Labour union calls for FX policy review on tomatoes paste concentrate

The labour union officials in some of the local tomato processing companies have called on the Central Bank of Nigeria (CBN) to review its forex policy listing of triple concentrate tomato paste among the 41 items restricted from accessing foreign exchange from the official window by the (CBN), as the inability of the firms to import tomato concentrate which is the main raw materials used in their production process had drastically affected them.

According to Lateef Oyelekan, president, National Union of Food, Beverage and Tobacco Employees (NUBTE), the companies involved should be given the latitude to plan for backward integration as one of the downside of the policy is that it could lead to massive job losses, as an estimated 1000 jobs are likely to be lost in the tomato process manufacturing sector.

“The jobs of the workers are at stake unless the ban is reversed, and that the opportunity for backward integration would be lost by the affected companies,” he said.

Oyelekan stated that the quantity of the produce being cultivated presently in the country is not enough for local consumption and the quality is not good enough to be processed into paste.

He pointed out that it would take years for the planting, harvesting and processing of the produce into concentrate, adding that most of the companies had run out of stock.

Oyelekan explained that the volatility factor inherent in tomato farming is often a product of seasonal variations, which is itself a function of the variables of weather, agronomy, water, seed, fertilizer, market, storage, transportation, and numerous other agro-allied business dynamics.

“If triple concentrate tomato paste is now placed among the list of items that will not have access to the foreign exchange market overnight, that line of business has been killed because the government is working from the perspective that there are tomatoes in the environment for cultivation, processing into paste and packaging. Rather than prohibiting the items overnight, why not engage the manufacturers in discussion.”

He expressed that the objective of the forex restriction was not a bad idea on its own; however lamented that the implementation of the policy has far-reaching implication in the short, medium and long term.

Also speaking on the policy, Remi Bello, president, Lagos Chamber of Commerce and Industry (LCCI), warned that most manufacturers might be forced to shut down and move their operations to neighbouring countries due to their inability to access foreign exchange for raw materials and other critical inputs.

Bello said the government needs to first address the issue of post-harvest wastage emanating from inadequate storage and the absence of processing facilities and the development of agro-allied industry.

“No matter how bounteous the nation’s harvest is, such productivity will count for little if the produce cannot be stored”. He said.