Rice Smuggling Intensifies as Yuletide Beckons

11 Dec 2012

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Bags of rice

Crusoe Osagie
Despite the persistent outcry of genuine rice millers, smugglers of the product have intensified their illicit business ahead of the holiday season, undercutting both the genuine millers and costing the federal government huge sums of money in lost revenue.

Investigations show that because Nigeria ’s land borders still remain porous, the smugglers have capitalised on this, flooding the country with smuggled rice, a few weeks to the Christmas festivities when the price of the commodity is expected to rise higher.
This development is causing great concern within rice circles in the country, especially among genuine millers of the product who have made huge investments in the business.

The millers under the aegis of the Rice Millers, Importers  and Distributors Association of Nigeria (RiMIDAN), put the total loss of revenue to the government from smuggling for the period commencing January 2012 till date at N32 billion.

This figure is expected to rise if nothing is done to check the smugglers.
The association’s Chairman, Tunji Owoeye (FCA) reiterated this position when he spoke with journalists, saying the multi-million naira worth of investments by his members might go into the drains, while it would also put the food security plans of the federal government at threat.

Providing a background to the sector’s operations, he said although the national yearly consumption of rice was about 5.5million metric tonnes, local production accounts for about 1.8million tonnes, leaving a substantial percentage of the nation’s rice need to be met through importation.

But while the association’s members are making diligent efforts to ensure rice availability at affordable price, the smugglers are threatening it.

He told THISDAY: “The truth is that the problem of smuggling is getting more serious by the day. Because the borders are porous, and because the smugglers have not been decisively tackled, the trade has continued to thrive. The truth is that it is threatening the food security plans of the federal government while also jeopardising the businesses of our members”.

Owoeye said more jobs would be created, more revenue would accrue to the federal government, and the total food value chain would be impacted positively if the issue of rice smuggling is effectively tackled”.
He recalled that the Federal Government on July, 2012, introduced 20 per cent and 25 per cent increased levies on imported polished rice and husked brown rice respectively, with the aim of encouraging home-grown rice and discouraging importation, saying this was a welcome development.

The same is true of the complete ban on the importation of rice through land borders to ensure that the expected gains from the increase in levy and the subsequent investment in the development of Nigerian grown rice are not eroded by the activities of land border Smugglers.”

“The quantum of rice being smuggled through land from the Republic of Benin is increasing on a daily basis. An estimated 30,000 metric tonnes of rice is being smuggled on a monthly basis into Nigeria . When we raised these issues with the authorities, we alerted them that over 140,000 metric tonnes of parboiled rice was scheduled to arrive at the ports of the neighboring country!”

RIMIDAN members said they collectively employed about 4.5million, and have investments in Plants, Machinery and Equipment of no less than N100 billion as at mid-2012 adding that they were equally investing heavily in corporate social responsibility, in the areas of repair of local roads, building of bridges in their area of operation as well as the development & management of recreational parks in various parts of the country.

“The above facts and statistics go to show that RiMIDAN is indeed a major stakeholder in the agricultural and by extension, economic sectors of this country hence our concern that some want to reap where they did not sow, without considering the impact of this on the generality of Nigerians. We do not want a situation where the sector would be destroyed by economic and national saboteurs”, he said.

Tags: Business, Nigeria, Featured, Rice Smuggling, Yuletide

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