Fishery terminals

Fishery terminals
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Fishery terminals
SectorMost major industry classification systems use sources of revenue as their basis for classifying companies into specific sectors, subsectors and industries. In order to group like companies based on their sustainability-related risks and opportunities, SASB created the Sustainable Industry Classification System® (SICS®) and the classification of sectors, subsectors and industries in the SDG Investor Platform is based on SICS.
Food and Beverage
Food and Agriculture
Business Model Description

Construct and operate sustainable fishery terminals for large-scale fish cultivation, processing, storage and packaging.

Expected Impact

Improve livelihood prospects for smallholder producers and improve the nutritional situation of women and children.

Indicative ReturnDescribes the rate of growth an investment is expected to generate within the IOA. The indicative return is identified for the IOA by establishing its Internal Rate of Return (IRR), Return of Investment (ROI) or Gross Profit Margin (GPM).
20% - 25% (in ROI)
Investment TimeframeDescribes the time period in which the IOA will pay-back the invested resources. The estimate is based on asset expected lifetime as the IOA will start generating accumulated positive cash-flows.
Short Term (0–5 years)
Market SizeDescribes the value of potential addressable market of the IOA. The market size is identified for the IOA by establishing the value in USD, identifying the Compound Annual Growth Rate (CAGR) or providing a numeric unit critical to the IOA.
60% of Nigeria's fish demand is covered by imports.
Average Ticket Size (USD)Describes the USD amount for a typical investment required in the IOA.
USD 1 million - USD 10 million
Direct ImpactDescribes the primary SDG(s) the IOA addresses.
No Poverty (SDG 1) Zero Hunger (SDG 2) Good health and well-being (SDG 3)
Indirect ImpactDescribes the secondary SDG(s) the IOA addresses.
Gender Equality (SDG 5) Reduced Inequalities (SDG 10) Life Below Water (SDG 14)
Country
Regions
  • Nigeria: South West
  • Nigeria: South South (Niger Delta)
SectorMost major industry classification systems use sources of revenue as their basis for classifying companies into specific sectors, subsectors and industries. In order to group like companies based on their sustainability-related risks and opportunities, SASB created the Sustainable Industry Classification System® (SICS®) and the classification of sectors, subsectors and industries in the SDG Investor Platform is based on SICS.
Food and Beverage
FB

Development need: About 25.5% of Nigeria’s population lacks adequate and improved nutrition.(1) Similarly, data from the National Bureau of Statistics suggests 26.4% of the population experienced severe food insecurity in 2016.(1) The Sustainable Development Report ranks Nigeria number 48.0 for SDG 2 (Zero Hunger). While performance against this Goal has improved, major challenges persist.(2)

Policy priority: The government intensified efforts to improve agricultural yield, and investments aim to improve agricultural infrastructure.(1) Policy priorities outlined in the Economic Recovery and Growth Plan aim to: increase agricultural GDP (gross domestic product) to NGN 21.0 trillion in 2020 at an average annual growth rate of 6.9%; reduce food imports; and become a key exporter of agricultural products.(3)

Gender inequalities and marginalization issues: Agriculture and trade account for the majority of Nigeria's employment opportunities. Most people in these sectors work informally (92% of those employed in agriculture, and 56% of those employed in trade), and so rely on daily wages. Generally, informal workers have no pension or life insurance, and have limited health insurance coverage. They are more exposed to shocks, especially to their health, and are vulnerable to poverty and hunger. Micro, small and medium enterprises (MSMEs) are most likely to be affected by the upcoming recession, and will take longer to overcome the economic impacts of COVID-19.(4)

Investment opportunities introduction: The government is also considering strategies such as providing irrigation infrastructure to enable year-round production to boost agricultural productivity.(3)

Key bottlenecks introduction: The Sustainable Development Report ranks Nigeria number 48.0 for SDG 2 (Zero Hunger). While performance against this Goal has improved, major challenges persist.(2)

SubsectorMost major industry classification systems use sources of revenue as their basis for classifying companies into specific sectors, subsectors and industries. In order to group like companies based on their sustainability-related risks and opportunities, SASB created the Sustainable Industry Classification System® (SICS®) and the classification of sectors, subsectors and industries in the SDG Investor Platform is based on SICS.
Food and Agriculture
FB.1

