Senate: Nigeria Squanders N228.5bn on Sugar Importation

ImageSays 10,000 workers to lose jobs
Omololu Ogunmade
The Senate alleged Wednesday that Nigeria in recent times had squandered almost a whopping sum of N229 billion under the guise of importing sugar into the country.

It also alleged that no fewer than 10,000 workers had lost their jobs as a result of the federal government’s policy, which grants waivers to select importers of raw sugar in the country.

The Red Chamber also insinuated that 10 per cent of government funds which accrued to the Sugar Levy Account had also been diverted by the federal government to irrelevant purposes.

These disclosures were made by Chairman, Senate Committee on Investment, Nenadi Esther Usman, while leading a debate on “A Bill for Act to Amend the National Sugar Development Council Act Cap N78 LFN 2011 and for Other Matters Connected Therewith” Wednesday.

The debate prompted Senate President, Senator David Mark, to describe the federal government’s policy which grants waivers as nothing but a “classical example of policy failure.”

During the debate, Usman said: “The funds in the Sugar Levy Account is a dedicated fund for a specific purpose but over the years, monies have been withdrawn from the account for other purposes not related to sugar sector development.

“These amendments are required to ensure council’s direct access to its funds and prevent the fund’s use for un-intended purposes…Beginning from around 2004, when the first sugar refinery started operating in the country, the mo is accruing to the Sugar Levy Account has witnessed a steady decline. This is due mainly to the fact that most imports now are raw sugar, which currently enjoys waver on the payment of the 10 percent sugar levy…

“Nigeria currently consumes some 1.3 million metric tones of sugar annually but produces only 30 to 50,000 tonnes, which is less than five per cent of its annual consumption.

“The huge supply gaps bridged through imports of sugar, mainly from Brazil. Nigeria spent N53.6 billion, N73 billion and N101.9 billion respectively in 2009, 2010 and 2011 on sugar importation in order to meet the nation’s requirement.

“Over 98.9 per cent of the imports, however, is raw sugar which is refined by the two existing refineries operating in Lagos. In the 80s, at the peak of production by the two local sugar factories (in Bacita and Numan), over 10,000 people were working on the farms and the factories, besides hundreds of outgrower farmers and their families who earned their livelihoods from the factories. Today, the industry employs less than 3,000 people…”

Senators, who spoke during the debate supported the move to amend the bill just as Senator Bassey Otu, argued that “over 10,000 Nigerians can be gainfully employed if the trend is reversed.”

In his remarks, Mark said granting waivers impedes the growth of local industry as he charged the federal government to hand over production of sugar to state governments if it cannot handle it.

His words: “It is a clear case of policy failure. It is wrong to make a policy and on one breath just withdraw that policy and pretend that we don’t know what is happening.

“How can we want to encourage local sugarcane farmers or local sugar production in country and then give a major importer waiver? It means we are not serious about it and nobody can be excused from it because everybody in the government is guilty of it over the years.

“I am more interested because the money in the sugar levy account that nobody knows what is happening to it? It is unacceptable. How can we not know what is happening to billions of naira?

“We are not talking small money here then we again pretend that everything is going on very well…No. I think that this is an area where we must put our foot down on some of the issues. I think Smart is right. It is not everything that is federal government. There are a lot of state governments that can go into sugar production. If everything is left to the federal government then let us dissolve all the states and collapse everything so that there are no states.

“People find excuse to say that the federal government is not doing anything. In all honesty, all the federal government needs to do in agriculture is to provide the enabling environment. And individual farmers would be encouraged at the local and state governments level. Once the policy is right, the encouragement must start at the local government and state level. But every time something goes wrong we point an accusing finger to the federal government.  Of course that person named the federal government has no share in the blame.

“The federal government has some level of blame to share but I think that more of the blame must go to  the local governments and to the state governments. No local government is functioning in this country anyway. Not one. Because they don’t get any allocation. When we talk of unemployment, there is not a single local government that is employing two people in this country. Not one local government because they don’t have the money to do that employment. But we just assume that the federal government is not functioning.”

Tags: Business, Nigeria, Featured, Sugar Importation



Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s