The governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, recently stated that the apex bank would restrict access to forex for milk importers, and this has not gone down well with many. However, the question on the lips of informed Nigerians is whether or not the step will address the issue of local production of milk; BENJAMIN UMUTEME writes.
With a forex of between $1.2 and $1.5 billion annually spent on milk importation it has become obvious that Nigeria cannot continue on the same path.
Fielding questions from journalists after the bi-monthly monetary policy committee meeting, the CBN governor said the apex bank has decided to restrict foreign exchange to importers of milk.
According to him, the huge amount of forex the country continues to spend on importation of the product was becoming unsustainable. He said the moves became necessary due to the huge forex spent yearly on milk importation.
To control the trend, Emefiele said the apex bank was ready to provide loan facilities for backward integration and milk production in the country.
He said, “We can no longer continue to spend $1.2 to $1.5 billion importing milk into the country, an item that we can produce in Nigeria today. And you must have heard me in different forums ask questions that we have seen the importation of milk into Nigeria before many of us were born, precisely over 60 years.
“Today, the importation of milk portfolio annually stands between $1.2 and $15 billion; that is a very high import into the country – given that we are convinced that it’s a product we can produce in the country. But let’s ask ourselves some questions; what does it really take to produce milk?
“About three and a half years ago, when the policy on the restriction of foreign exchange started, we considered including milk in list of items that should be restricted from forex.”
He said the CBN had a meeting with oldest producers of milk in to the country. “We had meetings with them and agreed for backward integration and begin the process of development and growing development of producing milk in Nigeria.
“Three and the half years ago, when the policy on the restriction of FX started, we considered including milk on the list of items that should be restricted from forex, but we conjectured based on the kind of sentiments that people will show that we should be very careful.
“We called in the management of the oldest milk importers in Lagos; we held at least three meetings with them. We told them what was to happen and what we decided, and we were trying to appeal to them to integrate backward and begin a process of developing and producing milk in Nigeria.
“Also, to some extent, they should help us reduce the rate of herder-farmer conflict, perhaps by now; the conflicts we are witnessing today won’t be as intense as it is at this time.
“By doing backward integration, it helps to reduce the rate of herders-farmers conflict and we are determined to make milk production in Nigeria a viable economic proposition and we would need to support them.”
“We can no longer wait for you to be importing this product into Nigeria. If we restrict FX, anyone who needs a loan for the process will get it from the bank. But, if it is to import milk into the country, I think we are getting to the end of the road and that is what we have discussed, and the era of restriction of FX for the importation of milk is really coming very soon.
“If they will not change their policy, we will not change our policy. We want people to produce milk in Nigeria.”
Ezekwesili’s take
A for former Minister of Education, Oby Ezekwesili, in a reaction, said the planned policy to restrict foreign exchange to milk importers as a way to boost local production “is vindictive.”
Ezekwesili, in a series of tweets from her official twitter handle, said, “Nothing more perverse of Political Leaders and Policy Makers as Policies borne out of Vindictiveness. It appears from what the CBN said on the #MilkBanPolicy that it is a case of: “You folks rejected RUGA, here is your punishment.” “What a BIG SHAME that would be,” she said.
“Often I read or hear Nigerians say: “We have good policies/laws. Our problem is lack of implementation.” How wrong they are! The bane of our failure to achieve sustained economic growth that reduced Poverty in other countries is actually, BAD…..dangerous Policies/Laws.”
“Milk consumption by Nigerians: 1.7 million milk production in Nigeria: 600,000 tonnes. When #MilkBanPolicy happens, to avoid scarcity which prices milk up and out of the reach of the Poor, Nigeria needs to immediately triple current production of milk.”
Towing Oby’s line, financial pkanning expert, Kalu Aja, a financial planning expert, said a ban on forex for milk imports will make milk to become more expensive locally.
“Most of the cows in Nigeria processed for beef are imported. Nigeria also imports raw hides, leather and fur skins. From 2014 to 2017, Nigeria spent N1.3 ttrillion on live animal imports.
“Banning imported milk is a policy known as import substitution. I support import substitution. Imported beef is banned in Nigeria, but live cattle imports are not. An equitable policy is to ban all imports of cattle dead or alive and cattle by-products. If milk is banned, will baby milk be also banned?
“Just like banning Rice, a ban on forex for milk imports will make milk become more expensive locally. As long as local supply cannot meet local demand, there will be imports. Nigeria has no cold chain thus a ban on milk means bulk of milk produced will be powdered,” he said.
In the same vein, economist, Tunji Andrews, said a FX ban will take away the last source of fortified nutrition from poor Nigerian children.
He said, “So, I’ll say it, so that it’ll be on record that it was said With Nigeria’s stunting rate at 43.6%, wasting at 10.8% and underweight children at 31.5%, the CBN’s plan to ban FX for milk importation is a bad idea. This could threaten our future, while we are concerned about now”.
“At the moment, Nigeria produces 600k tonnes of milk but consumes 1.7m tonnes annually. CBN governor is worried about the FX being used to fund the shortfall (rightly so) But what an FX ban will do, is take away the last source of fortified nutrition from poor Nigerian children.
