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Forex ban for food imports

President Muhammadu Buhari

President Muhammadu Buhari disclosed during the Eid el-Kabir holidays in Daura that he had directed the Central Bank of Nigeria (CBN) to deny food importers access to official foreign exchange. The president hinged this measure on what he termed ‘steady improvement in agricultural production,’ and ‘attainment of full food security’ in Nigeria.

Buhari said “We have achieved food security. Don’t give a cent to anybody to import food into the country. Some states like Kebbi, Ogun, Lagos, Jigawa, Ebonyi and Kano have already taken advantage of Federal Government’s policy on agriculture with huge returns in rice farming…”

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This populist statement is in consonance with the president’s disposition since his first term in office in 2015. In the last few years, government has banned food importers from accessing foreign exchange from CBN, especially those who wanted to import items like rice, margarine, palm kernel/palm oil products, and vegetable oil. Other items affected by the restriction include meat and processed meat products, poultry chicken, eggs, turkey, tinned fish in sauce, tomatoes, among 41 items. Therefore, it is not clear if last week’s directive was a new measure or a reiteration of the existing policy. Government needs to, as soon as possible, get down to the nitty-gritty of the president’s statement.

We support the president’s desire for Nigeria to feed itself instead of depending on food imports from other countries, a practice that drains the country’s foreign reserves. However, there is need to accompany the impression that the country has attained food security with credible and verifiable statistical data. This is because the spate of insecurity in the North-West and North-Central, regions that constitute the food baskets of Nigeria, has made farming almost impossible. Many farmers have been sacked from their farmlands by bandits. They are holed up at Internally Displaced Persons (IDPs) camps. The crisis has reflected on food inflation rate, which has been very high since late last year. As at July this year, it was 13.39 per cent, according to statistics generated from the National Bureau of Statistics’ website. Food surplus (or security) should have brought down food inflation to, say, one digit. But it is not so in the country.

To effectively achieve food security, government should implement several strategies. Among them is the need to support local farmers with better farming implements that would enable them to produce more food with less physical strength. They need further support for better packaging, preservation and storage of their produce so that they do not sell them off at give-away prices during harvest seasons. A corollary to this is an effective quality control mechanism. Many Nigerians opt for foreign food items because agencies of government who should monitor and ensure quality of locally-produced good do not do their jobs.

We encourage government to critically evaluate the state of food security in Nigeria before taking drastic measures that could boomerang. There is nothing wrong with implementing the policy in phases, depending on grounds covered so far. For instance, in spite of the boom in rice production, there have been reports of rice smuggling into Nigeria. Because the prices of rice smuggled in competes favourably with locally-produced rice, Nigerians pay high prices for the rice they consume. Therefore, the forex restriction should be carefully weighed against possible consequences of its implementation so that it does not lead to higher cost of food items.

OVER 5,000 NIGERIAN MEN HAVE OVERCOME POOR BEDROOM PERFORMANCE SYNDROME DUE TO THIS BRILLIANT DISCOVERY

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