Nigeria must tackle smuggling to sustain agric growth, investments as borders reopen -Experts

With the recent re-opening of the Nigerian four land borders, experts in the agricultural sector have urged the government to tackle the issue of smuggling to sustain agric growth and investments.

They noted that the government was forced to shut down the land borders initially owing to the high rate of smuggling which was hurting agribusinesses in the country.

The experts fear that the high rate of smuggling might return soon as the country has reopened its borders if proper structures are not put in place to curtail it.

Fatai Afolabi, managing consultant, Foremost Development Services Limited welcomed the reopening of the land borders but stressed that poor structures to prevent smuggling by border authorities will allow economic saboteurs to take advantage.

“Now that the borders are reopened we need to ensure that the issue of smuggling is addressed effectively,” Afolabi said.

“Smuggling does not help smallholder farmers or create jobs. The government needs to show seriousness and commitment to tackle smuggling,” he said.

According to him, smuggled cheaper agricultural products have deterred the country’s dream of having a vibrant agric sector.

He noted that the difficult operating environment, high cost of production, and logistics have made the country’s agricultural produce unable to compete favourably with imported cheaper products from Asia and Russia.

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Similarly, Rotimi Oloye, president, Catfish and Allied Fish Farmers Association of Nigeria (CAFFAN), said that there will attendant flooding of the food market with cheaper and unhygienic products brought into the country owing to loose borders.

“It will hamper the recovery of investors in the agri-business as cheap products, enhanced by better-operating conditions in the country of such imports, flood the country,” Oloye said.

“There will surely be losses of investments and jobs with the collateral effects of uncontrolled trade across the borders,” Oloye said.

Nigeria, Africa’s biggest economy shut down its land border with neighbouring West African countries in August 2019 to tackle the smuggling of rice and other goods.

This was done to sustain and maintain the numerous Central Bank of Nigeria (CBN) initiatives such as the Anchor Borrowers Programme to grow the agricultural sector and protect investments in the sector.

Although, importation of agricultural products remains prohibited and technically hindered even with the reopening of the borders.

But the Nigeria Customs Service has been unable to effectively and efficiently man the borders due to the high rate of corruption and lack of surveillance equipment.

To ensure that smuggled food products are not smuggled into the country with the reopening of the land borders, Nigeria and neighbouring West African countries – Benin and Niger in December 2020 jointly set up a Joint Border Patrol force to tackle smuggling in the region.

If this is successful and coupled with the presidential order on forex restriction for food importation is effective, the country’s quest and investments to become food secure would remain on course, experts say.

“Nigeria’s quest for food security and job creation through the agricultural sector will be on course if the Joint Border Patrol initiative can tackle smuggling which has remained a big challenge to investments in the sector,” Musa Ibrahim, a rice farmer in Kano said.

“Since the reopening of the borders foreign rice is gradually returning to shelves of traders, so if we fail to tackle it now, various investments across the value chain will be threatened,” he said.

Nigeria’s rice farmers and millers who struggled in the past to sell their products were smiling to the banks as demand for the crop rose owing to the border closure policy and ABP.

It made farmers and millers ramp up their production to meet the ever-increasing demand for various agricultural products.

The country was able to increase its rice production to 4.78million tons annually owing to the ABP, data from United States Department for Agriculture (USDA – 2019) grain report shows.

Similarly, it spurred demand in crop and livestock products across the country and created investment opportunities for potential investors in the rice and poultry production value chain, among others.

But smuggling and discouragement of local production will hinder recouping of loans under the CBN intervention programmes if left unchecked.

The CBN has committed more than N200 billion to support over a million farmers under the ABP initiative and this has spur investments across the rice, palm oil, fish, and poultry value chains among others.