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CBN Explains Why it is Banning Foreign Milk, Other Diary Products

The Central Bank of Nigeria (CBN) has said it will place a ban on the importation of milk and other dairy products into the country.

The CBN Governor, Godwin Emefiele made this known while addressing reporters at the end of the bi-monthly Monetary Policy Committee (MPC) meeting in Abuja on Tuesday.

Emefiele said that between $1.2 billion and $1.5 billion are spent yearly to import milk into the country.

He said “We can no longer continue to spend close to $1.2 billion to $1.5 billion, importing milk into the country, a product we can produce. To some extent, they (milk importers) should help us also to reduce the rate of herders, farmers conflict”.

The apex bank also said it will start the rejuvenation of moribund textile mills in the country.

The Director in charge of Development Finance Department in Central Bank of Nigeria (CBN), Mrs Bademosi Tinuola, made the promise at the official commissioning of a garment company, “Xirea Apparels” by Buphalo company in Port Harcourt, the Rivers state capital, yesterday.

she said “The present administration and the Governor of Central Bank are in support of local manufacturers. We believe in growing the economy of the country; we don’t want our country to become a dumping ground for all kinds of imported goods. Most of our industries are collapsing now because of indiscipline”
“We are presently growing cotton in the north. By October we will start to harvest our cotton to encourage textile industries. CBN imported the seeds and planted them so that we can revamp dead textile industries.
“With this very soon, the textile factory workers will go back to work, fabric staff, engineering workers will be up and working and employment rate will be higher, crime and criminality reduced and Nigeria economy will begin to work again”.
At the end of the meeting, MPC members voted to: Retain the MPR at 13.50 per cent; Retain the asymmetric corridor of +200/-500 basis points around the MPR; Retain the CRR at 22.5 per cent; and retain the Liquidity Ratio at 30 per cent.
Speaking, Emefiele said CBN has held several meeting with milk importers, the first being about three years ago, after the introduction of forex restrictions on over 40 items.
He said “About three and half years ago, when the policy on restriction of forex started, we considered including milk on the list of items under restriction from forex, but we conjectured that based on sentiment some people are bound to express, that we should be very careful.
”We called on the management of the oldest milk importer into Nigeria, WAMCO into Central Bank office in Lagos.
”We held at least three meetings with them and we told them this would have happened but we decided not to allow it to happen, that we are trying to use the opportunity to appeal to them to do backward integration. ‘Integrate backward and begin the process of development and produce your milk in Nigeria”.
”Importers could also support the pastoralists, get them concentrated in one place instead of moving around. Provide them facilities like water, hospitals, schools.
”If you are in a community and you want to enjoy the proceeds of that community there is nothing wrong in providing certain things for the communities to blossom.
”The proceeds of what you get in return will be your milk to recoup your investments.
”Those are the kind of things we expect companies that are importing milk into Nigeria to do. Unfortunately, after three years, nothing has happened.”
”If the journey was started three years ago, perhaps the herders, farmers conflict that we see today would not have been as intense as it is this time.
” We would need your help at this time because we can no longer wait for you to continue to be importing this product into Nigeria because we are convinced it can be produced in Nigeria.
”The farmers can acquire land and begin to graze their own cows and fatten them and get the milk, and then they can also be complemented by pastoralists who own their own small holder cows under a small farming holder arrangement, they can also get milk from them”.
However, the milk importers ignored Emefiele’s advice which has now led to the forex restrictions on milk importation.
According to Emefiele, “Nigeria belongs to us, when we have policy, we want people to respect the policy of this country.
”The amount we spend importing milk is too high. We are saying, by doing backward integration, help us to reduce or limit herders and farmers conflict in Nigeria and we are determined to make milk production in Nigeria a viable economic proposition.
“By the time we restrict you, if you need loan to acquire land we will give you, if you need loan to grow your grass, we will give you; to produce water, we will give you loan.
”But that you will continue to import milk into the country, I think we are getting to the end of road.
”I will repeat, we are really getting to end of the road. The era of releasing forex for importation is coming to an end, and it will come soon than expected.”

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