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Rice backward integration policy attracts over $1.6bn investment

By Gabriel Ewepo & Caleb Ayansina

THE Backward Integration Programme (BIP ) policy in the rice sector  put in place by the federal ministry of Agriculture to boost local rice production with  the approval of an inbuilt tariff/levy differential deliberately skewed in favour of investors has been commended by stakeholders.

The policy, which is said to have attracted more than $1.6 billion of private sector investments, allows investors to temporarily import brown or finished rice to bridge the present gap in supply and demand.

Supply and demand

farm-1Those who have keyed into the policy are allowed to enjoy 10% tariff and 20% levy on imported rice, while on the other hand mere rice traders are allowed to import at 10% tariff and 60% levy.

Curiously, this apparent federal government’s magnanimity aimed at massive rice value chain in the country did not go down well with an aggrieved group which members have millers and farmers and therefore thought that the Government’s largesse was meant to bring in “intruders” or “outsiders” into the rice business.

Again, there was the spurious claim that the waivers and import quotas would exacerbate the rate and level of smuggling of the commodity into Nigeria from neighbouring countries especially Republic of Benin.

But the President of the Nigeria Rice Investors Group, Tunji Owoeye, said the  policy has not only discouraged smuggling but has also led to a quantum leap in investment into Backward Integration Programme, adding that the policy was geared towards self-sufficiency in rice production in the country.

According to the group, this was the first time; import quota was being allocated to the right people with verifiable investments in rice production in the country.

Owoeye noted that there had been significant improvement since the review of the policy, adding that the rice policy of the present administration is visible for all to see.

“If you travel through Zamfara, Niger, Benue, Sokoto and many other states in the country, you will see vast plantation of rice in the last two year.

“We have also seen some of our members who were pure traders making huge investment in local rice production. We have seen serious increase in employment and value creation in the rice sector,” he said.

Owoeye, who is also the Managing Director of Elephant Group, said that the federal government had provided rice investors with improved seedling which has led his members to having better rice production.

The Former Minister of Justice and Attorney General of the Federation, Michael Aondoakaa and Secretary Rice Processors Association of Nigeria (RIPAN) commended the present administration for matching his words with actions, by not allowing the business to be as usual in rice production.

“The truth is that many have wished the old system where some highly connected people influence rice quota allocation, but this administration made sure it went to rice farmers with visible investments,” he said.

On his part, the President of Rice Millers, Importers and Distributors’ Association of Nigeria, Abubakar Mohammed noted that five years ago there was only one processing mill in the whole of Nigeria, but with the commitment of the government, it had increased to 24. Abubakar said that that before the present administration, rice paddy produced from Nigeria was one of the worst in the world, but added that, currently, it is one of the best in the world.

”We process 800,000 tonnes of paddy rice annually and the government is putting measures in place to produce additional 360,000 tonnes.

”All these happened by the help of President Goodluck Jonathan and the minister of Agriculture, Dr. Akinwunmi Adesina,” said Abubakar.


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