Stakeholders concerned over non-implementation of proposed rice tariff reduction
The importance of rice to consumers on one hand and its economic viability to the nation on the other cannot be overemphasised. Rice production and importation into Nigeria have been at the fore of the nation’s discourse, especially against the backdrop of the Federal Government’s determination to boost agriculture, ensure food security and encourage backward interpretation.
However, one serious issue which stakeholders currently believe is short-changing the potentials of the rice sub-sector is the non-implementation of the $190 per metric tonne import tariff agreed by the government. This is a reduction from the current $570 per metric tonne.
According to Shaibu Mohammed, secretary general, Rice Millers, Importers and Distributors Association of Nigeria (RiMIDAN), over 20 vessels conveying the product are trapped and stocked in Nigerian territorial waters due to non-take off of the new tariff regime. The situation has resulted in massive loss of revenue both to the government and importers, while consumers continue to groan over smuggled rice from mainly neighbouring countries, particularly Republic of Benin. It is claimed that over 3 million tons of parboiled rice were smuggled into Nigeria through Benin Republic last year. Over N300 billion revenue loss to the government was incurred while Benin Republic and others allegedly gained over N200 billion via smuggling.
Most of the rice that come into the country illegally often pass through conditions that reduce their country, according to industry watchers. Recently, the Federal Government through the Inter-ministerial Committee on Dutiable Rate held a stakeholders meeting with the rice dealers in Abuja. The meeting was meant to quickly arrest the rate of smuggled rice through the neighbouring countries like Republic of Benin.
It was agreed that in order to discourage the rate at which the commodity was smuggled into the country, a new duty tariff that was almost import-friendly and commensurate with what obtained in the neighbouring countries was good enough, hence the duty for legally imported rice was pegged at $190.
The stakeholders say it is regrettable, though that the government reviewed the dutiable price, the measure was yet to be implemented leading to dislocations and unease within the rice industry in Nigeria. Stakeholders lament that $570 remains the duty for rice in Nigeria despite international price crash and stiff competition from the Benin Republic. The claim is that to further boost the volume of
Nigeria-bound rice through its ports, Benin Republic deliberately crashed dutiable rate to $200 per ton. This made the place a haven of sorts for smugglers of the product into Nigeria.
The apparent inaction of the government has made it impossible to improve the value chain on rice, as less than 100,000 tons of rice was legally imported into Nigeria last year.
Mohammed Abubakar, chairman, Rice Millers Association of Nigeria, said continued inaction will create lack in the present administration, as “we all agreed at the meeting to introduce palliative duty and incentive in the sector to reduce smuggling of rice. Somewhere along the line someone is holding the entire nation to ransom.
“We urged Mr. President, as a listening leader to intervene in the issue. Quote me any where, smuggling is not only affecting the farmer but it is rather killing them.
“The rice protectionist policy human face and Nigeria is losing.’’
To Esther Olumilayo, chairperson, Rice Dealers Association of Nigeria, this calls for urgent need to ensure the availability of the product in the country if the government means well in its transformation agenda, especially as it affect the agricultural sector. One major way to do this, is for the government to further reduce duty on rice or quickly implement the palliative duty introduced in December last year.
By: Osa Victor Obayagbona