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Imported rice: Nigeria loses N80bn to neighbouring countries

By on April 5, 2014

Nigeria has lost over N80bn worth of rice cargo to the neighbouring countries in the last three months, due to the imposition of 110 per cent import duty on the commodity by the Federal Government.

The Seaport Terminal Operators Association of Nigeria gave the figure, explaining the country in the first quarter of the year lost about 600,000 metric tonnes of rice through cargo diversion to the neighbouring countries.

STOAN said the loss was due to the continuous diversion of shiploads of rice to the ports of Benin Republic, Cameroon, Ghana and Togo.

The Chairman of STOAN, Mrs. Vicky Haastrup, who disclosed this, in a statement obtained on Thursday, said about 150 shiploads of rice had been diverted to the ports of those neighbouring countries between January and March.

The 110 per cent import duty on rise was introduced in early 2013.

She said, “Our economy is bleeding seriously because of this policy. The loss to other countries, as a result of the high tariff on rice was over N300bn last year; while in the first quarter of this year alone, both government and private operators have lost at least N80bn.

“Even the Federal Government through Minister of Finance, Mrs. Ngozi Okonjo-Iweala, has admitted the shortcoming of this policy. The truth is that the policy has done more harm than good to our economy and government should waste no further time before reversing it.”

Haastrup said revenues affected by the 110 per cent rice policy included those of the Nigeria Customs Service, terminal operators, dockworkers and the Nigerian Ports Authority, adding that the Customs should not be blamed for the high rate of rice smuggling into the country.

Haastrup said, “It is totally wrong to blame the Customs. The Customs is doing its best under the circumstances to check smuggling of rice into the country and that can be seen from the numerous seizures they make every day. The fact of the matter is that the policy cannot work. Even if you place heavily armed Customs officers in every corner of our borders, it won’t stop smuggling.

“It is a fact that local production cannot match local demand which creates the attraction for smuggling. There is a lot of pressure on the Customs because the quantity of rice manufactured locally can only satisfy 30 per cent of the local demand.”

She explained that the neighbouring countries were profiting from the rice policy by dropping their own tariffs on rice, adding “because they are benefitting, they give tacit support to these smugglers.”

According to her, the 110 per cent policy will not encourage local production but rather stifle it due to the high rate of smuggling.

 

 

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