BY VICTORIA ONU, ABUJA
Facts have emerged on why the Central Bank of Nigeria restricted the importation of sugar into the country to just three companies.
The CBN had, in a circular to all Authorised Dealers, directed that no other company should be provided foreign exchange from the foreign exchange market for sugar importation, except with the express permission of the bank.
This was contained in a circular signed by the Director of Trade and Exchange, Dr. Ozoemena Nnaji.
Following the development, some stakeholders had accused the apex bank of empowering a few big players who could fix prices, thereby affecting the common man.
But speaking in an interview, the Executive Secretary of the National Sugar Development Council, Zacch Adedeji, said that the decision of the apex bank was in line with the National Sugar Master Plan.
According to the NSMP, a total investment of $3.1bn (N1.17trn) will be needed from the private sector to effectively implement the sugar policy.
Adedeji said, based on the Backward Integration Programme, which the sugar masterplan was hinged upon, the three companies had committed huge investments into the plan by setting up refineries with a minimum refining capacity of 100,000 metric tons for each of them.
He said, “First, let me clarify that what the CBN has done is very much in tune with our Master Plan. At the beginning of the implementation of the Master Plan, there were conditions set for those wishing to participate in the BIP.
“One of the conditions is for them to have a verified plan to produce sugar, locally. The three companies you mentioned are those who have committed huge investments into the plan by setting up refineries with a minimum refining capacity of 100,000 metric tons for each of them and they have also keyed into the BIP.
“Sugar importation is based on quota, which is issued under the terms of our Master Plan to any company that can produce a minimum of 100,000 metric tons of sugar locally.”
“What CBN has done is to link our Master Plan progress to entitlement to forex at official rate. These three companies you mentioned have, in compliance with the Master Plan, been allowed some incentives and concessions to encourage their investments in local sugar production,” he noted.
He added that as a regulatory agency, the NSDC was charged with measuring and reporting on this progress to ensure that players in the sector continued to meet the conditions for those incentives.
He said, “We have reinvigorated that monitoring process to ensure that incentives are only granted to those that meet the conditions in terms of their attainment of the Master Plan objectives, especially with regard to backward integration.
“Progress must be measurable and we have communicated this clearly to all. At the NSDC, we actually want as many operators as possible to key into the scheme because this will enhance local production and create thousands of jobs.”
He explained that the target of the NSDC was to assist smaller players to get to the 100,000 MT target as quickly as possible.
“Competition spurs excellence and innovation. Ultimately, this is very good for the consumer by lowering prices and increasing choice. It is also good for the companies themselves,” he said.
“So, I expect the CBN to widen this list, as more operators key into the scheme. Don’t forget that local production is our primary focus,” the NSDC boss stated.