Development need: In 2018, agriculture accounted for 21.2% of Nigeria's GDP (gross domestic product) and employed two-thirds of the working population.(3) Indicators of adult obesity have improved, while indicators of undernourishment have underperformed. Prevalence of stunting in children is falling.(5)

IndustriesMost major industry classification systems use sources of revenue as their basis for classifying companies into specific sectors, subsectors and industries. In order to group like companies based on their sustainability-related risks and opportunities, SASB created the Sustainable Industry Classification System® (SICS®) and the classification of sectors, subsectors and industries in the SDG Investor Platform is based on SICS.
Agricultural Products
FB-AG
Investment Opportunity Area

Fishery terminals

Business Model

Construct and operate sustainable fishery terminals for large-scale fish cultivation, processing, storage and packaging.

Critical IOA UnitDescribes a complementary market sizing measure exemplifying the opportunities with the IOA.
60% of Nigeria's fish demand is covered by imports.

Nigeria has a prominent fish industry, which accounts for 3%-4% of the country's gross domestic product (GDP). Fish consumption constitutes approximately 50% of the population's animal protein intake.(7)

Despite a large potential for both marine and freshwater fish cultivation, imports account for around 60% demand.(7) This gap could be filled by domestic production.

Increased food production (especially rich in proteins) will improve population wellbeing and reduce food insecurity. There’s high demand for fish products (3.3 million metric tonnes), e.g. tilapia, catfish, and mackerel (salmon).(6)

ROIDescribes an expected return from the IOA investment over its lifetime.
20% - 25%

Fish farming, if done with expert knowledge and deep market understanding, can generate 20% - 25% returns on investment in Nigeria.(8)

Examples from around the world prove impact-oriented businesses profiting from stock stabilization or restoration can generate returns on equity ranging from 5% to 35%.(9)

TimeframeDescribes the time period in which the IOA will pay-back the invested resources. The estimate is based on asset expected lifetime as the IOA will start generating accumulated positive cash-flows.
Short Term (0–5 years)

The investment timeline for lake fish farming is 3-4.5 years.(10)

The investment recovery period varies from 1 year to 4 years, depending on the size and type of investment - revitalize old fishery terminals and/or build new terminals.(11)

Average Ticket Size (USD)Describes the USD amount for a typical investment required in the IOA.
USD 1 million - USD 10 million
Business - Supply Chain Constraints
Nigeria’s relatively narrow continental shelf places excessive pressure on inshore fisheries.(12) Oil spills from inshore and offshore oil exploration can also affect water chemistry and lead to fish kills.(13)
Capital - Limited Investor Interest
Some fishery terminals were abandoned due to little or no finance for maintenance from government for many years.(14) The industry also experienced under-developed technology for sustainable aquaculture production in land-based industrial mariculture.(15)
Market - Geographic conditions
Natural factors - salinity, wind speed and direction, ocean currents, nutrient availability, carbon dioxide concentration in the ocean, strength of upwelling, rain and snow, as well as the interaction among these different factors.
Sustainable Development Need

Nigeria has a 2.2 million metric tonne demand gap for fish, which is largely covered by imports.(6)

Nigeria’s population is growing at a steady rate of 2.6% annually (16), and is projected to reach 262 million people by 2030.(17) This will call for increased food production to satisfy increased protein demand.

Aquaculture is also an attractive sector for policymakers because it employs 8.6 million people directly and a further 19.6 million people indirectly.(18)

Gender & Marginalisation

Nigerian women play a predominant role as hired workers in semi-intensive operations, accounting for 70% of workers involved in aquaculture processing.(18)

Sustainable investments in the sector will support job creation among youth, females, increased household income, improved nutrition and reduced child mortality.

Expected Development Outcome

Investments will help improve food security, increase protein intake and decrease food waste.

Investments in this IOA will also help increase the aggregate income of fishers and fishing communities, empower fishing communities and fishers, improve fishing community resilience and close infrastructure gaps.

Gender & Marginalisation

Investments will improve labour conditions of workers, especially women and youth.

