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‘It’s to protect local industries’ — Emefiele defends stance on FX restriction for milk importers

‘It’s to protect local industries’ — Emefiele defends stance on FX restriction for milk importers
March 17
15:50 2021

Godwin Emefiele, governor of the Central Bank of Nigeria (CBN), has defended the apex bank’s action in restricting the sale of foreign exchange (FX) to milk importers.

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He was speaking on Tuesday, during a meeting with Ngozi Okonjo-Iweala, director-general of the World Trade Organisation (WTO), in Abuja.

This follows concerns raised by Okonjo-Iweala that the European Union (EU) had filed complaints against Nigeria over policy restrictions placed on milk and dairy products importation.

Reacting, Emefiele explained that the trade restriction policy was meant to protect local industries and also give a chance to these industries in creating jobs for Nigerians.

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“We do know one way or the other, people may have said a few things about the way we have conducted our trade, but I think it’s important for me to say that some of those things have been done to also help protect our own industries,” he said.

“The fact that we need to create jobs for this set of people, we need to create an enabling environment for this set of people to live a gainful life, means that we have a responsibility to do so and in doing so, we will need the support of institutions like yourself (WTO) to work with us.”

Emefiele also said the policy was due to dairy companies who refused to align with CBN’s backward integration programme.

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“We called a meeting about six years ago when I resumed. I said look, Nigeria has dairy potential by the cattle and the rest of them, let’s see what can be done. Nothing was done,” he said.

“Two years ago, we started again, we said listen, we are going to start a programme where we are going to place FX restrictions on those who want to import dairy into Nigeria. Six of them came on board- Friesland and a few of them.

“At that meeting, we took a decision that those who are not embracing our own backward integration programme in the dairy industry should be restricted.

“It was not my decision, it was a decision taken. Before you (Okonjo-Iweala) were probably born or before I was born, Friesland Campina has been importing milk into Nigeria, how come for over 60 years nothing has been done by this company to backward integrate and begin to produce dairy in Nigeria?

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“Does that mean Nigeria does not have the potential? The answer is no. So that’s why we in the monetary and fiscal authority must put everybody’s feet on fire so that the right things are done for the good of Nigeria and Nigerians.”

Responding, Okonjo-Iweala advised Nigeria to embrace WTO’s trade remedies which could help protect local industries without placing a ban on imports.

The apex bank had announced the policy in 2019 as a means of boosting local production, conserve scarce foreign exchange and create jobs.

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