Influx of foreign rice despite ban

Stakeholders in rice production have raised the alarm over the influx of smuggled foreign rice in Nigeria. Their concern was corroborated by Daily Trust investigation, published on January 25, 2021, which provided evidence that rice smuggling through the country’s porous borders in the North and South is common. From the report, it is apparent that […]

Stakeholders in rice production have raised the alarm over the influx of smuggled foreign rice in Nigeria. Their concern was corroborated by Daily Trust investigation, published on January 25, 2021, which provided evidence that rice smuggling through the country’s porous borders in the North and South is common. From the report, it is apparent that smuggling thrives because the borders are not effectively controlled by the Nigerian Customs Service.

While lamenting the negative impact of rice smuggling into the country, Mr Andy Ekwelem, the Director-General of Rice Processors Association of Nigeria (RIPAN), told Daily Trust that, “If the current situation is not immediately arrested, the tremendous progress made so far in the rice sub-sector would be washed away very swiftly. And, unfortunately, if that happens millions of jobs would be lost, huge investments would collapse, bank loans and other financial obligations may not be met, and there would be serious investor apathy because potential investors would find it difficult to trust the country’s business environment.”

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The argument advanced by the RIPAN boss is very apt. Over the years, as a result of the Buhari administration’s enthusiasm for rice production, the Central Bank of Nigeria (CBN) invested heavily in the sub-sector. The apex bank funded the multi-billion Naira Anchor Borrowers Programme (ABP) for farmers, the Paddy Aggregation Scheme (PAS) for processors, and even the Commercial Agricultural Credit Scheme (CAC) which provides funds for agro-investors at a single-digit interest rate. Based on these measures, government has beaten its chest that Nigeria is self-sufficient in rice production, if not food production in general. To assert this position, government prohibited rice importation. But foreign rice still flooded the country’s markets due, largely, to complacency and complicity of security personnel.

The first step in curtailing the influx is for the customs service to effectively carry out its assignment – policing the country’s borders. The customs constantly alleges that rice is smuggled into Nigeria through numerous points on our porous borders. If as a security outfit, the customs does not know where these porous border points are found, then that is unfortunate. We urge the customs to identify the illegal routes through which illegal foreign rice is brought into Nigeria and prevent smugglers from carrying out their nefarious activities that sabotage the country’s economy.  The primary duty of the customs is to prevent illegal goods from entering the country.

In dealing with the economic sabotage, it is important to ask why Nigerians prefer foreign rice to local rice. It is because foreign rice is better processed. If government is enthusiastic about curtailing the appetite  for foreign rice among Nigerians, it must invest in superior technology that would improve the quality of locally-processed rice. Perhaps, the CBN should consider a direct investment in high quality technology for rice processing either directly or through stakeholders.  In addition, we challenge Nigeria’s agricultural research institutes to come up with varieties of rice that could compete with those imported from Thailand, India, Pakistan and other countries.

Foreign rice is smuggled into Nigeria at a price that equates or is lower than the cost of locally-produced rice. This is possible because governments of countries from where rice is smuggled into Nigeria have put in place measures that encourage farmers to produce at a profit. First, these countries have irrigation facilities that enable farmers to harvest rice all year round. But in Nigeria, irrigation facilities have been abandoned, such that farmers depend absolutely on rainwater for rice production. This way, farmers cannot produce enough rice to meet the demands of a rapidly growing population in Nigeria, thereby creating the market for imported rice. It is time to rehabilitate the country’s irrigation facilities.

In addition to irrigation facilities, government should revive or create a marketing board where rice farmers could sell their produce at a profit to government. As it stands today, rice farmers are at the mercy of market forces, and in most cases, they cannot recover the cost of production if they sold their rice at the rate foreign rice is sold.  With the stiff competition from smuggled rice, many of them could quit rice farming.

We call on government to embark on measures to boost local rice production and to curtail smuggling.