Nigeria is pushing to establish a robust national climate finance framework aimed at unlocking up to $30 billion in annual climate adaptation investments for smallholder farmers. Experts at a recent industry gathering demanded targeted financial instruments, digital accountability, and stronger commercial lending mechanisms to support the sector.
The initiative seeks to improve funding access for millions of rural farmers exposed to severe environmental shocks, including recurring droughts in the North and persistent flooding across southern agricultural belts.
Defining green frameworks
Speaking at a Taxonomy Validation Workshop on Adaptation and Resilience Solutions, co-organised with YAPU Solutions, Presidential Implementation Committee on Technology Transfer (PICTT) Chairman Dahiru Muhammed emphasised that a clear framework is crucial to attracting foreign green capital.
He explained that while the Federal Ministry of Finance and the United Nations Development Programme (UNDP) are driving the overarching national taxonomy, PICTT and its technical partners are focused on operationalising the model for rural adoption.
“Having a national taxonomy is good, but without defining which activity qualifies as adaptive or resilient to climate change, there is no way you can access the financing,” Muhammed said, clarifying that stakeholders are currently laying the groundwork to onboard global funding partners.
He added that governments at the federal, state and local levels must work together to address climate-related challenges, particularly flooding, through improved infrastructure and effective mitigation measures. On PICTT’s achievements, he highlighted its work in technology transfer, agricultural development and helping entrepreneurs transform research into commercially viable products.
Regional strategies and funding
WorldFish in Nigeria Country Representative Charles Nyangbe stressed that generic funding mechanisms are insufficient. He called for region-specific financial instruments, such as index-based insurance and blended finance models, to de-risk agricultural lending.
“Government should come up with an envelope of funding that is targeted at climate financing, give it to financial institutions, give it to commercial banks so that they can lend,” Nyangbe noted, advocating for public funds to be used as credit guarantees to unlock commercial bank balance sheets.
Nyangbe noted that Nigeria had attracted about $2.5 billion for climate-related financing, but the amount remained significantly below estimated requirements. He further called for greater attention to livestock, fisheries and aquaculture, arguing that climate financing discussions often focused excessively on crop commodities. He noted that flooding could destroy fish ponds and aquaculture facilities, causing substantial losses for farmers.
Technology and accountability in Adaptation
YAPU Solutions Managing Director Christoph Junghleisch estimated that climate adaptation presented an investment opportunity of up to $30 billion annually for smallholder farmers. He said the organisation was working with PICTT to establish a framework connecting climate adaptation solutions with appropriate financing.
Junghleisch said initial plans could involve a pilot project worth between $100 million and $200 million, with the ambition of scaling up financing to $1 billion in the first expansion phase. However, he clarified that these figures represented targets rather than confirmed funding commitments.
He identified digital technology as central to ensuring transparency and accountability, explaining that the proposed system would digitally document funds reaching smallholder farmers and make transactions auditable.
“What we are focusing on is smart use of technology, optimisation of processes that enable you to document each and every cent, Naira, that you are basically bringing to the smallholder farmers,” he said.
Junghleisch added that YAPU was engaging development finance partners, including the Bank of Agriculture and the African Development Fund, while seeking to attract private-sector investment. He stressed that government support through appropriate policies, legislation and regulations would be essential, although public funding alone could not meet the scale of investment required.
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