NIGERIA – The Central Bank of Nigeria (CBN) has clarified its proposed policy with regards to milk importation, maintaining that it does not intend to impose a ban on milk importation.
The bank noted that the new policy seeks to restrict the sale of foreign exchange to milk importers with an aim of stimulating investments in local milk production.
The CBN Governor, Godwin Emefiele and dairy producers have been engaging in deliberations to address challenges in dairy industry.
As part of its interventions, the apex bank in collaboration with the operators sought to explore the backward integration model in the sector as well as investments in ranches.
“About three years ago, we began a policy to encourage backward integration to conserve foreign exchange and create jobs for our people.
“Included in this policy package was the introduction of the highly successful policy which restricted sale of forex from the Nigerian foreign exchange market for the importation of some 43 items goods that could be produced in Nigeria.”
“Arising from the success of the restriction policy, we approached some milk importers, like we did for rice, tomato and starch and asked them to take advantage of CBN’s low-interest loans to begin local milk production instead of relying endlessly on milk imports.
“We wish to reiterate that we remain ready and able to provide the needed finance to enable investors who genuinely want to engage in milk production,” CBN said in a statement.
Operators in the sector however urged the CBN to maintain the current 5% import duty on milk raw material adding that access to foreign exchange should be made available to all dairy companies who have implemented backward integration with proof of on-ground facilities, milk collection and usage.
Meanwhile, the Federal Government of Nigeria has unveiled that it is in the process of establishing a National Dairy Policy that will help in boosting milk production as well as develop other dairy products.
Against the estimated annual milk demand of about 1,300m metric tonnes, Nigeria local dairy production currently stands at 700,000 metric tonnes, leaving a supply gap of 600,000 metric tonnes.
According to the former Minister of Agriculture and Urban Development, Audu Ogbe, Nigeria imports US$1.2bn worth of milk every year.