Nigeria: Smuggling - Why Border Drill Must Be Sustained for Self-Sufficiency in Rice Production

9 January 2021

With the reopening of the border in the country, TUNDE OGUNTOLA writes the need for Customs officials and other security agencies to efficiently secure the border against the importation of smuggled rice and other banned products to protect the huge investment in the rice production value chain amidst endless importation of smuggled foreign rice into the country

When President Muhammadu Buhari ordered the partial closure of the land borders in August 2019 due to massive smuggling activities, especially rice, many saw it as a fulfillment of one of his campaign promises to increase local production of rice amidst the nation's countless and unheeded calls to her neighbours to stop aiding and abetting smuggling, which apparently is damaging the nation's economy.

A fortnight ago, the federal government ordered the reopening of the land borders at Seme, Illela, Maigatari, and Mfun raising fears in the rice production value chain. But the finance minister Zainab Ahmed said: "President Buhari's instructions on the ban on importation of rice, poultry and other products still subsists and will be implemented by border patrol teams."

However, LEADERSHIP Weekend findings show the smugglers, on a daily basis, transport rice unabated via Babura, Mai Mujiya in Niger Republic, Kongolam in Sokoto State to Nigeria and Daura. Others are Babban-Mutun, Babura, Yarkiyrya junction, Kanye Babba, Dandi, Garkin Daura, Baure, Achakwale, Maibara, Yaduna, Karkarna, Babura, Insha Ruwa, Masko, Batali, Yarkirya, Kanya Babba, Kore, Mai'Adua, Dogon hawa, Shargalle Junction, Dutsi, Kwarnar Sandamu, Fago, Kazaure and Kwanar Dumawa.

Prior to the border drill, Benin Republic with a population of about 11 million people imports 1.2 million metric tons of rice annually. Although Benin Republic is not alone as Niger Republic, Chad and Cameroon form the other members of the devious quartet in this sabotage threatening Nigeria's domestic rice production; hence the authorities then vowed not to reopen the borders until the affected countries learn to conduct themselves responsibly and in line with the principles that undergird the ECOWAS protocol on the free movement of goods and services.

Amidst the drill, Nigerians invested heavily in the agriculture value chain, with support from the Central Bank of Nigeria (CBN) rice Anchor Borrowers Programme. However, the truth must be told with the reopening of the border, we all know that Nigeria has one of the most porous borders in the world, aggravated by alleged and shoddy practices by some alleged corrupt Customs officials and other state actors amidst porous 84 land borders with over 1,400 rogue routes.

However, as the federal government announced the reopening of some land borders, investors in the rice production value chain have expressed deep concern proposing stringent measures to curb illicit businesses carried out by criminal-minded persons undermining the prohibition of some items by the government including rice and other goods.

Speaking to LEADERSHIP Weekend, rice millers under the auspices of Rice Millers Association of Nigeria (RIMAN) charged security personnel representing the country at the borders to be diligent, honest, and patriotic in enforcing the law in the interest of economic growth and national development.

The national president, RIMAN, Peter Dama, proposed an increased tariff on imported rice as a panacea to safeguard the massive investment in the sector, adding such import should be made to pass only through the seaports.

"If they can bring rice to Abuja, the seat of government where the presidency is, and where the Customs headquarters is cited, it shows that the Customs must step up their efforts to avert jeopardizing the massive investment in the rice production value chain," he said.

Dama, who raised the alarm following fears of connivance by some government security personnel with those who smuggle prohibited items into the country, said "Some of the proposed measures include the increase of tariff on imported rice and should be made to pass through the seaports; engaging neigbouring countries on treaties signed in regards to the movement of goods and persons; not to allow Nigeria to be a dumping ground for foreign goods; joint border patrol teams be re-established; punitive measures meted out to offenders of the law, and others."

He said: "The Nigerian Custom personnel should be honest in carrying out their duties. They should not compromise their positions by collecting bribes and allowing the foreign rice to come into the country through unauthorized routes.

"The Nigerian government should raise the tariff of imported rice and no foreign rice should be allowed into the country through land borders except through our seaports."

In line with ECOWAS protocol, he said the federal government should also engage neighbouring countries, urging them not to accept the dumping of foreign imported rice in their countries with the intention of transporting them to Nigeria.

He continued: "A joint border patrol team should be set up to monitor the exportation of rice to Nigeria through unauthorized routes. There should be punitive measures for any violation of these measures.

"The border communities who depended on this illegal trade should be made to engage on legitimate trading with their neighbours instead of helping to destroy our economy by facilitating smuggling at the borders."

