May 8, 2021
  • May 8, 2021

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CBN moves to impose forex restriction on Sugar, wheat importations

The Central Bank of Nigeria (CBN) said it will soon impose foreign exchange restrictions on the importation of wheat and sugar in its bid to conserve dollar reserves.

Governor of the bank, Gowin Emefiele said the regulatory bank was working to include sugar and wheat on the list of commodities that would be restricted from accessing foreign exchange.

Emefiele, who spoke while on an inspection tour of the proposed $500m Dangote sugar processing facility, said the country spends about $600 million to $1billion on the importation of sugar annually.

“We are looking at sugar and wheat. We started a programme on milk about two years ago, eventually, these products will go into our forex restriction list.”

“We just want to see to what extent we see the traction that is coming from those currently importing those items. We are putting their feet on fire to say we must all work together to produce these goods in Nigeria rather than import them,” the CBN governor stated.

Emefiele pledged support for the $500 million Dangote Sugar project, which is expected to commence production by 2023.

He said in line with the pronouncement of the president on local food production and self-sufficiency, the sugar complex deserved government’s support.

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Emefiele assured Dangote that CBN would provide forex for the importation of equipment for the project.

On how much the CBN could commit to the sugar project, Emefiele said: “We have not made up our mind but as you heard from Dangote, it’s a project of about $500 million.

“And if you convert that in naira, you know what that is. I know he’s going to commit some equities to it. From there we will determine the shortfall and we will come in through intervention through the banks.
“Of course, foreign currency will be provided as long as it is for importation of equipment for the project through the banks for whatever loans required.

“And we will gradually begin to restrict allocation of FX to those who want to import sugar until we achieve these results,” he said.
Emefiele thanked Dangote for supporting the government’s backward integration programme.

He described the 60,000-hectare sugar complex as a big project that is unprecedented.
“This is four to five times bigger than the sugar project Buhari commission in Niger State two years ago.”
He stated that the factory would create jobs and increase revenue for the state as well as boost its economic viability.

Also speaking, Aliko Dangote said the project had the prospects of providing about one third of the country’s sugar consumption, adding that the initial investment will be about $500 million.
He said the target was to achieve about 250 million tonnes production from the plant when it is ready.

Dangote said the project will generate 150,000 jobs within and outside the state to help solve employment challenges.

He said the project would also help solve the challenges of power in the state, as it will generate an excess of about 90 megawatts of electricity to power the state, using ethanol.
“To the state, it means the place will be up and running. I don’t think there will be shortages of power in Nasarawa State.”

Dangote also thanked the federal government for introducing the National Sugar Master Plan, describing it as a good policy which encouraged players in the sector to embark on backward integration, “not just for us to make money from sugar refinery.”