RIPAN threatens shutdown, says rice importation will crash N14trn industry
By Yusuf Issa An-Nuphawi
Rice Processors Association of Nigeria, RIPAN, has threatened to shut down factories as any attempt by the federal government to open borders for rice importation will collapse the local milling industry worth N4 trillion, causing job and investment losses.
The spokesperson of RIPAN, Alhaji Abba Dantata, gave the warning on Wednesday while playing host to the Association of Kano Online Journalists, ASKOJ, in his office.
DAILY COMMERCE reports that eight years after, the Central Bank of Nigeria, CBN, on October 12, 2023 announced lift of the foreign exchange restrictions it placed on the importation of rice and other 42 items.
The immediate-past administration of President Muhammadu Buhari had restricted the importation of rice and some other items in a bid to grow local production with CBN’s total funding to 42 integrated rice millers under the Paddy Aggregation Scheme, PAS, reaching N106.39bn in 2022, according to former CBN Governor Godwin Emefiele who is now under security custody as he battles litigation bothering on corruption.
Despite the government’s financial interventions including corruption ridden Anchored Borrowers’ Programme in the rice value chain, food inflation continued mounting from average 9.01 per cent in 2015 reaching 26.5 per cent in September, 2023 as the average price of 50kg bag of Nigerian Rice now ₦45,000 at retail stores against average ₦9,000 when Buhari became the President.
Local rice processors have blamed ballooning price of the basic food on high cost of energy, rising and unavailability of foreign exchange and artificial scarcity of paddy rice created by middlemen, hoarding the raw material.
Speaking to journalists in Kano, Dantata disclosed that RIPAN has sought an audience with the government to understand its position on rice importation, saying: “We have not heard from the government directly what the intention is. I’m sure the government means well, and they’re not going to open up the economy for dumping of any goods”.
Importers who were previously restricted from purchasing foreign exchange for 43 specific items on official windows, as outlined in the 2015 Circular referenced TED/FEFPC/GEN/O1/010 and its addendums, are now allowed to participate in the Nigerian Foreign Exchange Market to buy foreign currency for their transactions, suggesting President Bola Ahmed Tinubu’s approval for border opening for the importation of foreign rice.
Still in doubt of the government’s intention, Dantata said: “They know that they have over 200 million people to feed and an economy to grow. Therefore, I doubt if the government will close its eyes and allow any kind of things to be dumped in the country”.
Continuing, Dantata said, “If they do that (allowing importation of rice), everything that has been done to grow the rice sector will crash. The rice sector today is worth over N4 trillion from a few billions in 2015”.
Emphasizing what is at stake, Dantata said “A N4 trillion worth of investment is not a joke. We have more than 80 big companies, the smallest of which process rice paddy of around 150,000 tons per annum. We employed about 1,000 people in each company. In the rice industry today, we pay nothing less than N50,000 as a minimum wage”.
He urged President Tinubu to turn deaf ears to calls for rice importation, saying, “If the government decides to open up the borders for rice importation, millions of Nigerians will lose their jobs and the industry will collapse”.
Speaking on the wayout for RIPAN members if the government opens the borders for importation, Abba Dantata, who is also the Chairman of Fursa Food Ltd., millers of Fursa Crown Rice in Kano said: “I’m going to shut down. It’s easier for me to import than to produce because I have double taxation here and there. We have the price of diesel going up, the headache of processing, the headache of dealing with employees and all that”.