Speaking further, the RIMAN boss stated that the federal government should deploy drones and other technologies to monitor the nation's porous borders, stressing the Nigerian Customs Service (NCS) should be properly equipped adequately including other security agents to man the borders.

He also noted that the Ministry of Finance should ensure immediate review of Nigeria's tariff on imported rice and also that our Customs personnel are well remunerated with good welfare packages that will not make them compromise with smugglers.

Dama also said that the Ministry of Trade and Investments together with NAFDAC should notify Nigerians about the dangers of consuming imported rice that has been stored and preserved in silos with chemicals abroad and the dangers it poses to the health of Nigerians.

"The trade agreement entered into with our neighbors should not be allowed to make our country a dumping ground for foreign products that we can equally produce as this will affect our investments that will lead to job losses for our citizens while creating jobs for other nations.

"While the Federal Ministry of Information and Culture should intensify public awareness on the issues of smuggling as a criminal offence, dangers of consuming imported rice, aiding and abetting smugglers, the negative impact of smuggling on the economy as it creates unemployment and collapsing of investments," he added.

Meanwhile, the national coordinator, Nigeria Farmers Group and Cooperative Society (NFGCS), Mr Retson Tedheke, has pointed out imported rice is making its way into the country whether legally or otherwise, noting the physical closure of the border is just one aspect of safeguarding and securing local production, even though, he said, the society was told reopening the border does not affect importation of food, stressing this implies food importation is still banned.

"But surprisingly we still see chunks of foreign rice everywhere. This is sad," he said.

Tedheke, however, recommended a change in the government's aggressive rhetoric on rice importation, calling on Custom officials to step up their game.

According to him, "What I think needs to be done to protect the people who have invested in the sector is to look at other means of ensuring that what the closure of the border could not do those other components can do, I am always looking up to the Asian countries particularly China and Thailand.

"What they did was to safeguard their local industries, they introduced several measures one amongst them was border closure at a time after the closure, they introduced a very high tariff on what can be produced locally in their country. It is happening now even in capitalist states like the USA. Like I always say we should not listen to what they say, we should look at what they do.

"For instance, making America great is all about protecting American industries and made in America, now what the government must begin to do therefore is to look at what Nigerians can produce.

"Nigeria can produce rice, soybeans, among others. Nigeria can produce all the food we need. We have 84 hectares of arable land, what we must do is to safeguard our borders and tell importers to bring in those commodities through the land borders and seaports and raise the tariff. For example, if you are importing 500 metric tonnes of rice the tariff should be 500 per cent so that the cost of foreign rice in Nigeria will be times two of our own cost of local production."

He explained that such a high tariff will discourage people from importing goods that can be produced in the country.

"Nigeria Customs must up their game in safeguarding the nation from economic saboteurs who have formed the habit of destroying our own country in the name of buying cheap because at the end of the day, when you are interested in developing the local economy you must be interested in looking at agriculture as a source of development," he said.

He noted that there is no sector in the Nigerian economy that has the potential and capacity of taking millions of our people out of the streets and giving them jobs like the agricultural sector.

"There is no sector with the potential of helping us solve our insecurity crisis like agriculture, there is no sector that has the capacity of growing our nation like the agriculture sector, what we have to do is to preserve this sector by doing everything possible to ensure that internal economic saboteurs who have turned smuggling to their industry fail.

"Also, we need to ensure that goods that we can produce here are not imported. We must ensure that what we can produce at home is what we consume or else we will be killing our economy and it is going to affect every home in Nigeria if we don't do the needful."

He stressed the government should continue to make Nigeria's goods and products more competitive than foreign goods.

To kick-start and sustain its ambitious agriculture revolution, he said the government should block the enduring loopholes along the local agriculture value chain and also inject more money in the rural areas and agriculture sector.

"We must stop audio farming, politicians have access to money but the local Nigerians don't," he said. Tedheke added that once the money is in the hands of local farmers it should be monitored by extension workers to ensure that they use it properly.

In attempting to clamp down on imports while local production still falls short of demand, he said CBN should start giving loans at two or three per cent.

"We should get to a point where they can give money to local farmers to be paying back at two or three per cent because you see the big firms like Olams and Stallions of this country get their monies from their countries at two or three per cent in their country but a Nigerian man gets his own at nine per cent if he is lucky to get from the CBN, how can he compete?

"While if he gets from the commercial banks the loan interest is about 25 to 30 per cent. If you look at all of the rates that are heaping on a Nigerian producer, you will know that it is insane. CBN must come in and start giving money at about two or three per cent if this is done, I can assure you that we will be sufficient," he added.

