nwakibie3:
By Bamidele Samuel Adesoji - August 15, 2019

President Muhammadu Buhari gave a new directive to the Central Bank of Nigeria (CBN) to stop providing FOREX for food importation. According to the President, the directive was given to improve agricultural production and attain full food security in Nigeria.

The President reportedly said, “The Central Bank of Nigeria should stop providing foreign exchange for importation of food into the country, with the steady improvement in agricultural production, & attainment of full food security.”

Implications of the President’s Statement

Note that rice and other items make up the 43 items earlier placed under FOREX restriction. Hence, the latest announcement is apparently a follow-up to the recent move by the CBN to restrict FOREX for milk importation.

Following this, If all food items are declared ineligible for FOREX during importation, it means that importers will no longer have access to the Investors & Exporters Window (I&E) for foreign currencies required to carry out transactions.

Consequently, the investors will have to source their own FOREX by patronising bureau de change or other sources. This comes at a higher cost and the implication is that consumers will be made to bear the brunt of the extra costs incurred by the investors.

On the flip side, the President also stated that Nigeria has recorded steady improvement in food production and attained full food security. This suggests that the President is of the opinion that Nigeria has attained food self-sufficiency, thereby making food importation unnecessary.

A look into Nigeria’s Agricultural sector

According to Food and Agriculture Organization (FAO), although agriculture remains the largest sector of the Nigerian economy, employing two-thirds of the entire labour force, production hurdles have significantly stifled the performance of the sector.

FAO further revealed that the main factors undermining production of agricultural products include reliance on rainfed agriculture, smallholder land holding, and low productivity due to poor planting material, low fertilizer application, and a weak agricultural extension system, amongst others.

- As a result of the several factors inhibiting the growth of the sector, food remains one of the major commodities currently being imported into Nigeria.

- As it stands, Nigeria occupies a tripartite position. FAO reported that Nigeria is the continent’s leading consumer of rice; the country is one of the largest producers of rice in Africa and simultaneously one of the largest importers of rice in the world.

- Livestock development is an important component of Nigeria’s agriculture sector with abundant social and economic potentials. However, 30% of live animals slaughtered in Nigeria are imported from neighbouring countries.

Food Importation Statistics

A close look into the National Bureau of Statistics (NBS) foreign trade report shows that Nigeria still imports food items that gulp trillions of naira. According to the Bureau, between 2015 and 2018, Nigeria imported food and beverages estimated at N5.46 trillion or $17.8 billion. As at first quarter of 2019 only, Nigeria’s food and beverage importation stood at N389 billion or $1.2 billion.

- A further breakdown shows that Nigeria’s food imports are categorised into primary (raw) and processed. In Q1 2019, industries imported N196 billion worth of raw food, while households imported N87 billion.

- For processed food, industries imported an estimated N82 billion worth of food items, while household consumption of processed food was put at N110 billion.

- This means that a total of N389 billion was spent on both industrial and household food importation in Q1 2019.
According to the NBS, food items largely imported into Nigeria include prepared foodstuffs, vegetables, animals, vegetable fats and oil, other cleavage production and beverages.

Some concerns

Mixed reactions have continued to trail the directive. While much emphasis has been placed on whether the move is an apparent breach of the CBN’s independence or not, some have asserted that the announcement might worsen the economy as Nigeria has neither achieved food security nor sufficiency.

Reacting to the policy, a former Deputy Governor of the CBN, Kingsley Moghalu, reacted that the issue isn’t whether or not CBN should allow access to Forex for food imports. According to him, it is about whether such an economic policy should be imposed by a political authority. Moghalu said, “Our economy will not be saved by Ad Hoc political decisions like this, handed down by the very institutions that should be shielded from the whim and caprice of politicians.

“Nigeria’s entire economy appears to have been sub-contracted to our Central Bank, including industrial and trade policy. In the process, the economy has fared poorly, and the Central Bank has lost its independence. This is sad!”

The downsides

No doubt, Nigeria’s agricultural sector is full of potential and there is a large room for growth. While the current administration has introduced several policies to help improve food security, not much progress has been recorded and the government should address this.

- According to global hunger index (GHI) 2018, Nigeria ranks 103 out of the 119 qualifying countries with a score of 31.1. This means Nigeria suffers from a level of hunger that is very serious.

- A closer look at GHI report shows that Nigeria is worse off in hunger index between 2000 and 2018.

- Nigeria’s fragile economy still manages to import more Agric. products than export. This means that the current domestic production cannot meet demands.

