CBN To Impose Forex Restriction On Milk Importation

Central Bank Governor, Godwin Emefiele.

SAN FRANCISCO, July 24, (THEWILL) – The Central Bank of Nigeria (CBN) has said it will place foreign exchange (forex) restrictions on milk importers into the country.

Addressing reporters at the end of the bi-monthly Monetary Policy Committee (MPC) meeting in Abuja, CBN Governor, Godwin Emefiele lamented that between $1.2 billion and $1.5 billion are spent yearly to import milk into the country.

“We can no longer continue to spend close to $1.2 billion to $1.5 billion, importing milk into the country, a product we can produce. To some extent, they (milk importers) should help us also to reduce the rate of herders, farmers conflict,” he said.

At the end of the meeting, MPC members voted to: Retain the MPR at 13.50 per cent; Retain the asymmetric corridor of +200/-500 basis points around the MPR; Retain the CRR at 22.5 per cent; and retain the Liquidity Ratio at 30 per cent.

Emefiele said the CBN had held several meeting with milk importers, the first being about three years ago, after the introduction of forex restrictions on over 40 items.

“About three and half years ago, when the policy on restriction of forex started, we considered including milk on the list of items under restriction from forex, but we conjectured that based on sentiment some people are bound to express, that we should be very careful.

“We called on the management of the oldest milk importer into Nigeria, WAMCO into Central Bank office in Lagos. We held at least three meetings with them and we told them this would have happened but we decided not to allow it to happen.

“We are trying to use the opportunity to appeal to them to do backward integration. ‘Integrate backward and begin the process of development and produce your milk in Nigeria,” he said.

He said the importers “could also support the pastoralists, get them concentrated in one place instead of moving around. Provide them facilities like water, hospitals, schools.

“If you are in a community and you want to enjoy the proceeds of that community there is nothing wrong in providing certain things for the commiunites to blossom. The proceeds of what you get in return will be your milk to recoup your investments.

“Those are the kind of things we expect companies that are importing milk into Nigeria to do. Unfortunately, after three years, nothing has happened.”