RICE: STAKEHOLDERS ALERT FG TO DANGERS OF ABNORMAL WAIVER
Stakeholders in the rice business in Nigeria, including farmers and processors, have alerted the Federal Government to the dangers inherent in a special duty waiver allegedly given to a private individual, who is alleged not to be a regular importer, to import 500,000 tonnes of rice into the country.
Investigation by our correspondent on Thursday revealed that an oil and gas firm (name withheld), got the waiver of no-duty payment to import the 500,000 tonnes of rice into the country. But the company, being a non-operator, has given the right to a commercial goods conglomerate, with interest in aviation, manufacturing and other sectors.
According to the stakeholders, the move poses a serious threat to the Federal Government's initiative on rice, which is aimed at supporting local farmers and processors of the commodity.
The President, Rice Importers, Millers, Distributors and Dealers Association of Nigeria Chief Mufutalo Gbadamosi, who presented the position of the stakeholders in Lagos on Wednesday, said that there was no justification for the granting of the special waiver, which was recently given to a non operator in the sector.
He said the country was not short of rive supply as the association's members recently brought in vessels. Besides, he said those members that brought in a vessel of rice recently paid the required duty fully, adding that 'there are more rice vessels on the high seas heading to Nigeria currently.
According to him, the decision to grant a single individual a duty waiver to import 500,000 tonnes of rice is a serious threat to the Rice Initiative put in place by the Federal Government.
He said, 'The threat is posed by a strong but selfish business interest, which has succeeded in obtaining the Federal Government's nod to flood the Nigerian market with imported rice.
But when our correspondent contacted the Director, Agro Processing, Ministry of Commerce and Industry, Moses Adewuyi on the telephone, he said there was nothing like that. He, however, admitted that there were subterranean moves, often to cut corner.
'But I tell you, such did not come through my office. Maybe through the Ministry of Finance.'
Many of such farmers had, at the onset of the global food crisis in 2006 and in response to the clarion call by the Federal Government, borrowed huge sums of money which they invested in rice cultivation.
'But with the latest policy summersault, especially the granting of a waiver to a single importer to ship more rice into the country (purportedly to cushion the effect of poverty), such facilities seem obviously trapped, leaving the local farmers, and in fact, the local economy in jeopardy,' Gbadamosi said.
Most rice stakeholders, who reacted to the development, condemned the decision to grant a duty waiver to a single person, stressing that it was bad enough, if such an action had been taken by the government without due consultation with stakeholders or without any regard for the concerns of local farmers.
They, therefore, urged the government to rescind the decision, saying that it would be a disservice to the sector in particular and the economy in general.
The Managing Director of Titres Enterprises, Isolo, Lagos, a major rice importing outfit, Mrs. Titi Olaoye said,`'What is worrisome is that most of our members took loans at high interest rates to import this commodity, which can no longer compete price-wise with the man that has been granted a waiver to flood the market with rice.
'I envisage a situation, where our members would not be able to sell, resulting in loan defaults running into billions of naira,'' he said.
She added that the decision was coming on the heels of the sector's recovery from a long period of neglect, following the Federal Government's initiative of establishing 17 rice mills across the country- a policy, he said, was gradually gaining ground. Another importer, Mr. Ken Agbogun, said that the government would lose over N2.8bn million though that single act.
He said, 'The revenue that is supposed to accrue to the government is about N1.3bn and any step towards granting of duty waiver will also portray the present administration as unserious and inconsistent. At the same time, it will send a wrong signal about the government to the outside world.''
Recalling fears of the past, he said importers granted waivers had often connived with security agencies to import far beyond the quantity stipulated. He also queried the rationale behind the granting of the waiver to an individual.
'Most of our members have invested massively in rice mills because of the doggedness and commitment of the former president, late Musa Yar'Adua to the policy.