Food imports gobble up nearly 2 trillion naira
Food imports rise despite CBN boost to increase local production
By Jeph Ajobaju, Editor-in-Chief
Food imports increased by 42% to reach 1,970 billion naira in 2021, above 1,190 billion naira in 2020, a historical level which eclipses the interventions of the Central Bank of Nigeria (CBN) to increase production agriculture and ensuring food security in Africa’s most populous country.
In contrast, Nigeria earned N504.89 billion from agricultural exports in 2021, up to 57% more than N321.54 billion in 2020 and 87% more than N269.83 billion in 2019 .
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This puts the annual agricultural trade balance at a deficit of 1.46 trillion naira, according to figures released by the National Bureau of Statistics (NBS).
Agriculture, the largest sector of the economy, accounted for 25.9% of gross domestic product (GDP) in 2021 with an estimated value of 18.74 trillion naira, but fails to meet local demand, and still less to export earnings.
The sector recorded a growth of 2.13% year-on-year (YoY), lower than 2.17% in 2020.
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The latest statement from the Monetary Police Committee (MPC) of the CBN indicates that the apex bank has intervened in the sectors of manufacturing/industries, agriculture, energy/infrastructure and healthcare, among others, quoted by Nairametry.
Between November and December 2021, the CBN disbursed N75.99 billion to support the cultivation of over 383,000 hectares of maize, rice and wheat under the Acor Borrowers Program (ABP).
This brought cumulative disbursements to N927.94 billion to over 4.5 million smallholder farmers growing 21 commodities across the country.
The CBN has also released N1.76 billion to finance two large-scale agricultural projects under the Credit for Commercial Agriculture Scheme (CACS).
International trade jumped 58% to 39.8 trillion naira in 2021, largely driven by imports worth 20.84 trillion naira; 64% more than N12.7 trillion in 2020. Exports increased by 51% to N18.91 trillion.
The foreign trade deficit increased to N1.94 trillion from N178.3 trillion in 2020.
Crude oil exports increased by 53% to 14.41 trillion naira from 9.44 trillion naira in 2020.
Non-crude oil exports reached N4.49 trillion, 46% higher than N3.08 trillion in 2020.
Nigeria imports large amounts of food every year, in part because of the local supply gap created by terrorism ravaging the North and preventing farmers from farming.
A high import bill without commensurate export returns means a negative trade balance which adds pressure on the Naira exchange rate.
The CBN defends the naira at N416/$1. The parallel market rate is as high as N580/$1.