- While FOREX restriction on food importation is laudable, the government needs to carefully work on the gradual implementation of the policy in order not to heap more misery on the economy.


https://nairametrics.com/2019/08/15/buharis-food-importation-ban-could-drag-the-nigerian-economy-into-misery/

With farmers-herdmen crisis, hunger will reset brain of many. if you want to control forex,stop importation of luxurious and mundane things, not basic things like food and drugs. well,from history, severe hunger is major factor that can trigger revolution spontaneously. irony is that those who are supporting fg policy would suffer more and will be blaming those opposing it for not being patriotic. if hunger-induced revolution happens today, it would be poor v poor, workers v workers, masses v masses. Masses and poor do not know their real enemy.

May The Almighty increase your knowledge.... I don't know what is wrong with them, how can we triumph economically if we keep depending on imports? Anyone against this is either a dullard, hating or benefits as an importer. To hell with them all. IT'S EITHER YOU TALL WITH TINY LEGS OR SHORT WITH THICK LEGS

SillyMods:
Disgraceful youths.

Buhari has proved to be wiser and smarter than our so-called economists who know nothing about practicals but theory.

Many times Buhari has floored them on economics matter:

1. During the debate to fully float the Naira against the president's position not to do so, Buhari was eventually proved correct by attaining exchange rate stability without floating the currency.

2. PMB, against noise and wailing banned access to 42 items including toothpicks to save dollars. Today, most of those items are locally produced thereby creating local jobs and increasing wealth for the entrepreneurs who took adantage.

This time, the best president in Nigeria's history says that in a bid to encourage local food producers and make them competitive, the CBN should not provide dollars to food importers. Wailers and wailing zombies are masturbating and bringing up voodoo economics to tell us why it is wrong for the president to say/do so. Please tell us how best to encourage local production if not by making them more competitive? How can people produce locally if the imported goods remain cheap or slightly dearer?

Una no get sense I swear. And this senseless thinking is being led by a wannabe presidential candidate who was a deputy governor of CBN when GEJ sacked Sanusi. The idiot stood by GEJ. He was also alive when Jona the fisherman was ordering Emefiele to release billions of dollars for looting (in the name of fighting insurgency) but kept quiet.

IPOBites and sense are words and their opposite.

You want Nigeria to be like China, Korea, Japan, etc, but you don't want to take the hard decisions! Hypocrites and unpatriotic souls.

Local rice is now well refined and packed that you'll never see the difference these days else you're not informed... This has reduced rice price drastically. God bless Buhari for this
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Kenturkey048:
chairman I see no reason why you won't identify local rice when you see one....local rice looks and taste different from foreign rice sir...I don deal on both sir...forex ceased kor ,obtain Ni...price of rice dropped from 22 to 12 in Lagos state alone or your village included Bros say what you know abeg...I no go yan too much Mr know all...just wait and see...even Buhari children don't eat locally made rrice...analysis are concluded from several angles..not just imaginations...Mr know all,Nigerians don't like local rice..the little foreign rice smuggled into Nigeria go dey very costly...setting standards without foundation ...

[/s]

SillyMods:

Great contribution

Thanks mate

Pistotita:


And is importation of rice not good? Stop acting ignorant. What you don't know, you don't know. Go and take statistics and see that rice farmers are doing better. Gradually, we will get there. But let him do nothing, and things get worse. You should learn to talk to people respectfully. I suggest Buhari should ban "horror, terrible breath, gutter mouthed" people like you. Go and treat the mouth diarrhea you have that's making you run your mouth without control, before you get punched in your face. Good luck.

this one is actually daft, oh, I see you are one of those suffering and smiling ppl keep it up. even if the quantity of rice produced as of 2015 is doubled (which is not even close), it's still nowhere close to feeding the nation. it's not like the present government is actually helping farmers, the herdsmen are killing them left and right and the gov isn't doing anything. You said gradually getting there when people are dying of hunger every day there is nothing stopping him from producing enough before banning it's common sense(which u both lack), stop being foolish.

Pistotita:


Exactly. I am not a pro Buhari, but he gat this right. There are policies he is bringing out. I am just trying to really see if it is actually Saraki that paralysed his first term like how is people and supporters are saying. Time will tell. But what the presidency is shooting out these days are good.

Good morning to you.

SillyMods:
Disgraceful youths.

Buhari has proved to be wiser and smarter than our so-called economists who know nothing about practicals but theory.

Many times Buhari has floored them on economics matter:

1. During the debate to fully float the Naira against the president's position not to do so, Buhari was eventually proved correct by attaining exchange rate stability without floating the currency.

