…Seeks support for local industries
COMFORT EKELEME, Asst Business Editor
Amidst mixed reactions which have continued to trail the proposed forex restriction on the importation of milk into the country, analysts still hold the strong belief that the policy, if enforced will go along a way to boost the growth of local industries.
Former President, Association of National Accountants of Nigeria (ANAN) Dr. Samuel Nzekwe said that the restriction of forex to milk importation will help reduce the unemployment rate and further make the market competitive both locally and at the international market.
According to him, there is need to enhance the capacity of local industries to ensure that Nigerians have enough to consume, adding that the country has all it takes to grow the economy and not be an import dependent nation.
Speaking with Daily Champion, Nzekwe maintained that the federal government’s plan of reducing the rate of unemployment in the country cannot be actualize if local industries are not empowered to employ more youths.
Meanwhile the Central Bank of Nigeria (CBN) explained that the planned policy is aimed at promoting the local production of milk in Nigeria.
The regulator in a statement signed by the Director, Corporate Communications, Isaac Okorafor said, “The attention of CBN has been drawn to attempts by some interests, who feel hurt by the planned policy aimed at promoting the local production of milk in Nigeria, to mislead the general public by misrepresenting the ordinarily unassailable case for investments in local milk production and the medium to long-term benefits of the planned policy.
Okorafor who Clarified the position on the proposed policy on FX restriction to importers of milk said, the attention of the CBN has been drawn to attempts by some interests, who feel hurt by the planned policy aimed at promoting the local \production of milk in Nigeria, to mislead the general public by misrepresenting the ordinarily unassailable case for investments in local milk production and the medium to long-term benefits of the planned policy.
He said, “While we are aware that some of our policies may hurt some business interests, we are thankful to Nigerians for the buy-in and intense interest in the policies of the CBN.
“As a people-oriented institution, however, we shall remain focused on the overarching and ultimate welfare of the Nigerian masses. We therefore wish to, once again reiterate our policy case as it relates to the planned restriction of access to the Nigerian Foreign Exchange market by importers of milk: Nigeria and the welfare of all Nigerians come first in all our policy considerations.
“Being an apolitical organization, we do not wish to be dragged into politics. Our focus remains ensuring forex savings, job creation and investments in the local production of milk.
“For over 60 years, Nigerian children and indeed adults have been made to be heavily dependent on milk imports. The national food security implications of this can easily be imagined, particularly, when it is technically and commercially possible to breed the cows that produce milk in Nigeria.
“About three years ago, we began a policy to encourage backward integration to conserve foreign exchange and create jobs for our people. Included in this policy package was the inform the Nigerian foreign exchange market for the importation of some 43 items goods that could be produced in Nigeria,” he said.
Speaking further, the director said, “Arising from the success of the restriction policy, we approached some milk importers, like we did for rice, tomato and starch and asked them to take advantage of CBN’s low-interest loans to begin local milk production instead of relying endlessly on milk imports.
“Today, although there have been some successful attempts at producing milk locally, the vast majority of the importers still treat this national aspiration with imperial contempt. For the avoidance of doubt, Milk importation is not banned. Indeed, the CBN has no such power. All we will do is to restrict sale of forex for the importation of milk from the Nigerian foreign exchange market.
“We wish to reiterate that we remain ready and able to provide the needed finance to enable investors who genuinely want to engage in milk production.
The ongoing resort to blackmail and undue politicization through the use of social media attacks can only serve to strengthen our resolve to wean our country from the clutches of powerful and highly influential traders and dealers who have kept the masses of our people hostage to foreign consumption and condemned our youths to perpetual unemployment.
“We call on Nigerians to enlist in this vanguard to take our economy back from vested interests, make our country a productive economy and create jobs for our teeming youths,” Okorafor maintained.
Agreeing with the CBN, Dr. Samuel Nekwe said there is no need for Nigeria to continue importing what can be produced locally, adding that there is need to save forex for other things.
He said, “As far as I am concerned whatever we are producing in Nigeria there shouldn’t be any forex or even allowing import of such product into the country. Because if you allow the import of such product, our industries will not grow, but government must make sure that the companies we have in Nigeria are producing enough for local consumption.
“If we have companies producing it and producing enough for us, that’s ok. So there is no need to give foreign exchange to that. So we should need to save the foreign exchange for other things, and allow the local companies to produce, allow the companies to be competitive in both local and international market. One of the problems of the economy is because virtually all the things we consume are imported. If we are producing as much as w are consuming, we will have enough foreign exchange to do other important things that would help grow the economy
According to him, “If we restrict importation, companies will expand and take in more people. Apart from taking in more people, we have enough local products coming out for consumption. We can also export to other African countries.
But the Manufactures Association of Nigeria (MAN) and the Lagos Chamber of Commerce and Industry (LCCI) had upon hearing the announcement, kicked against the plan to add milk to the list of items banned from accessing the official foreign exchange market.
Director-General of MAN, Segun Ajayi-Kadir noted that the addition of milk to restricted items would have a negative impact on the economy that might lead to downsizing, reduce government revenues and manufacturing sector’s contribution to Gross Domestic Product (GDP).
He lamented that CBN’s decision was taken unilaterally without consultation with operators in the dairy industry.
In his words, “It is a fact that to backward integrate is the way to grow an economy, but there is a need to be strategic and deliberate about the way to implement the measure.
“MAN has always been at the forefront of resource-based industrialisation; and has always supported backward integration, that is the reason why many manufacturers are exploring local sourcing of raw materials.
“What CBN wants to achieve is almost the same but the style of approach differs and the timing,” he said.
He warned that the policy would have negative effects from its desired purpose and would trigger more smuggling activities into the country.
Also, African farmer Mogaji, Chairman, Agric Sectoral Group, LCCI, expressed concerns about the apex bank’s use of monetary policies to address fiscal issues.
To him, the timing was wrong for the implementation of the policy as the country currently lacks the structure, infrastructure and capacity to effectively bridge the gaps that would arise from the restriction.
He urged government to strengthen the capacity of manufacturers by boosting their competitiveness through infrastructural development, investment in existing dairy sector and sustainable cooperatives model to build the agric sector.
But CBN had reiterated its readiness and ability to provide the needed finance to enable investors who genuinely want to engage in milk production.
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