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Cocoa exporters reject new levy

By on July 26, 2014

The Cocoa Association of Nigeria, Cross River State branch, has expressed its resolve not to pay the N5,000 per tonne levy on cocoa exportation imposed by the state government.

Our correspondent learnt on Thursday that a meeting conveyed to resolve the lingering issue of export tariff on cocoa between the association and the state Commissioner for Agriculture, Mr. James Aniyom, ended in a deadlock on Tuesday evening with members of the association maintaining their stance.

Cocoa exporters in parts of the state, including Ikom, had last week suspended shipments after a dispute with the government over the imposition of the levy.

The exporters demanded that the state government should end the N5,000 levy per metric tonne charged for the shipment of the product.

The National Publicity Secretary of the association, Mr. Godwin Ukwu, said the stakeholders’ meeting offered an opportunity to discuss and agree on the issue but it was unresolved.

“They have suspended the collection and we moved the meeting to July 31 to decide on the way forward but the association is standing on its ground that we can no longer pay that much again since the court has declared it illegal. They asked us to pay the levy until February but we refused,” he said.

Ukwu said the association would meet with its members and farmers and come up with a resolution but that they did not intend to pay the levy anymore.

He said the exporters had resumed loading and shipments after the state government suspended the export levy.

Shipments were said to have been suspended with a reported 500 tonnes of cocoa stuck in warehouses, following protests against the failure of the state to obey a court ruling to revoke the tariff.

The association said the levy was introduced in 2011 and exporters had gone to court to challenge the tariff, which they noted as the highest among cocoa producing states in the country.

The Cross River State, according to the association, is the only state that pays N5,000 as export levy on cocoa, while other states pay between N3,000 and N3,500.

“It ought to be a uniform levy but each state has to consider its peculiar situation. In the case of Ondo, there was a lot of negotiation between the government and the private sector and the decision was that it should be N3,500 per tonne,” the spokesperson for the association, Mr. Robo Adhuze, said.

Cross River State is said to produce between 60,000 and 75,000 tonnes of cocoa annually, making it the second largest producer after Ondo State.

Ukwu, who spoke with our correspondent on the telephone, however, said the association would continue to export the product despite the dispute.

He said, “We are not halting exportation, except they come up again with the levy by the end of the month. That is when we will halt the movement of cocoa from the state. Nobody is paying to export from the last time we had a meeting on the 11th of July,” he said.

According to him, the state government is imposing the levy to make up for the short fall in oil revenue.

“Cross River State government said oil had been taken away from the state and they are looking for revenue but we are telling them that they cannot sacrifice the cocoa business for oil in the state. If they want to get revenue, they should encourage the farmers because if they continue with the levies and taxes they will drive them away,” he stated.

Meanwhile, Adhuze stated that despite the tariff problem, the country was on course to make its target of N104bn on cocoa export at the end of the season.

The association had said earlier in the year said that the rise in the price of the commodity last year resulted in the planting of more disease-resistant beans that would give more yields later this year.

He stated that farmers were also adhering to better practices that would increase harvest.

“Right now, we do not have too much rainfall to disturb the crop, although it is high in a few places, it is not too much; and farmers are using fungicides so the cocoa beans coming out are excellent because of the adherence to good agricultural practice. The N104bn exports earning is still achievable,” he said.

 

[Punch]