2. PMB, against noise and wailing banned access to 42 items including toothpicks to save dollars. Today, most of those items are locally produced thereby creating local jobs and increasing wealth for the entrepreneurs who took adantage.

This time, the best president in Nigeria's history says that in a bid to encourage local food producers and make them competitive, the CBN should not provide dollars to food importers. Wailers and wailing zombies are masturbating and bringing up voodoo economics to tell us why it is wrong for the president to say/do so. Please tell us how best to encourage local production if not by making them more competitive? How can people produce locally if the imported goods remain cheap or slightly dearer?

Una no get sense I swear. And this senseless thinking is being led by a wannabe presidential candidate who was a deputy governor of CBN when GEJ sacked Sanusi. The idiot stood by GEJ. He was also alive when Jona the fisherman was ordering Emefiele to release billions of dollars for looting (in the name of fighting insurgency) but kept quiet.

IPOBites and sense are words and their opposite.

You want Nigeria to be like China, Korea, Japan, etc, but you don't want to take the hard decisions! Hypocrites and unpatriotic souls.

Educated illiterate! Even USA and China import food

Kenturkey048:
bros the question is,are we ready to start producing...??its been proven so many times that young nigerians are not ready to go into farming...the unavailability of sustainable working environments in Nigeria is our greatest setback...when bases set,foundation laying becomes juicy ...this would only encourage hike in depended foreign product like rice....me and you no dey chop afada rice,,na imported one we dey chop....even dangote rice,is only packaged in Nigeria...the main stuff is still imported..

66 percent of Nigerias labor force are into farming.So yes , they are more than enough people that are ready to produce.

Wendybrown:


Good morning to you.

Good morning to you too.

blackpanda:


You are not dubai and USA. You dont have the economy of dubai and USA. You dont have their wealth, neither do u export anything other than oil. Agriculture accounts for more than 70% of our economy, its not something we should mortgage out ok

You are wrong , agriculture makes up 21.6 percent of our economy.

urahara:



66 percent of Nigerias labor force are into farming.So yes , they are more than enough people that are ready to produce.

okay sirrr

urahara:


You are wrong , agriculture makes up 21.6 percent of our economy.

oversabi rest

miketayo:


this one is actually daft, oh, I see you are one of those suffering and smiling ppl keep it up. even if the quantity of rice produced as of 2015 is doubled (which is not even close), it's still nowhere close to feeding the nation. it's not like the present government is actually helping farmers, the herdsmen are killing them left and right and the gov isn't doing anything. You said gradually getting there when people are dying of hunger every day there is nothing stopping him from producing enough before banning it's common sense(which u both lack), stop being foolish.

thank you for this....stupid people coming with senseless analyses ..without considering realities on ground...I keep saying building without foundation ...yet the dumb citizens are expecting miracles...e go soon clear for their eyes as usual...I don't have strength to argue with anybody.

jcmaiah:

Educated illiterate! Even USA and China import food

Dull thing, has anyone banned importing of foods? "Go look for your dollars to import foods you want to import" na wahala?

majamajic:


Dubai imports fresh tomatoes and rice from India


are we better than them

Dubai is a desert. We are agrarian economy and we shouldn't have anything to do with importation of foods. Duabai 80 percent of income comes from trade and tourism. Let us take the comparative advantage of our fertile land

walex2:
Dubai is a desert. We are agrarian economy and we shouldn't have anything to do with importation of foods. Duabai 80 percent of income comes from trade and tourism. Let us take the comparative advantage of our fertile land

Turn all of us to farmers

Can't government go into industrial farming ? And produce food in quantity , u will see no one will import , or have u seen someone import akamu or kpomo ?

lexy2014:


What is d ratio of d UK population to its arable land?

The agricultural area used is 23.07 million acres (9.34 million hectares), about 70% of the land area of the United Kingdom. 36% of the agricultural land is croppable (arable), or 25% of the total land area. Most of the rest is grassland, rough grazing, or woodland.

~Agriculture in the United Kingdom - Wikipedia

fortran12:


The agricultural area used is 23.07 million acres (9.34 million hectares), about 70% of the land area of the United Kingdom. 36% of the agricultural land is croppable (arable), or 25% of the total land area. Most of the rest is grassland, rough grazing, or woodland.

~Agriculture in the United Kingdom - Wikipedia

So what is d ratio of d UK population to its arable land?

lexy2014:


So what is d ratio of d UK population to its arable land?

284 ppl per km²
convert how many hectres make a kilometer , get the percnetage of arable land from that and stack against their population density.

fortran12:

284 ppl per km²
convert how many hectres make a kilometer , get the percnetage of arable land from that and stack against their population density.

