FG Won’t Allow Sugar Importation Under AfCFTA–Sugar Council

The implementation of the Africa Continental Free Trade Agreement will not affect the Federal Government Backward Integration Policy in the sugar sector.

The Executive Secretary of the Nigeria Sugar Development Council, Dr Latif Busari said this on Tuesday in Abuja during a chat with journalists.

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The Federal Government had in 2013 banned the importation of raw sugar into the country in a bid to raise local sugar production to attain self sufficiency, stem the tide of high level importation, create huge number of jobs as well as contribute to the production of ethanol and generation of electricity.

Despite the objectives of the AfCTA to liberalise trade within the African continent, Busari said the Federal Government would not allow the importation of sugar into the country as such move negates the Backward Integration Strategy as encapsulated under the Nigeria Sugar Masterplan

The Federal Executive Council had at its 37th meeting held on September 19, 2012 approved the Nigeria Sugar Masterplan for implementation and adoption as government strategy roadmap for the development of the sugar sub-sector.

The plan contains fiscal and investment specific incentives designed to stimulate and attract new investors to the industry in order to increase local sugar production and reduce the nation’s dependence on imports.

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The Federal Government’s plan for the sector is to guarantee huge return on investments for all players, attain self-sufficiency, create jobs, generate electricity and derive other benefits of the sugarcane value chain as contained in the Nigeria Sugar Master Plan.

He restated government’s readiness to build a globally competitive sugar industry, adding that the implementation of the ACFTA would not affect the plan of government for the sugar sector.

The AfCFTA will bring together all 55 member states of the African Union covering a market of more than 1.2 billion people, including a growing middle class, and a combined gross domestic product of more than $3.4trn.

In terms of numbers of participating countries, the AfCFTA will be the world’s largest free trade area since the formation of the World Trade Organization.

Estimates from the Economic Commission for Africa suggest that the AfCFTA has the potential both to boost intra-African trade by 52.3 percent by eliminating import duties, and to double this trade if non-tariff barriers are also reduced.

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The main objectives of the AfCFTA are to create a single continental market for goods and services, with free movement of business persons and investments, and thus pave the way for accelerating the establishment of the Customs Union.

It will also expand intra-African trade through better harmonization and coordination of trade liberalization and facilitation and instruments across the RECs and across Africa in general.

But Busari who was represented at the briefing by the Director, Policy, Planning, Research and Statistics, Mr Hezekiah Kolawole said the importation of sugar will not be included in ACFTA as it takes off in January next year.

He said based on the implementation of the pact, the Nigeria Sugar Masterplan has already been secured under the AfCTA.

He said, “The implementation of the Nigerian Sugar Masterplan has been classified in a section under the AfCFTA that will allow us to continue the implementation of these programme till the very end.

“So importation of sugar will not be included under the AfCFTA when it starts in January. And you know that there is the rule of origin principle under ACFTA that make it difficult to import sugar from elsewhere and say you want to export it to another country.

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“What you must export is something that you manufacture in your own country that you can export under this AfCFTA platform.

“The rule of origin will play out under the AFCTA platform. We don’t have any problems with regard to AfCFTA coming into operation on January because sugar industry is among those classified for ten years allowance for the implementation of the policy to be effected and sugar will be locally produced in Nigeria.”

On the flooding that threatened over N60bn sugar investments in Niger State, he said the Council would continue to provide all the necessary policy support and regulatory assistance for the sector to thrive.

He said while no financial intervention had been made from the Sugar Council to those affected by the flooding, it had opened discussions with the Central Bank of Nigeria to enable the companies access development fund to ease their financial burden.

He urged investors to take advantage of the policy of government to invest in the sector.

According to the Nigeria Sugar Masterplan, a total investments of $3.1bn (N1.17trn) would be needed from the private sector to effectively implement the sugar policy.

He said, “The opportunity is there for more investors, we want more investors because the opportunity is there for us to take over the sugar market in Africa.

“The resources are there and we are making effort in that direction and soon, we will achieve that objective.”

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