Nigeria: CBN Moves to Place Sugar, Wheat On Forex Restriction List

16 April 2021

Abuja — Governor of Central Bank of Nigeria (CBN) Godwin Emefiele has said the bank will soon commence the restriction of forex allocation for importation of sugar and wheat into the country.

Emefiele who said Nigeria spends between $600million to $1billion on importation of sugar, said the apex bank will gradually begin to restrict foreign exchange to those who want to import sugar until Nigeria achieve self-sufgiciency in sugar and wheat production.

"Let me state this, we are looking at sugar and wheat. We started a programme on milk about two years ago. Eventually, these products will go into our FX restriction list. We just want to see to what extent we see the traction that is coming from those who are currently importing these items," the CBN governor said yesterday at the inspection of a sugar production factory by Dangote Group of Industries. "We are putting their feet on fire to say that we must all work together to produce these goods in Nigeria rather than import them," he stated.

The $500million sugar factory is being built on a 60,000 hectares of land here in at Awe local government area of Nasarawa State, with a prospect of growing up to one third of Nigeria's Sugar consumption, which is almost half a million tonnes.

The factory would commence operation in two years time from now, according to president/CEO of Dangote Group, Aliko Dangote, who also told journalists that the company is making a first investment of about N480-N500 million with a production target of 250 million metric tonnes of sugar for a start. He said the company has a potential capacity of creating 150,000 direct and indirect jobs for Nigerians, including those from the host communities.

"It has quite a lot of potential. We will also do power generation and ethanol from sugar. To the state, if this place is up and running, I do not think there will be shortage of power in Nasarawa State. We will be having excess of 90mw of power. It's quite substantial," Dangote said while fielding questions from our correspondent.

He said the focus is not just to make money from the sugar refinery, but boost the Nigerian economy.

We're targeting about half a million tonnes but right now, we're talking about 250 million tonnes and that is worth about N450 billion.

The CBN Governor doesn't only want to support the naira but ensuring jobs are created.

On how much the CBN was committing to the project, Emefiele said "we've not made up our mind on how much we'll put but of course as you heard from Dangote, the project is worth about $500 million. If you convert that to naira, you know how much that is. I know he's going to commit some equities to it. From there, we will determine what is the shortfall and we will come in through intervention through the banks for whatever loan that is required for this.

"Of course, foreign currency will be provided as long as it is for the importation of equipment for the project through the banks for whatever loans that is required for this as long as it is for importation of equipment for the project.

Nasarawa state governor Abdullahi Sule expressed optimism that the project will empower some of the people of the state. He praised the CBN governor and the federal government for their backward integration programme, which he said would help in the diversification of the economy.

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