Charles Nwaoguji, [email protected]
One of the goals of Nigeria’s agricultural development policy is to ensure that the nation produces enough food to become less dependent on importation .
This will so make it affordable and ensure adequate nutrition for all. Recent studies show that there is a shortfall in domestically produced food in Nigeria because the growth in the population of Nigeria is at the rate of 3.2% while the growth in food production has been less than one. This shows that demand for food is greater than the supply because of factors such as inconsistent government policies, environmental degradation and non-sustainable agricultural production. It is also believe that Nigeria depends so much on food importation.
In the past three and half decades, food security has evolved to become a burning contemporary issue in view of the role it plays in transforming peoples livelihood, promoting good health and mitigating endemic poverty. In Nigeria, the state of food insecurity has attained a worrisome dimension, particularly, when weighed against the rapid increases in the country’s population; thus making Nigeria a food-deficit country with escalating food import bills. Various factors have been identified for the nation’s problem of relative food insecurity. These include governance crisis which manifest in various forms like poor implementation of economic policies, high cost of governance and corruption. Others include undercapitalization, dysfunctional institutions, and poor infrastructural facilities, amongst others
Nigeria is facing a lingering food crisis. Between 2008 and 2013, production of staple cereal foods (maize, millet, rice, sorghum, wheat, and other cereals) declined by 11.8% from about 28.8 million tons to about 25.4 million tons. Also, spice (pimento and other spices) and tomato production shrank by 1.7% and 14.1%, respectively over the same period (Fig. 1). An observed decline in food production vis-à-vis a projected 2.7% annual population growth in the country poses a serious food security challenge. A recent joint stakeholders’ report on the food insecurity situation in 16 states in Northern Nigeria indicated that over 3.7 million people are food insecure. Based on the report, a total of 3.5 million people are currently in food crisis while 999,959 are in an emergency situation in need of urgent assistance. This is more pervasive in the northeastern part of the country where a State (Borno) is said to account for over 50% of the burden. It is noteworthy that the actual food insecurity situation in Nigeria may be some percentage points higher than the one reported above given that the report did not capture the food security situation in the southern part of Nigeria.
The general decline in food supply partly reflects in the upward food price trajectory witnessed between January 2010 and January 2018.. Higher food prices without a corresponding increase in income would greatly impinge on food accessibility. This suggests that the existence of food insecurity is not peculiar to the northern states of Nigeria, but it is also present in the southern states. The loss of agricultural production due to Boko Haram’s activities is estimated at US$3.5 billion; the total economic impact of the insurgency has been put at US$9 billion. Compounding the food insecurity situation are the yet-to-be-resolved incessant clashes between herdsmen and farmers.
Despite all these challenges, President Muhammedu Buhari still went ahead to ban Forex for food importation which has attracted a lot of reaction from the stakeholders .
Those who spoke to Daily Sun, says the ban on the Forex restriction on food import is favourable to MSMEs.
The Nigerian Association of Small and Medium Enterprises (NASME) says, the Federal Government’s decision on foreign exchange restriction to food import is favourable to the association and manufacturers in the country.
The Chairman, Lagos State Chapter of NASME, Mr. Solomon Aderoju, noted that the policy statement will help in strengthening the country’s currency.
Aderoju pointed out that forex restriction will help conserve the Nigeria’s foreign earnings, adding that it will adversely enhance the already weakened Naira.
Commending the government for the giant stride, he said, this is the only way MSMEs would grow, adding that more jobs would be created if well implemented.
The Manufacturers Association of Nigeria (MAN), said it is yet to fully understand the import of President Muhammadu Buhari’s directive to the Central Bank of Nigeria, CBN, on restriction of foreign exchange to food importation into the country.
According to the Association President, Engr. Manuse , a close examination of the directive reveals that it is broad and would have to be both specific and targeted and there should also be strategic implementation to achieve the purpose intended by government.
He stated that in the case of input for process, there is need to know the local capacity available compared to national demand and if not adequate, creditably determine what time and resources are needed to ramp up capacity and production.
“It is pertinent to pre-determine these suggestions as part of the implementation strategy. To achieve sustainable self-sufficiency, local producers ought to be incentivized otherwise we may be inviting a looming barrage of smuggling activities.
“We are not necessarily worried about the directive and we prefer to see it as an expression of Mr. President’s mindset.
We are sure Mr President is aware of the independence of the CBN and that such policies may be counterproductive if implemented by fiat, without ensuring necessary alignment with the fiscal policy and other economic policy initiatives of this administration.
The necessary support that would sustain the “steady progress in agricultural production” and attainment of “full food security”, for instance, would have to be considered. On the matter at hand, what is needed is clarity.” he pointed out.
He said the Apex bank will have to do an assessment of where we are in practical terms and realistically weigh its options before embarking on such a far-reaching policy, adding, “There should also be a process to be followed before such a plan is unfolded. On an issue as critical as this, a unilateral decision could be counterproductive when the operators are not duly consulted. We must consider the state of our infrastructure and its capacity to respond and support the policy.”
While, the Association lauded the move, it called for clarity as we have to be deliberate and strategic in pursuing such a far-reaching monetary measure, especially in the light of our vulnerability occasioned by trade agreements that require the country to be more open to imports and the well-known antics of our neighboring countries.