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NIGERIA- The Cocoa Processors Association of Nigeria (COPAN) has called on the National Agency for Food and Drug Administration and Control (NAFDAC) to review the proposed 2024 Export Regulation Bill, which it argues would negatively affect the cocoa sector through increased costs and overlapping or regulatory roles.
COPAN highlighted sections 3,4,17 and 18, arguing their implementation would negatively affect local manufacturers processing cocoa beans for both the local and international market. The highlighted sections deal with the registration and licensing certificate issuance for exports.
The Association pointed out the implementation of section 17, which essentially describes the legal framework for issuing export certificates, would lead to a duplication of responsibilities.
COPAN said in a statement, “No business person can export any commodity out of Nigeria without obtaining an export certificate or license. NAFDAC taking up this responsibility is a duplication of duty.”
The Association also faulted section 18 of the Bill, which grants NAFDAC the jurisdiction to seal off any processing facility operating without a lawful order. It describes the section as draconian, potentially being used by staff to harass local processors.
They also faulted NAFDAC’s inadequate infrastructure and resources for effectively implementing the bill.
According to COPAN, the Bill will exacerbate and already dire situation in Nigeria’s cocoa sector, affected by a myriad of local and international factors.
Last week, COPAN revealed only 5 out of 15 cocoa processing facilities are currently operational in Nigeria, with operation capacity currently at 8%. The 10 cocoa processing plants closed because of security issues, high energy costs, deterioration of the Nigerian currency and high taxation.
The Association implored the government to implement favorable policies and review the proposed Bill to enhance cocoa production in Nigeria at a time when high demand caused by supply issues currently exists.
Production shortages in Ghana and Ivory Coast have caused a significant increase in price and demand for cocoa beans, with prices peaking at an all-time high of US$12,260 per ton in April.
In June, Nigeria’s national Bureau of Statistics (NBS) reported cocoa exports had increased by 276% in Q1 2024. However, the devalued naira inhibited significant benefit trickling down to farmers. Favorable policies that enhance production and reduce costs would help enhance Nigeria’s competitiveness in the international cocoa market.
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