Is that d reason y they import food?

lexy2014:


Is that d reason y they import food?

I mentioned earlier that one one of the reasons is the land and labor

Khaleell001:


Ate we talking ECA or food related matters?


Focus in the topic and stop this diversionary tactics.

Is ban on Forex for food importers a good thing or a bad thing?
Do you feel it can help our local production or kill it?
And what would you advice if you were to be close to the president?

These are the issues you should focus on not this childish insults you throw around online.

My humble opinion. Do I think the ban is a good thing? Yes
Do I think the timing is wrong? Yes
This was the same thing he did for rice, and the local rice became more expensive than the foreign rice. I think before he bans it he should put mechanism in place to substitute the banned product.

Buhari didn’t build one rice farm or mill, dint empower farmers(at least with low incentives like cheap fertilizer, free course on rice production to intending farmers, machines at discounted prices etc) didn’t absolutely nothing. He just woke up one morning and banned rice. Didn’t you notice that that action increased smugglers, hiked prices, caused a little scarcity then. That is why I said the timing was wrong.

Then GEJ wanted to encourage local cars did he outrightly ban foreign cars? No he first announced that duty on foreign used cars would increase(almost double) that singular action would have made you want to buy a locally produced car.

What I’m trying to say is good idea bad timing, put mechanism in place to attain local sufficiency before banning the foreign ones.

Area4Area:
Need I remind you that at a point under GEJ, Boko Haram controlled a landmass more than Anambra, Imo and Ekiti states combined, not anymore

It’s oly a foooool that will tell you that buhari has achieved anything in the fight against insurgency.

Boko Haram still controls same if not more landmass as at pre buhari era.

Pistotita:
I don't know why people aren't happy with this action of Mr. President. To me, it's a good move. If he doesn't do this, we will keep importing everything. At least, we need to move to producing over 80% of the food we consume. He is not saying he is banning it, but just not making it attractive so it can force us to go into local production.

Every fair minded (unbiased) person should see reasons as per above. How do we encourage our local produce patronage if such is not done. Secondly he is saving the scarce foreign currency we have to use it on needed area/items that we do not have. Haba let's for once accept this poor man's policy.

fortran12:

I mentioned earlier that one one of the reasons is the land and labor

That is actually two reasons, land and expensive labour. But that's not y d UK imports food. This is d reason y d UK imports food:

"Farmers represent an ageing population, partly due to low earnings and barriers to entry, and it is increasingly hard to recruit young people into farming. The average farm holder is 60 years old."

Source: Agriculture in d UK-Wikipedia

Abuloma80:


Every fair minded (unbiased) person should see reasons as per above. How do we encourage our local produce patronage if such is not done. Secondly he is saving the scarce foreign currency we have to use it on needed area/items that we do not have. Haba let's for once accept this poor man's policy.

When d govt wants to implement certain policies, they make it sound like they are doing us a favour. Unfortunately, some citizens latch unto their swan song& are quickly won over without bothering to find out if d president actually practices what he preaches.

When this govt came in 2015, they came with d "change begins with me" mantra and campaigned that Nigerians should stop patronizing foreign made produce so that as u said "save the scarce foreign currency we have to use it on needed area/items that we do not have". But this is d same buhari who flies 2d UK just 4 ear treatment. This is d same man who spent more than a 100days at a stretch in d UK on medical care. His kids schooled there, and more or less live there. In all these, was it local currency that was used?

lexy2014:


That is actually two reasons, land and expensive labour. But that's not y d UK imports food. This is d reason y d UK imports food:

"Farmers represent an ageing population, partly due to low earnings and barriers to entry, and it is increasingly hard to recruit young people into farming. The average farm holder is 60 years old."

Source: Agriculture in d UK-Wikipedia

It still points to expensive labor

fortran12:

It still points to expensive labor

It doesn't point to "expensive labour" cos nothing in that excerpt indicates labour being expensive.

Kfed4ril:


It’s oly a foooool that will tell you that buhari has achieved anything in the fight against insurgency.

Boko Haram still controls same if [b]not more landmass [/b]as at pre buhari era.

they control more ...and also kill more soldiers on daily basis...

francisbarrack:



let me pay 25k

Oya!

You people are so stewpid. You say Buhari caused the poor economic state of this country yet Buhari closed border against all sorts of balderdash entering this porous country, Instead of supporting him, no, you still condemning his actions. You are all morons.

Which country can survive with country like Niger Republic as neighbour? Your hatred for Buhari might just send you to an early lodgement in the psychiatric ward. Bunch of useless hate-filled unreasonable youths.