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Nigeria Launches New Policy and Tariff Regime on Rice Imports

Federal Minister of Agriculture and Rural Development, Dr. Akinwumi Adesina

Honourable Minister of Agriculture and Rural Development, Dr. Akinwumi Adesina says Federal Government’s policy on rice, a core strategy under the Agricultural Transformation Agenda (ATA) has succeeded beyond all expectations and that the proposed tariff regime on the commodity is needed to protect local investors in rice, including farmers and millers, as well as creates jobs and wealth for Nigerians.

The Minister made the assertion recently during his presentation at the National Assembly public hearing on rice policy. Adesina posited that Nigeria had the capacity to become not only self-sufficient, but a net exporter of rice and that the Federal Government and forward looking stakeholders in the rice sector are determined to reduce the ridiculously high foreign exchange of over N365 billion being spent annually on rice import.

According to the Minister, it made no sense at all that Nigeria, with an arable land area of 84 million of arable land, is the second largest importer of rice in the world. The country, he said, definitely can grow rice and end the decades of dependence on rice imports from India and Thailand, as they don’t have anything that we do not have to produce rice. He said it is time we realized that the more Nigeria imported food items that can be grown locally, the less local production and the high level of unemployment and the worse our national insecurity.

That, Adesina said, is why President Goodluck Jonathan's government is driving a major import substitution drive on rice and other commodities under the Agricultural Transformation Agenda.

The Minister said Nigerians needed to frown upon the heavy flow of import of low quality and sometimes very unsafe foods, including rice and fish, wondering why some citizens are vigorously campaigning and taking sides with importers, wondering why we must import what we can produce, and a situation he called "prodigal economics".
  
The Minister said Nigeria is not an exemption in using high tariffs on rice. All over the world, rice is the most protected and subsidized of all commodities, with tariffs, tariff-rate quotas and tariff escalation for processing and value added. The US spends on average $1 billion per year in subsidy support, as well as high tariffs on rice imports. Analysts show that tariffs on rice imports and subsidies may account for 75% of incomes of farmers in rice producing countries. This leads to a depression of world price for rice, displacing local production and creating poverty for millions of rice farmers in rice importing countries.
  
According to the Minister, information being peddled by rice importers and rice processors that Nigeria is not producing enough paddy is wholesomely incorrect and mischievous.  Declaring that he had commissioned an independent USAID-Markets program and the Africa Rice Centre to verify the situation, which shows that there is sufficient paddy available, but the problem was accessibility by millers. While farmers complain of paddy glut, millers complain of lack of enough paddy. Accessibility was linked to high cost of paddy, long distances between production zones and location of mills, high transport cost from the production zones to the location of their mills, variable quality of paddy due to high moisture content or poor cleaning, lack of standardization of bags (farmers insist on selling in 75 kg bags instead of 100 kg bags or by weight), lack of storage facilities to stock up on paddy and limited financing to buy up the paddy rice., the minister disclosed.

To address the situation, Adesina said the Ministry of Agriculture swung into action and bought some of the paddy into strategic grain reserves. Some of the states also put in place guaranteed minimum prices and bought back paddy rice from their farmers. He said Nigeria must put in place guaranteed minimum price for rice and be ready for government to be buyer of last resort, to assure incentives for farmers, as is done in the rice exporting countries. Government, he said needs to make paddy affordable to our millers.

Source: Tony Ohaeri, Director Information and Protocol, Federal Ministry of Agriculture and Rural Development.

 

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