Nigeria May Suspend Taxes on Certain Food Imports To Combat Soaring Prices

There are strong indications that Nigeria’s federal government is actively considering a raft of fiscal measures to mitigate the worsening food crisis which has pushed prices of food items beyond the reach of citizens, and contain escalating inflation.

A highly placed presidency official confirmed the move to THISDAY Monday night in a telephone conversation while responding to an inquiry on the report that the federal government had approved duty-free tariffs on some food items.

Although he did not provide details on the impending measures, the presidency source, however, disclosed that suspension of taxes and duties on some food items were part of measures aimed at mitigating the fallout of ongoing reforms. 

“We want to ensure that Nigerians have food on their tables, we are very concerned about the prices of foodstuff. A formal announcement is coming,” the source stated.

However, the media space was on Monday awash with reports that the federal government had announced certain measures to mitigate the food crisis over the next 180 days.

The reports quoted the Minister of Agriculture and Food Security, Senator Abubakar Kyari, as the source of the information via a purported press conference in Abuja.

But an online platform, Peoples Gazette quoted a presidential spokesman, Bayo Onanuga, as admitting that indeed a  memo was circulating across government departments,  although the planned policy measures had not been finalised.

He added that “the policy was mistakenly circulated. We are still deliberating internationally from the agric ministry to other agencies on how best to proceed with the policy,”  he was quoted to have said.

THISDAY obtained the text of the press briefing purportedly delivered by Kyari.

According to the document, the minister said the government could no longer allow the festering food inflation to persist. 

“It is with deep sense of responsibility that I stand before you today to present to you, the outlined implementation of the Presidential Accelerated Stabilization and Advancement Plan, an initiative of President Bola Ahmed Tinubu, GCFR, to bring about food security and economic stability to Nigeria. 

“Over the past several months, we have all been witnesses to the escalating cost of food items in all parts of the country. There is virtually no food item that has not had its price raised to a level higher than what a good many Nigerians can afford. 

“The affordability crisis in our food security system has been indexed by the data from the National Bureau of Statistics which by the last count, had put food inflation at 40.66%. 

“We have heard the cries of Nigerians over the prices of food items and condiments, with some now describing tomato as gold and proposing a variety of recipes to prepare soups and dishes with some of the overly priced food items. 

“What in the past were regarded as common items such as yam, plantain, potato now command excessively high figures and Nigerians are right to wonder how and why things are the way they are.  

“As a government under the leadership of President Bola Ahmed Tinubu GCFR, members of the Federal Executive Council and indeed all other operatives in the MDAs are fully aware of the hardship occasioned by the high cost of food items in our country.  

“There is no doubt that food inflation is a direct consequence of a number of factors. Agricultural production activities have been hampered in some parts of the country by a number of factors resulting in the inability of smallholder farmers to contribute optimally to the country’s food basket. 

“This has opened a new dimension to the food challenge from affordability to availability of sufficient food commodities. 

“As you may recall, earlier in the year, there were a number of interventions by the Federal Government to make food available and to dampen their prices. 

“Those interventions include: the release of 42,000MT of assorted food commodities from the National Strategic Food Reserve, 58,500MT purchase of milled rice from Rice Processors Association of Nigeria and additional 30,000MT of rice. 

“Regrettably, prices have continued to escalate, and in some cases these days, food items are becoming unavailable.”

According to the statement attributed to Kyari, the government could not allow this situation to persist, adding that there were ongoing agricultural initiatives, programmes and projects under the Federal Ministry of Agriculture and Food Security, just as state governments also had theirs.

He explained that government must respond to the creeping availability crisis, noting that as the government continues to encourage agricultural production on a sustainable and profitable basis for farmers, the time lag between cultivation and harvest makes it inevitable for the government to kick-in stop-gap measures that would bring tremendous relief to Nigerians.

“For instance, harvest for 2024 wet season farming will not be due until October-November. On the one hand, while the measures aim to alleviate immediate food shortages, we will strengthen domestic production capabilities to enhance long term food security.  

“I do not wish to dwell much on other well-known causative factors in our country’s food inflation figures: infrastructural challenges, multiple taxes and levies and then just sheer profiteering by marketers and traders.

“What is important is to let you know that the federal government under President Bola Ahmed Tinubu, GCFR, feels the pain of Nigerians and is earnestly desirous of relieving these pains, stabilising the economy and getting Nigerians back to happy days.

“As you may be aware, in March 2024, the President constituted the Presidential Economic Coordination Council (PECC) under which, the Economic Management Team (EMT) recently presented to Mr. President an Accelerated Stabilization and Advancement Plan. 

“A Two Trillion Naira package was approved to be spent on actualizing the Accelerated Stabilization and Advancement Plan of which Agriculture is a key focused sector,” he said.  

The minister purportedly revealed that the EMT has been meeting day and night working out the best modalities to achieve the best results for Nigerians. 

He, therefore, disclosed that to ameliorate food inflation in the country caused by affordability and exacerbated by availability, the government had taken a raft of measures to be implemented over the next 180 days. 

The measures include a 150-day duty free import window for food commodities. This entails the suspension of duties, tariffs and taxes for the importation of certain food commodities (through land and sea borders).