Primary SDGs addressed
1 - No Poverty
No Poverty (SDG 1)

1.2.2 Proportion of men, women and children of all ages living in poverty in all its dimensions according to national definitions

Current Level

42.2% in 2017. (29)

Target Level

21.1% by 2030. (29)

2 - Zero Hunger
Zero Hunger (SDG 2)

2.2.2 Prevalence of malnutrition (weight for height >+2 or <-2 standard deviation from the median of the WHO Child Growth Standards) among children under 5 years of age, by type (wasting and overweight)

2.4.1 Proportion of agricultural area under productive and sustainable agriculture

Current Level

16.4% in 2015. (30)

56.6% in 2015. (30)

Target Level

Derived ERGP (Economic Recovery and Growth Plan) target by 2020: 10.9, by 2030: 0. (30)

Derived ERGP (Economic Recovery and Growth Plan) target by 2020:71.1%, by 2030: 100%. (30)

3 - Good Health and Well-Being
Good health and well-being (SDG 3)

3.2.1 Under‑5 mortality rate

3.2.2 Neonatal mortality rate

Current Level

132 (29)

36 per 1,000 births (32)

Target Level

By 2030, end preventable deaths of newborns and children under 5 years of age, with all countries aiming to reduce neonatal mortality to at least as low as 12 per 1,000 live births and under-5 mortality to at least as low as 25 per 1,000 live births. (29)

The long term objective for this indicator is a value of 1.1. (32)

Secondary SDGs addressed
5 - Gender Equality
Gender Equality (SDG 5)
10 - Reduced Inequalities
Reduced Inequalities (SDG 10)
14 - Life Below Water
Life Below Water (SDG 14)
Directly impacted stakeholders
People
Households, fisheries' workers, small-scale fisheries
Gender inequality and/or marginalization
Fisheries' workers (especially women)
Corporates
Small and medium enterprises, markets, processing facilities, wholesalers, retailers
Outcome Risks

Fishery production may lead to pollution in aquatic environments and habitat degradation.

Investments may lead to negative implications caused by human factors such as overfishing, environmental activities, climate change, population increases and ghost fishing.

Impact Risks

Unexpected impact risk given the negative habitat effects of overfishing, which may endanger life below water.

Alignment risk given production may not be locked into an enterprise model.

Stakeholder participation risk given increasing scale may threaten livelihoods by smallholder fishery producers.

What

Creation of fishery terminals is likely to have a positive impact by increasing the value of the fish supply chain, increasing fishers' incomes (including females) and creating new workplaces for vulnerable groups.

Who

The population that suffers from inadequate access to food with emphasis on proteins.

Risk

Although the model is market proven, the environmental factors, overfishing and resistance from artisanal fishers can pose a risk for the model scaling.

Impact Thesis

Improve livelihood prospects for smallholder producers and improve the nutritional situation of women and children.

Policy Environment

National Agriculture Policy: Fisheries are a key pillar of the Nigerian food sector. The National Agriculture Policy recognizes fish as one of the major protein sources in people's diets, and outlines an approach to achieving domestic production sufficiency to minimize imports.(19)

Nigeria's Minister of Agriculture and Rural Development Sabo Nanono said Nigeria may stop fish imports by 2022. He stated it was time for Nigeria to tap into the huge potential of fisheries and aquaculture for local consumption and export.(19)

Since 2000, the Nigerian Government has recognized the importance of fisheries by carrying out related programmes and projects to train and equip farmers with necessary knowledge and resources for fish farming.(20)

Financial Environment

Fiscal incentives: A 30% tax concession is available for 5 years to industries that attain a minimum 80% of local raw materials utilization in agribusiness. A 5% tax concession for 5 years depends on the number of employees.(27)

Other incentives: A 10% tax concession is available for 5 years to industries that export not less than 6% of their products. (27)

Regulatory Environment

Sea Fisheries Act of 1971: This Act makes provisions to control, regulate, and protect marine fisheries in Nigeria's territorial waters.(21)

Sea Fisheries (Licensing) Regulations of 1971 and 1972: These regulations contain provisions on licensing motor fishing boats (22) and restrict fishing trawlers from operating within the first 2 nautical miles of the continental shelf.(23)

Exclusive Economic Zone Decree of 1978: This decree empowers Nigeria to extend its territorial waters by an additional 200 nautical miles seaward from the coast.(24)

