One of the many tribulations of smallholder farmers, processors and investors in Nigeria is smuggling, as well as dumping of produce. It is destroying the Nigerian agro-economy.
For many years, poultry and rice farmers, processors and investors are the hardest hit. According to the Food and Agriculture Organisation (FAO) of the United Nations’ African Sustainable Livestock, 2050, “poultry production in Nigeria amounts up to 454 billion tonnes of meat and 3.8 million eggs per year, with a standing population of 180 million birds. About 80 million chickens are raised in extensive systems, 60 million in semi-intensive systems and the remaining 40 million in intensive systems.”
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The Central Bank of Nigeria (CBN) valued the country’s poultry industry at N1.6 trillion, which is more than 10 per cent of its total 2021 budget.
The apex bank estimated that over 1.2million metric tonnes of poultry meat consumed in Nigeria was smuggled through Benin Republic.
With such huge figure, before the border closure, Nigeria was said to be losing about N800billion as revenue every year to smuggling activities in the poultry industry. This figure is more than twice the total 2021 budget of the country’s agricultural sector of N280billion.
In terms of rice, before the closure of the borders, the country lost a large chunk of its revenue due to smuggling activities. For example, the country, in the first quarter of 2015 alone, lost at least N80billion in customs duties to smuggling.
For cotton farmers, smuggling of textile materials into the country has not only killed the industries but collapsed cotton farming across the country, throwing out millions of jobs in the CTG industry.
It is estimated that Nigeria loses an overwhelming $325million annually in customs revenues due to smuggling of textile materials, according to the Nigerian Textile Manufacturers Association (NTMA).
Since he was elected into power in 2015, President Muhammadu Buhari has made agriculture one of his cardinal points, bringing attention to the sector. That year, the Federal Government, through the CBN, banned forex for rice import and launched the Anchor Borrower’s Programme and set up at least N40billion to boost the productivity of smallholder farmers, beginning from Kebbi State. This is in addition to 70 per cent tariff coming through the country’s ports.
The border closure policy last year further boosted the confidence of many investors, processors and farmers as it cut down smuggling activities significantly. However, with the recent reopening of the borders, many stakeholders are worried that smugglers would come back and more advanced in strategy.
These may erode the self-sufficiency drive and gains made by smallholder farmers, processors and the billions sank into the sector by agencies such as the CBN, which is funding most of the crops.
The CBN, for example, is funding the Anchor Bowers’ Programme across rice, maize, soybeans, cotton, cassava, poultry and other value chain activities, which have seen increased production.
Many of these farmers would not be able to repay their loans if smuggling is allowed across the country’s borders; and poverty, which the Federal Government is fighting, will become more devastating.
On trade liberalisation, the Federal Fovernment must strive to protect its local farmers and the initiative of agencies of government like the NIRSAL, CBN and others.
The Centre for European Policy Studies (CEPS) highlighted concerns when it also comes to trade liberalisation, saying it may affect small scale farmers, particularly in developing countries, a position shared by the Nigerian Economic Summit Group (NESG) on their submission on the African Continental Free Trade Area (AFCTA).
“It is frequently pointed out that there is a downside to trade liberalisation in exposing vulnerable producers in developing countries to ‘unfair competition’ from multinational companies, which may tend to displace domestic production and in creating an uneven playing field between domestic products and cheap imports,” CEPS stated in one of its working documents.
Kabir Ibrahim, the national president of the All Farmers Association of Nigeria (AFAN), said due diligence and extreme care would be required to protect our porous borders.
“Corruption has always been responsible for the burning embers of smuggling. The Nigerian Custom Service is clearly reforming, but a lot more work has to be done to rid it of some bad eggs still in the system. As for the farmers, the AfCFTA is the reason we support border reopening as the market will afford us the opportunity to sell our produce at a fair rate. There are obvious controls that will make the whole programme succeed or fail. The firm control to stem out smuggling or dumping of unwholesome produce must be enacted forthwith,” he stressed.
According to him, smallholder farmers and processors need the help of government through functional institutions to remain afloat in the sector.
Many farmers who spoke with Daily Trust on Sunday want the Federal Government to tighten security and ensure 100 per cent compliance with the directive on rice import ban.
“The Federal Government must monitor the activities of border patrol teams because the problem has been compromise by security officials. This time they must be fished out and punished to serve as deterrent, otherwise, every effort of the government and its agencies will be a waste,” a rice farmer, James Audu said.
An agric-economist, Ahmed Ibrahim, said there must be a strong political will on the part of government to protect the country’s economy from porous borders, adding, “Even during the border closure, there were a lot of smuggling activities because some officials took bribe.”
He said efforts must be made to bring down cost of production so that local goods would be cheaper for consumers and discourage smuggling. He added that cheaper goods in neighbouring countries would encourage smugglers.
If the recent effort by the Federal Government and neighbouring countries by setting up a joint border patrol works, coupled with the presidential order to avoid giving forex for food importation, then Nigeria would be on course to attaining food security.