How outdated law restrains Nigeria’s export drive

Nigeria’s 34-year-old Export Prohibition Act is restricting the export of certain agricultural commodities amid acute dollar shortages rocking Africa’s biggest economy.

The existence of the Act is limiting lots of export activities and investments in the yam, cassava, beans, maize, and rice value chains and their derivatives despite being leading producers of some of these crops.

Simon Irtwange, professor of agriculture processing and storage at the Federal University of Agriculture, Makurdi, noted that the inability of the government to repeal the Export Prohibition Act of 1989 is hindering foreign investors and development partners from investing across the various value chains as they always want to comply with the country’s laws and regulations.

“We had an international NGO that wanted to support yam farmers in promoting the export of yam flour a few years ago, but they withdrew as soon as they learned of the 1989 Export Prohibition Act,” Irtwange, who is also the national president of Yam Association of Nigeria, said.

“We need to repeal the Act so that people who are aware of the existence of it can have a clear mind to do business and invest across these value chains involved,” he added.

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According to him, few Nigerians export derivatives of these commodities because the Nigerian Custom and Exercise Consolidation Act does not prohibit the importation of the list of items and their derivatives except for maize.

Nigeria is the largest producer of cassava with 63 million metric tons of cassava tubers in 2021, according to data from the Food and Agricultural Organization (FAO), which accounts for one-fifth of global production, a 2021 PwC report said.

For yam, the country is also the largest producer of the crop with 50.4 million metric tons in 2021, according to FAO. For beans, the country produced 3.7 million MT in 2021.

This production position puts Nigeria in a strong competitive advantage that can be tapped for an astounding economic impact, especially through value addition.

“The Act, while originally designed to ensure local consumption, now seems to be a bottleneck that hinders Nigeria’s capacity to tap into the immense global market,” said a source who doesn’t want to be quoted.

According to him, the Act is counterproductive to the country’s aspirations of economic growth and development.

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He stated that while there are concerns around food security, the proposed exports of these certain commodities are a mere fraction of post-harvest losses.

He called for the amendment of the Export Prohibition Act of 1989 to allow export of value-added products derived from yam, beans, and cassava, noting that it would be a monumental step towards diversifying the country’s revenue stream, reducing post-harvest losses and creating jobs.

“We have the resources, potential and technology. What we need is a legislative framework that aligns with contemporary economic realities and aspirations,” he said.

The bill to repeal the Export Prohibition Act was sent to the House of Representatives after a public hearing, awaiting concurrence by the 8th Senate to be transmitted to the President for accent in 2022. Nothing regarding the bill has happened since the inauguration of the 9th Senate.

Obiora Madu, chairman and CEO of Mulitimix Group, called on the government to first boost local production to ensure that the country has enough for consumption and export.

He noted that the country has failed to boost exports because of a shortfall in the production of most commodities and a lack of attention to value addition.