Sea Fisheries Decree of 1992: This decree covers licensing of motor fishing boats, penalties for unlicensed motor fishing boats enjoying the rights of licensed boats, powers and duties of licensing officers, and penalties for violating the provisions. It replaces the 1971 Sea Fisheries Act.(25)

1995 Sea Fisheries Regulations: These regulations supplement the Sea Fisheries Decree 1992. In particular, the "Fish Inspection and Quality Assurance" section concerns the control of fishery products.(26)

Private Sector

Nigeria Farmer's Group, Cephas Agricultural Management, Aqua-Agro Farmers, A.S.A. Farms, Tunraven Resources Ltd, Happy Home Foods and Products Ltd, Goatti, Group Farma, Farmkart, Pay Farmer

Government

Federal Ministry of Agriculture, Nigerian Incentive-Based Risk Sharing System for Agricultural Lending (NIRSAL), Central Bank of Nigeria

Multilaterals

Food and Agriculture Organization of the United Nations (FAO), International Fund for Agricultural Development, Cultivating New Frontiers in Agriculture (CNFA), African Development Bank (AfDB)

Non-Profit

Acumen Fund

Public-Private Partnership

Africa Agriculture and Trade Investment Fund (AATIF)

country static map
semi-urban
Nigeria: South West
The best destinations for fish cultivation in Nigeria are the coastal states: Lagos, Ogun, Ondo, Delta, Cross River, Akwa Ibom, Rivers and Bayelsa.
semi-urban
Nigeria: South South (Niger Delta)
The best destinations for fish cultivation in Nigeria are the coastal states: Lagos, Ogun, Ondo, Delta, Cross River, Akwa Ibom, Rivers and Bayelsa.
Sector Sources
  • 1) Federal Republic of Nigeria (2017). Implementation of the SDGs: a national voluntary review. https://sustainabledevelopment.un.org/content/documents/16029Nigeria.pdf 2) Sachs, J., Schmidt-Traub, G., Kroll, C., Lafortune, G., Fuller, G. (2019). Sustainable Development Report 2019. New York: Bertelsmann Stiftung and Sustainable Development Solutions Network (SDSN). 3) Federal Republic of Nigeria (2017). Economic Recovery and Growth Plan 2017 - 2020. Abuja: Ministry of Budget and National Planning. 4) Dalberg (2020). Charting the future for Africa's largest economy: Economic impact of COVID-19 in Nigeria. https://dalberg.com/wp-content/uploads/2020/04/FINAL_Dalberg-Report-Charting-the-Future-of-Africa%E2%80%99s-Largest-Economy.pdf 5) Federal Republic of Nigeria (2011). Agricultural Transformation Agenda 2011.
IOA Sources
  • 6) The Embassy of the Kingdom of the Netherlands, Lagos Office (2019). Aquaculture in Nigeria Factsheet 2019. https://www.agroberichtenbuitenland.nl/binaries/agroberichtenbuitenland/documenten/publicaties/2019/01/23/factsheet-aquaculture-in-nigeria/Aquaculture+in+Nigeria.pdf 7) Food and Agriculture Organization of the United Nations (2020). FAO in Nigeria. http://www.fao.org/nigeria/fao-in-nigeria/nigeria-at-a-glance/en/ 8) Farm Republic. Fish Farming and Its Revenue Potentials in Nigeria. https://www.farmrepublic.ng/fish-farming-and-its-revenue-potentials-in-nigeria/ 9) Encourage Capital (2016). Investing for Sustainable Global Fisheries. http://investinvibrantoceans.org/wp-content/uploads/documents/FULL-REPORT_FINAL_1-11-16.pdf 10) African Green Revolution Forum (2020). The Agribusiness Deal Room at the 2019 African Green Revolution Forum (AGRF). https://agrf.org/dealroom/wp-content/uploads/2020/07/Agribusiness-Deal_Room-AGRF-booklet_020919.pdf 11) Escobedo Rupay, J. and Castellares Fernandez, M. (2013). Plan de negocio “Comercialización de jurel y caballa en Lima Metropolitana”, https://repositorioacademico.upc.edu.pe/bitstream/handle/10757/316209/escobedo_rj-rest_.pdf?sequence=2&isAllowed=y 12) The Guardian (2020). FG pledges to revitalise two fishing terminals in Akwa Ibom. https://guardian.ng/news/fg-pledges-to-revitalise-two-fishing-terminals-in-akwa-ibom/ 13) Transportation Research Board and National Research Council (2003). '5 Biological Effects of Oil Releases.', in Oil in the Sea III: Inputs, Fates, and Effects. Washington, DC: The National Academies Press. doi: 10.17226/10388. 