• Tuesday, April 23, 2024
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Nigeria lifts FX restrictions on milk, dairy products importation

Firm ups milk production to save forex

The Central Bank of Nigeria (CBN) has lifted restrictions on the importation of milk and dairy products as seen in a recent circular, Ref number ted/fem/pub/fpc/001/010, dated March 12, 2024, sent to banks.

In February 2020, the CBN restricted foreign exchange allocation for milk importation exclusively to six designated companies within Nigeria.

The companies included Nestle, FrieslandCampina WAPCO Nigeria, Chi Limited, TG Arla Dairy Product Limited, Promasidor Nigeria, Nestle Nigeria, and Integrated Dairies Limited. The CBN noted that the initiative aimed to stimulate domestic milk production.

The new circular provides an update on eligible items for foreign exchange (FX), stating that the previous restriction on FX for the importation of dairy products and its derivatives has been lifted for all entities, except selected companies.

This decision marks a pivotal shift in Nigeria’s trade policy, allowing any entity that meets the necessary extant regulation requirements to source for FX at the Nigerian Autonomous Foreign Exchange Market (NAFEM) for transactions related to milk and dairy products.

The lifting of these restrictions is expected to have significant implications for the dairy industry, potentially leading to increased competition, improved availability of dairy products, and enhanced market access for a broader range of businesses.

Nigeria spends about 1.5 billion dollars importing dairy products annually, report by the CBN indicated.

On October 12, the apex bank restored the 43 items prohibited from access to FX, eight years after.

Here’s what the circular says

LIFTING OF RESTRICTION ON MILK AND DAIRY PRODUCTS IMPORTATION

“Please be informed that the Central Bank of Nigeria, through its circular, Ref no ted/fem/pub/fpc/001/010 dated March 12, 2024 has provided an update on eligible items for foreign exchange (non-valid for FX).

In light of the foregoing, please note that the restriction of FX for the importation of dairy products and its derivatives, to all entities except selected companies has been lifted.

Also note that any entity that meets the necessary extant regulation requirements is allowed to source for FX at the NAFEM for transactions.”