Sources told SaharaReporters that TAK under Etuh, who was also the President of the Fertiliser Producers and Suppliers Association of Nigeria (FEPSAN), was paid for fake purchases.
The Anchor Borrowers’ Programme under the Development Finance Department of the Central Bank of Nigeria is dogged by corruption, sources told SaharaReporters.
Sources told SaharaReporters how the development finance department of the CBN under its former director, Yusuf Philip Yila gave contracts to cronies and paid for fake purchases under the programme.
Also, the former Chairman of TAK Agro Group, Thomas Etuh, was accused of benefiting from the fraud and diverting proceeds from the sale of fertilizer under the Presidential Fertiliser Initiative (PFI) in connivance with others.
PFI was introduced during the administration of former President Muhammadu Buhari in 2016, to boost domestic production of NPK fertiliser, a vital multi-nutrient mix containing nitrogen (N), phosphorus (P), and potassium (K). Before the PFI, Nigeria heavily relied on imported fertiliser, which means that farmers bought it at a high cost and while it also burdened the national economy.
Under the PFI, the required raw materials for NPK fertiliser – including locally sourced urea and limestone granules, as well as imported phosphate from Morocco and potash from Europe – are to be procured at reduced rates and made available to private blending firms responsible for manufacturing the final products.
However, sources said TAK, a major player in Nigeria's NPK fertiliser industry operating multiple blending plants across the country, produced substandard fertilizer for farmers.
In 2022, Singapore-based chemicals and fertiliser major Indorama acquired a 51% stake in TAK Agro & Chemicals.
With this deal, Indorama gains direct access to the NPK fertiliser market in Nigeria but SaharaReporters learnt that the management of the foreign company was shocked by the rot in the indigenous company.
Indorama was not totally new to the system; it had been supplying urea to support the PFI and private blenders since 2017. With the acquisition of TAK, Indorama was able to sell NPK fertilisers directly to Nigerian farmers.
Sources told SaharaReporters that TAK under Etuh, who was also the President of the Fertiliser Producers and Suppliers Association of Nigeria (FEPSAN), was paid for fake purchases.
“CBN Development Finance Department under Yusuf Yila gave contracts to cronies. They would buy fertilisers and Thomas Etuh was the owner of TAK so they were paid for fake purchases.
“When Tinubu won the presidential election and became the President, they wrote to him to let them share the excess fertilizer but the governors said no, we won’t let you share the fertilisers.
“Central Bank under (Folashodun) Shonubi being part of the game, quickly approached the president to use the fertiliser with TAK for palliative. The president approved it but the governors rejected it because they knew that the fertilisers did not exist. By the time Indorama took over TAK, they realised the deal. They have been struggling to sell the substandard NPK,” one of the sources said.
“Thomas Etuh sold his TAK to Indorama and ran away. Now, the Economic and Financial Crimes Commission and the Department of State Services (DSS) have told the CBN to sell the fertilizer and they know it does not exist,” another source said.
A letter obtained by SaharaReporters titled ‘Request For Allocation Of Central Bank Of Nigeria (CBN) Fertilizer Stock,’ shows the details of how the apex bank offered to sell a bag of NPK 15:15:15 for N24,000; a bag of NPK 27:13:13 for N22,500, a bag of NPK 20:10:10 for N22,350, a bag of urea for N21,000 and a bag of SSP for N23,000.
In June 2023, according to a petition seen by SaharaReporters, not less than N300 billion had been siphoned from the PFI between 2017 and 2020.
Since the PFI was established by the government to provide quality fertilizers to farmers across Nigeria at low rates and to aid agricultural production, harvest and provision of food security for the country, it proposed that fertilisers would be locally blended at N5,000 per bag and sold out to farmers at N5,500 per bag.
Local blenders were provided funds from the Nigeria Sovereign Investment Authority without any interest or collateral and they were to import raw materials from Morocco under NAIC.
In the petition, it was alleged that TAK Agro headed by Etuh and his cohorts connived with NAIC and loaded raw materials of 27 to 28 tons instead of 30 tons and diverted the difference for their private use and sold them to other blending plants.
TAK Agro was also handling logistics, thereby making it easy to perfect the fraud in collaboration with others in government agencies.
The shortage was calculated in billions of naira and memos would then be raised to the Federal Government, which would make payment.
Furthermore, the quality of fertilizers being blended was described as low. It contained high Kaolin, sand, and low percentage of Nitrogen, MOP and DAP and was being packaged into bags without proper scaling, making the content below the recommended and inscribed 50kg.
Most of the fertilizer bags were said to be between 40kg and 45kg.
Additionally, the culprits reportedly supply fertilisers at N7,500/bag under the Anchor Borrowers’ Programme instead of the agreed N5,500.
This was made possible because of the connivance of the Central Bank’s Anchor Borrowers’ Programme department, making it possible for the diversion of funds into private pockets.
This reportedly went even though the ABP was a loan to farmers, who were expected to back after harvest.
However, Etuh in a statement released in August 2020, described the allegations as baseless.
“There is no way this could ever have been possible, given that N300 Billion is the equivalent of $783 million at the exchange rate of N383 to $1 or $923 Billion if we use the base rate of N325 to the $1 as was the case in 2017.
“It is then easily verifiable that the PFI is project, which is managed on borrowed funds under the CBN’s Real Sector Support Funds (RSSF) could never have accumulated such sum, knowing that as at 2017 the entire borrowing was no more than N50 billion.
“It is important to also emphasise that this sum is a loan that has to be paid back with interest. So even if you accumulate the total loan sum from 2017 to date it, does not amount to N300 billion, making it impossible, for N300 billion have been siphoned from the programme,” he stated.
Efforts to reach the spokesperson for the CBN, Hakama Sidi Ali, to explain among others why the apex bank was directly buying and selling fertiliser, and how it ensured that the urea nitrate sold didn’t end up in the hands of bomb makers among other questions, failed.
She did not answer her calls or reply to the messages sent to her.