14) The Guardian (2020). FG pledges to revitalise two fishing terminals in Akwa Ibom. https://guardian.ng/news/fg-pledges-to-revitalise-two-fishing-terminals-in-akwa-ibom/ 15) Oluwatobi, A.A., Mutalib, H.A., Adeniyi, T.K., Olabode, J.O. and Adeyemi, A. (2017). 'Possible Aquaculture Development in Nigeria: Evidence for Commercial Prospects'. Journal of Agricultural Science and Technology, B7, 194-205. https://pdfs.semanticscholar.org/fc46/3f86f68cd7995fcfedbb4a6619d2691980e1.pdf?_ga=2.44318572.931950668.1594200969-181587615.1594200969 16) World Bank Database. 17) Inter-Agency Regional Analysts Network (2016). Nigeria Trend Analysis: Challenges and Opportunities of the Demographic Shift and Its Link to Stunting An Outlook To 2030. https://www.iris-france.org/wp-content/uploads/2016/09/NGA-Trend-Analysis-Demography-Stunting.pdf 18) WorldFish (2018). WorldFish Nigeria Strategy 2018–2022. https://digitalarchive.worldfishcenter.org/handle/20.500.12348/673 19) Federal Ministry of Agricultural and Rural Development. Agricultural Policy for Nigeria. http://extwprlegs1.fao.org/docs/pdf/nig149296.pdf 20) Farm Republic. Fish Farming and Its Revenue Potentials in Nigeria. https://www.farmrepublic.ng/fish-farming-and-its-revenue-potentials-in-nigeria/ 21) Sea Fisheries Act. http://extwprlegs1.fao.org/docs/pdf/nig5318.pdf 22) Sea Fisheries (Licensing) Regulations 1971. http://www.fao.org/faolex/results/details/en/c/LEX-FAOC005324/ 23) Sea Fisheries (Fishing) Regulations 1972. http://extwprlegs1.fao.org/docs/pdf/nig5321.pdf 24) United Nations (1978). Exclusive Economic Zone Decree No. 28 of 5 October 1978. https://www.un.org/Depts/los/LEGISLATIONANDTREATIES/PDFFILES/NGA_1978_Decree.pdf 25) Sea Fisheries Decree no. 17 of 1992. https://sherloc.unodc.org/cld/uploads/res/document/sea-fisheries-decree-1992_html/Sea_Fisheries_Decree.pdf 26) Sea Fisheries (Fish Inspection And Quality Assurance) Regulations 1995. http://extwprlegs1.fao.org/docs/pdf/nig120902.pdf 27) Federal Republic of Nigeria (2021). Investment Incentives in Nigeria. http://www.nigeriaembassyusa.org/index.php?page=investment-incentives 28) Logistics Update Africa (2020). Nigerian government to reactivate two dilapidated fishing terminals in Akwa Ibom. https://www.logupdateafrica.com/nigerian-government-to-reactivate-two-dilapidated-fishing-terminals-in-akwa-ibom-shipping 29) Federal Republic of Nigeria (2020). Integration of the SDGs into National Development Planning: A Second Voluntary National Review (2020). https://sustainabledevelopment.un.org/content/documents/26309VNR_2020_Nigeria_Report.pdf 30) Federal Republic of Nigeria (2017). Implementation of the SDGs: a national voluntary review. https://sustainabledevelopment.un.org/content/documents/16029Nigeria.pdf 31) UNDP, Human Development Report (2020). Available at: https://www.ng.undp.org/content/nigeria/en/home/library/human_development/the-2020-human-development-report.html 32) Sachs, J., Schmidt-Traub, G., Kroll, C., Lafortune, G., Fuller, G., Woelm, F (2020). The Sustainable Development Goals and COVID-19. Sustainable Development Report 2020. Cambridge: Cambridge University Press. https://dashboards.sdgindex.org/profiles/NGA