“With the ban, N50 sachet milk will only experience what all other beverages in Nigeria experience to manage cost quality will reduce and be blessed with more sugar to improve taste Note that’s it’s not illegal to sell unfortified milk in Nigeria as it is elsewhere.
“What we risk is building an army of physically and mentally incapable adults who may become leaders like we don’t have enough problems Right now over 40% of children in Nigeria are stunted before you say the ban will force local build-up Let me ask you With which electricity?”
CBN clarifies position
Sensing the wrong interpretations of the policy, the apex bank last week clarified the earlier statement by its governor.
The bankers’ bank stated that it did not ban milk importation. However, what it tries to do by its new policy is to encourage people to invest in the production of milk locally.
“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 introduction of the highly successful policy which restricted sale of forex from the Nigerian foreign exchange market for the importation of some 43 items goods that could be produced in Nigeria. 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.”
Next Level: Time to set the ball rolling
By Abdullahi Sadiq Mohammed
In the build up to 2019 general elections, President Muhammadu Buhari (PMB) launched his re-election campaign manifesto where he boasted of laying a solid foundation to move Nigeria to the Next Level. The key areas in the policy document include jobs creation, infrastructural development, business and entrepreneurial development, human capital enhancement services and political inclusion. Nigerians have granted him another mandate and we are already in the next level of his administration. Beyond the campaign rhetoric, it is time to set the ball rolling and pull resources together to re-direct Nigeria on to the path of economic development and prosperity.
The president had contested four times under different platforms before finally succeeding in 2015. He defeated the erstwhile President Goodluck Jonathan to become the fourth democratically elected president in the current dispensation. He was the first to defeat an incumbent president in an election that was widely acclaimed to be free and fair. His victory was celebrated across the nation and supporters of PMB hold him in high esteem. He rode to power on the change mantra precipitated and nurtured by perceived ineptitude of GEJ and his government. The president is the second person after Obasanjo to rule the country twice: first as military head of state and as democrat.
Nigeria has done everything for Buhari and it is payback time. It is time Mr. President had a deep reflection and maximally utilise his last opportunity to serve his country as head of government. He was lucky to have power in the twilight of his life. Buhari has nothing to lose after being GOC, governor, minister, head of state and now president. The only thing that should occupy the president is to actualise his vision for which he had been contesting. He should have a mental picture of where he wants Nigeria to be as he leaves office in 2023 and mobilise all resources to bulldoze the country to the Promised Land.
John Maxwell in his book; The 21 Irrefutable Laws of Leadership, stated that victorious leaders possess an unwillingness to accept defeat. The alternative to winning is totally un acceptable to them. Ministers are the key players and drivers of vision of any government. It is the responsibility of the leader to ensure that they are united towards achieving a common goal of transforming the nation economically, technologically and infrastructurally. To achieve the Next Level agenda, the president and members of his inner circle have to work on unified blueprint in order to actualise his vision. There should be no mole or saboteur. Fortunately, the ground has been made perfect for APC to introduce sweeping reforms now that they have leadership of National Assembly.
Lee Kuan Yew, the founding father Singapore, led the country after its separation from Malaysia to become one of the world’s most financial hubs. Rwandan Paul Kagame transformed the post-genocide Rwanda to one of the fastest growing economies in Africa. According to World Economic Forum, Rwandan life expectancy, literacy, primary school enrolment and spending on health care have all improved. African leaders like Nelson Mandela of South Africa, Thomas Sankara of Burkina Faso as well as Kwame Nkrumah of Ghana have since left this world but their legacy leaves after them. These leaders were able to provide impactful leadership because of the passion, burning desire and sense of patriotism with which they serve their countries. I believe with similar determination and strong political will, our country could be turned around to be at par with its peers.
There are a number of life-changing projects inherited from the previous governments or initiated by the present administration that when completed has the capability to transform the economy of the country. The Railway Development Plan that was intended to cover a travelling distance of over 3421 KM. Lagos-Kano standard gauge railway project that would pass through Ibadan, Oyo, Abuja, Kaduna to reach Kano is being implemented in segments and at moment, only Abuja-Kaduna Segment has been completed while Lagos-Ibadan is still under construction. The government should start the Kano end of the project so that it connects Kano with Kaduna before the expiration of this administration.
Mambilla Power Station, one of the Africa’s largest dam projects was conceived in 1982, has the capacity to generate 3,050-MW when completed. About 37 years after, the project could not see the light of the day. Sometimes in 2017, Federal Ministry of Works and Housing announced the approval of contract for construction of Mambilla hydropower plant at cost of 5.972 billion. However, two weeks ago, I watched documentary on Mambilla Power Station where it was said that there was no even access road to the project not to talk of completing it. The Mambilla project is another opportunity for PMB to write his name in annals of Nigerian history by completing this monumental project.
The road to promise land is never straight but bumpy interjected with pot holes. There would be distraction and temptation to deviate from the target goal. It is my firm belief that PMB has prepared enough for his last battle to salvage this country in the Next Level for it’s the Last Level.
Mohammed writes from Kano
