strategies and policies. The project is also in consonance with the IsDB Climate Change Policy, Women and Youth policy, and Environmental and Social Safeguard.

In addition, the Project will contribute to the Government's effort in achieving its SDG targets, specifically on the following: SDG1, SDG2, SDG5, SDG9, SDG12, SDG13 & SDG17.

Nigeria became a member of the IsDB Group in 2005. The country is a key beneficiary of the IsDB financing in Africa with a total portfolio of approved operations amounting to US$ 1.8 billion. IsDB Group's financial support for Nigeria is diverse, covering broad sectors of the economy. Agriculture infrastructure projects account for 29 % of IsDB's financing for Nigeria, followed by health (18%), transportation (17%), and water (15%), among others. The Bank also has a solid pipeline of projects to be processed between 2022 and 2023.