On his part, the CEO, Evergreen International Company Limited, Amb. Ayola Joseph Lewu, noted the opening of the border is a good thing that has happened because Nigeria is a member of the African Continental Free Trade Area (AfCFTA) and a leading member of ECOWAS and the World Trade Organisation (WTO).

"All these are organisations and treaties to which Nigeria is a member and has ratified. However, we have been breaching these treaties, maybe, because of the need for security of the nation due to the free movement of small arms and animations. But can we afford to close our borders forever and be breaking international treaties to which, we have signed?" he asked, adding that the nation should comply with the signed treaties.

"As far as the argument for security of the country is concerned, what we should do is to police our borders effectively. We may not attain 100 per cent effectiveness in this regard but at least it will reduce considerably. Opening our borders will help to bring in a lot of materials that we don't have in the country which are needed for industrial and agricultural production.

"However, there are certain commodities that are said to be banned from coming into the country. If they are coming in through our legitimate ports then we can impose a lot of tariffs on them and allow the goods in. I don't think that banning them altogether is the correct approach.

"Nigeria can say that some goods should not be brought in through the land borders but to the ports but unfortunately, Nigeria is not managing its ports very well. Look what is happening in Lagos- in Apapa and Tin Can- the whole place is choked up.

"Over the years one would have expected that Nigeria would have developed the other coastal ports like Warri, Calabar, Onne or Port Harcourt. We neglected all that and now when faced with these problems we resort to the fire brigade approach. That is why planning is important because you don't just plan for 1 year or 4 years of a regime. We need long-term plans because the country is growing and the population too is growing. Our infrastructures should go inline with the rate of population growth," he said.

Correspondingly, he said the government should ensure that rice is not imported through the land borders but the seaports with a high tariff.

He said this will enable our farmers to take advantage of the gap between demand and supply and be able to work harder to take charge of meeting the supply-demand of the country.

Lewu also said the government should assist farmers particularly in the area of input supply. He said hoes and cutlass are not the best for our agriculture but yet we still have 60 to 70 per cent of our farmers still doing rice production the old way.

"We need mechanization, simple motorised equipment like planters and sprayers and weed control. If you see what is happening in Asian countries like Malaysia, Thailand, Indonesia and India, you noticed that they are using simple equipment that are not as heavy and expensive as tractors. Such equipment can be brought into our country and given to the farmers at subsidised rates.

"Again, the cost of production is extremely too high and that is why we are not internationally competitive. People are ready to buy rice but if the rice produce has stones in them, they will prefer foreign rice even when it has stayed many years in the warehouses abroad.

"We should also have rice mills that are closer to the people. We cannot get the best without the assistance of government both local, state, and federal government."

He added research institutes should be well-funded so that the correct varieties of rice in Nigeria are produced and commercialised so that adoption by farmers will be higher than what it is at the moment.

Also, the CEO, Mamora Rice Nigeria Limited, Alhaji Abdulrauf Adekunle Lawal, opined the border opening will have a negative effect on local investment in the rice production value chain.

"In the rice value chain there are a lot of actors involved, we have the input dealers, aggregators, the farmer who is the primary source of raw material, paddy cultivators, millers, input dealers, wholesalers, fertilizers, herbicide manufacturers, chemicals and seeds, distributors and marketers.

"The real effect of the border reopening is not noticeable for now because of yuletide. It also takes about eight weeks for imported rice to arrive at the Benin Border from Indonesia, Pakistan, India, or Vietnam. We will be seeing the real effects after eight weeks from now," he said.

He harped on the need for Nigeria farmers to produce quality rice.

"Traditionally, Nigerian rice is better than the imported rice but if we can improve the standard of our rice then, the foreign rice will be a thing of the past. The onus is on us that are in the value chain to standardise the process.

"But the problem we have here is the high cost of production including electricity. I just bought N5,000 worth of electricity and they gave me units of 34.7 kwh. Back then, N5000 could give you 100 kwh units. Electricity is a challenge and if you want to use a power generator, you would have to buy petrol or diesel. That is why we are not competitive in terms of price. Apart from the quality, the price is something else we need to work on.

"The Customs officers at the borders should be proactive to avoid smuggling the imported rice into Nigeria. The rice in 50kg bags is transported through bush parts on motorcycles daily.

"Nigerians should imbibe the culture of rice cultivation. There are different varieties of rice even the ones that can grow on dry land.

"The research institutes are developing varieties of rice daily that can even grow up to three times in a year. The more we produce rice, the more standardised the rice becomes and the better for consumers," he added.

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