Central Bank of Nigeria Allay Fears Over Food Import Ban on AfCTA.
The recent policy decision of the Central Bank of Nigeria under the directive of President Muhammadu Buhari, to ban foreign exchange for importation of foreign foods has elicited series of reactions with analysts questioning the rationale behind such move, especially in the face of the recently signed Africa Continental Free Trade Agreement (AfCTA). The decision drew criticisms from analysts most of who expressed concerns over the overall impact of the policy on the Agreement stressing that it runs counterproductive to the spirit of the Agreement and gives the impression that Nigeria is engaging in economic nationalism. This they believe may lead to disagreements with other countries as the imposition of the ban may impede free movement of goods across borders.
Responding to the criticisms, the Central Bank of Nigeria (CBN) said that the proposed foreign exchange ban on food imports in Nigeria, will not affect the country’s potential benefit from the recently signed African Continental Free Trade Agreement (AfCFTA). According to the Governor of the apex bank, Mr. Gowdin Emefiele the ban will not affect the content of the AfCFTA because AfCTA is an agreement that is ongoing; the terms of engagement are still being discussed and negotiated. He however said that the important thing is that Nigeria needs to stand as the largest economy in Africa and the largest populated country in Africa, “we need to stand and dictate the terms under which we want to be in it and this is what we are saying.” When we get into the AfCFTA issues, we will also look at the details of it, but at this time, we are saying we need to create jobs for our country, for the youths. We yearn for growth and the only way we can really accelerate growth in Nigeria between now and next four years is to see to it that items that can be produced in Nigeria are indeed produced in Nigeria rather than being imported into the country.
Reacting to the Governor’s take, Mr. Richard Mbaram pointed out the most striking implication of the Forex ban is a positive one in that it basically creates a situation where hurdles are placed on the path of importers of food and other Agro commodities. Mr. Mbaram noted that the development will make it expensive for importers of such products to finance these imports. It must be kept in mind that these commodities are not in themselves banned, but that they are merely being handed hostile terms, he added.
Critics have pointed out the government’s response is knee jerk lacking deeper reflection. They note that if the government wants to conserve forex and protect the naira, it is deliberately looking at the wrong direction. No country is fully self sufficient in food production thus emphasis should be on food security instead of food self sufficiency. Mr. Tijani Gbolahan, an economist wondered why a country that spends trillions of naira importing petroleum products that it has in abundance should focus on food that it does not have. A malnourished person does not care where the food comes from as long as it is safe and edible, he concluded.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry.