VEOPAN Demands FG’s Enforcement of Existing Laws Against Vegetable Oil Smuggling

Amby Uneze in Owerri

The Vegetable/Edible Oil Producers Association of Nigeria (VEOPAN) has appealed to the federal government to implement stricter enforcement against smugglers of vegetable and edible oil in order to give local producers a breather and grow the sub-sector.

National Chairman of VEOPAN, Chief Okey Ikoro, while briefing journalists in Owerri, lamented the scourge associated with the continued flooding of Nigerian markets with smuggled products thereby undermining local producers, killing jobs, and sabotaging the country’s industrial growth agenda, despite clear government policy restricting refined vegetable oil imports.

Ikoro expressed displeasure at the level of implementation of the policy by relevant government agencies including NAFDAC, SON, Customs, etc, adding that if stricter border enforcement, improved coordination, market surveillance, support for local refining could be activated, the country would benefit immensely from the local producers.

According to him, the smuggled oil are unbranded, so no one can trace their origin, expiry dates, saying these make it risky for human consumption.

“We think that the government should mandate Customs, NAFDAC, SON, etc to regulate and enforce this policy. We are not asking for subsidies, but enabling environment, protecting the laws already made and enforcing them so that the sector can survive.

 “The basic thing is that refined vegetable oil is under prohibition. We should respect the law because all the projections or plans by the sector were based on this prohibition.

“All the money borrowed for backward integration for oil plantation were based on this prohibition. If you smuggle something into a country, you are not paying VAT, no duty payment, so there is no way it cannot be cheaper.

 “Moreover, the smuggled oil does not pass through due process, nobody knows it’s content, because NAFDAC is not involved. For us, we go into extra pains to fortify our oil with Vitamin A. Nobody has checked the quality or value of the oil being smuggled into the country. But our stand is that when the government makes a law, they protect it,” he stressed.

He wondered how the government would make law and at the same time allow some unscrupulous people  to undermine it, adding that at every Wharf or Port, Custom, NAFDAC, SON and other agencies are there, and these agencies cannot pretend that they do not know.

 Ikoro, who is a national productivity award winner (NPOM), added, “all these things jeopardise the health of our people, since nobody can guarantee its genuineness, therefore we expect NAFDAC enforcement to go into action.

“That is our position. Nigeria has enough installed capacity to service the demands. Right now most of the companies are running at 40 percent install capacity because of losses they are incurring through all these sudden surge in bringing oil.

 “Once that ship berths, they cross the border and push into the market, the price would be affected. Look at the environment we are operating in. Industries are on Band A in Nigeria, the only country industries are placed on the highest band of electricity tariff while other countries are subsidising the industries in their environment, in order to make sure that the products are cheap.

“Nigeria is placing industries on the highest band of electricity tariff. Here we pay N30 to N40 million a month on electricity. It is damming, such would translate into price of products. There is no way we can compare with a country that subsidises everything.

 “We cannot compete, it is impossible where they have full electricity, and industries are encouraged to produce more, while the access is exported to countries like Nigeria without proper documentation and inspection.

“In Asia, for instance, it produced about 10 million tons last year when Nigeria produced 1.5million tons. This is because there is encouragement there while there is no encouragement here.

 “We urge the government to look at subsidising industries, including electricity tariff. For example, a trailer to transport oil from Owerri to Kano, for instance, you pay about N3m, it is translated into the cost. Elsewhere there are railroads that carry these but here in Nigeria, it is not so.

“Again, there are no proper agricultural funds for backward integration to grow in the sector. The commercial banks are charging 34 percent on interest rate today, no intervention funds because intervention funds come below five percent for us to do backward integration, create more plantations, build more factories, but the intensive atmosphere is not conducive, no long term planning.

“Government should try to implement policy consistency, create an intervention fund at five percent so that industries can survive and plan,” he added.