These commodities include maize, husked brown rice, wheat and cowpeas. Under this arrangement, imported food commodities would be subjected to a Recommended Retail Price (RRP). 

On this, the minister was quoted to have said: “I am aware that some good citizens might be concerned of the quality of the would be imported food commodities as it relates to the trending worries around genetic composition of food).  

“I am glad to reiterate that the government’s position exemplifies standards that would not compromise the safety of the various food items for consumption.”

In addition to the importation by private sector, he stated that the federal government would import 250,000 metric tonnes of wheat and 250,000 metric tonnes of maize. 

The imported food commodities in their semi-processed state would target supplies to the small-scale processors and millers across the country, he said.  

Kyari reportedly said that the federal government would engage relevant stakeholders to set a Guaranteed Minimum Price (GMP) and mop up surplus assorted food commodities to restock the National Strategic Food Reserve. 

There will be a continuous ramp-up production for the 2024/2025 farming cycle, a sustained support to smallholder farmers in the ongoing wet season farming through existing government initiatives as well as  strengthening and acceleration of dry season farming across the country, he was quoted to have said. 

The government, he was further quoted to have said, would equally embark on aggressive agricultural mechanisation and development to reduce drudgery, drive down the cost of production and boost productivity, just as it collaborates with the sub-national to identify irrigable lands and increase land under cultivation. 

Other measures include working closely with the Federal Ministry of Water Resources and Sanitation, to rehabilitate and maintain irrigation facilities under river basin authorities across the federation, development of a strategic engagement for youth and women across the federation for immediate greenhouse cultivation of horticultural crops such as tomatoes and pepper to increase production volume, stabilise prices, and address food shortages.  

He also cited plans towards fast-tracking ongoing engagements with the Nigerian military to rapidly cultivate arable lands under the Defence Farms Scheme, while encouraging other para-military establishments to put secured available arable lands to cultivation.

“The Renewed Hope National Livestock Transformation Implementation Committee will be inaugurated on Tuesday, 9th July 2024 with a view to develop and implement policies that prioritise livestock development and ensure alignment with the National Livestock Transformation Plan,” the minister disclosed.

He added that this was with the view to enhance nutrition security through the promotion of production of fortified food commodities and offer necessary support to scale up the Home Garden Initiative by the Office of The First Lady of the Federal Republic of Nigeria.  

“Over the next 14 days, in close collaboration with the Presidential Food Systems Coordinating Unit (PFSCU) and the Economic Management Team (EMT), we will convene with the respective agencies to finalize the implementation frameworks. 

“We will ensure that information is publicly available to facilitate the participation of all relevant stakeholders across the country. The PFSCU will manage a dashboard for Mr. President, providing him with direct visibility into these interventions and ensuring accountability. 

“In conclusion, the success of the measures aforementioned, is contingent on the cooperation and collaboration of all relevant MDAs and stakeholders. 

“As our nation confronts a critical food security challenge, let me reiterate Mr. President’s unwavering commitment to attaining food security and ensuring that no Nigerian goes to bed hungry.

“To this end, I can assure all Nigerians, that my team and I, will swiftly and diligently actualise these crucial policies to ensure food security for everyone in the country in the immediate term as we also continue our strategies for long term interventions to address the underlying causes and ensure sustainable and resilient food systems in the country,” the minister stated.

Following the purported press briefing, the National President of the Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA), Dele Oye, has immediately commended the federal government’s decision to suspend duties, tariffs, and taxes on the importation of key food commodities.

In a statement, Oye said the decision represented a significant step towards mitigating the severe food inflation currently impacting Nigerian households.

The NACCIMA President also applauded the 150-day duty-free import window for essential items such as maize, husked brown rice, wheat, and cowpeas, describing it as a commendable move that will stabilize food prices and provide much-needed relief to millions of Nigerians.

The statement read: “On behalf of the Nigerian Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA), we commend the federal government’s decisive action to suspend duties, tariffs, and taxes on the importation of key food commodities.

“This initiative, announced by Honourable Minister Abubakar Kyari, represents a significant step towards mitigating the severe food inflation currently impacting Nigerian households.

“The 150-day duty-free import window for essential items such as maize, husked brown rice, wheat, and cowpeas is a commendable move that will likely stabilize food prices and provide much-needed relief to millions of Nigerians.

“By addressing the multiple factors contributing to rising food prices, including infrastructural challenges and market profiteering, this policy demonstrates a comprehensive approach to ensuring food affordability.”

Reiterating the need for stakeholders’ engagement, Oye noted: “However, while we applaud these measures, it is imperative that the government immediately engages with stakeholders across the agricultural value chain.

“This engagement is crucial to ensure that Nigeria is not turned into a dumping ground for commodities where we already have reasonable self-sufficiency. Protecting local investments and sustaining the growth of our agricultural sector must remain a priority.

“NACCIMA stands ready to support the government in these efforts, ensuring that the strategic importation of food commodities complements rather than undermines our domestic agricultural production. 

“Together, we can secure a balanced approach that safeguards both the immediate needs of our citizens and the long-term sustainability of our agricultural economy.”

Ndubuisi Francis

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