The Lagos Chamber of Commerce and Industry (LCCI) and the Manufacturers Association of Nigeria (MAN), have kicked against plans by the Central Bank of Nigeri (CBN), to add milk to the list of items banned from accessing its official foreign exchange window.
The two private sector umbrella organisations which expressed their concerns in separate interviews in Lagos on Wednesday said the policy measure was taken without their being consulted.
This is coming as the CBN on July 23, hinted of its intention to add milk and other dairy products to the list of restricted products on the foreign exchange market.
Godwin Emefiele, CBN Governor, who briefed the press after the MPC meeting in Abuja, Tuesday, said that the restriction was to boost local production of dairy products and increase investment in ranches within the country.
He noted that Nigeria currently spends about $1.2 billion to $1.5 billion annually on milk importation.
In his reaction on the impending foreign exchange ban on dairy products, Mr Segun Ajayi-Kadir, Director-General of MAN, said the addition of milk to restricted items would have a negative impact on the economy which might lead to downsizing of staff in the milk producers, reduce government revenues and manufacturing sector’s contribution to GDP.
He lamented that CBN’s decision was taken unilaterally without consultation with operators in the dairy industry.
“It is a fact that backward integration is the way to grow an economy, but there is a need to be strategic and deliberate about the way to implement the measure.
“MAN has always been at the forefront of resource-based industrialisation; and has always supported backward integration. That is the reason many manufacturers are exploring local sourcing of raw materials.
“What CBN wants to achieve is almost the same but the approach and timing differ,” he said.
He warned that the policy could create negative effects from its desired purpose and would escalate smuggling activities into the country.
Ajayi-Kadir stressed the imperative of robust collaboration between the Federal Government and the private sector to boost competitiveness and create enabling environment for businesses especially as Nigeria had signed the African Continental Free Trade Area (AfCFTA) agreement.
Ajayi-Kadir said that MAN would continue to dialogue with the CBN to revisit the policy in the interest of industrial and economic growth.