• Sunday, July 21, 2024
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Nollywood boom hints at needless FG’s protectionist policies

Nigeria’s protectionist economic policies have the most unlikely detractor – the local film industry.
In three weeks, Nigerian movie “Living in Bondage” set a box office record of N103 million, the most of any other movie, local and foreign, in that period, according to data by Cinema Exhibitors Association of Nigeria.
That’s happened without the Federal Government forcing people to watch only local movies or prohibiting them from watching foreign movies.
The box office numbers of “Living in Bondage”, the sequel of a local movie first shot in the early 90s, beats that of the second-highest-grossing movie, Disney Studio’s “Maleficent”, despite taking twice as many weeks as “Living in Bondage”, six weeks, to hit N96 million.
In not-too-distant third is American science fiction “The Terminator: Dark Fate” which took four weeks to gross N78 million.
Previous records set by other Nigerian movies “King of Boys” and “The Wedding Party” show that the dominance of local movies over their foreign counterparts is no flash in the pan. It has been a consistent trend for over two years now. As the quality of local movies grew, so did appetite for them by Nigerians who are perhaps wrongly adjudged sometimes to be hooked on foreign items.
“Nigerians are not necessarily hooked on foreign items; instead they are hooked on quality and affordable items be it foreign or local and the movie industry is proof of this,” an entertainment lawyer at a Lagos-based law firm told BusinessDay.
“The government did not have to persuade anyone to watch the Wedding Party or Living in Bondage, yet they opted to watch them over foreign movies. That should serve as an example that protectionism is not the only way to go to boost local industries,” the person who could not immediately secure official permission to speak publicly said.

Protectionism refers to government actions and policies that restrain international trade, often done with the intent of protecting local businesses and jobs from foreign competition.

Typical methods of protectionism are tariffs and quotas on imports and subsidies or tax cuts granted to local businesses.

From an abrupt land border closure to restrictions on importation of some items, the Federal Government has been keen to protect local industries against foreign competition.

“Investors are confused over Nigeria’s border closure and are left wondering why the country is building a wall around itself when trade is key to economic development,” one foreign investor told BusinessDay.

Nigeria’s move also contradicts why it is a party to the ECOWAS Treaty and the Africa Continental Free Trade Agreement (AfCFTA).

As the reason for the border closure, the government said it was bothered about the smuggling of rice from neighbouring country, Benin Republic, which left local rice producers with rising inventories.

It, therefore, shut the borders altogether to stem the illegal importation of staple food that the government is determined to produce locally.

That may be unsustainable.

While rice production has grown over the last decade, local production volumes of 3.7 million metric tonnes, according to the US Department of Agriculture, can only meet around half of total demand of 7 million metric tonnes.

The high tariffs on the importation of rice have triggered a surge in smuggling, with the relatively higher price of local rice curbing demand. While foreign rice cost about N14,000 prior to the border closure, local rice was going for N18,000, no thanks to a gaping infrastructural deficit from power to transport that drives up the cost of local producers and renders them non-competitive.

Analysts say closing the infrastructural gap is key if the government is keen on helping the local industries thrive and compete, rather than an “unsustainable border closure”.