Of Rice Business And Its Many ‘Ghost Investors’

Recently, the Independent Corrupt Practices and other related offences Commission revealed that there were over 40,000 “ghost workers” in the federal ministries. It explained that this action had denied the country over N100bn. Evidently, the rice sub-sector has its fair share of ghosts. These “ghost investors” are mostly rice traders who surface whenever rice quota allocation is announced, claiming to be investors, though they have no visible paddy or mill in Nigeria. In effect, the quota system meant for existing investments in the domestic rice sector ends up abused. The 2014 quota allocation is a quick reference.
With the new government underlining agriculture as a major area of interest, there may be a need to examine the various value inputs of companies on the quota list, and their contributions to rice self-sufficiency in Nigeria.
It is essential that it begins to implement allocations commensurate with contributions made to domestic rice production. It is imperative also that President Muhammadu Buhari deals with the issue of merchants who have no stake in the rice business. Though it has not made known if it would continue the Agricultural Transformation Agenda of the previous administration, this government has emphasised that it hopes to open up newer revenues for the country through agriculture.
Bags-of-riceThe immediate past Minister of Agriculture, Dr Akinwumi Adesina, expressed that the goal of the country was for self-sufficiency in rice production. Part of the attempts at reaching this objective was to place a quota allocation system as an incentive to investors making credible investments in the rice business.
The quota allocation would cushion their financial commitments in the rice value chain. The sequel to this information was a controversy which attracted the nation to this policy, as one that lacked transparency, and offered preference to traders over investors. A certain newspaper even recently reported about some quota allocations which were hastily created by the Goodluck Jonathan government to create avenues for one of these new companies.
One thing the 2014 rice quota saga offered to Nigerians was a revelation of the many deficiencies in the sub-sector. It also made it very obvious to Nigerians that the trouble with the continued failure of meeting the self-sufficiency target was influenced by these companies who partner some government agencies like the Nigerian Customs Service, and highly placed government officials to impede real investors an avenue to expand their investments in the local production of rice.
On the foreground, it is certain that Nigeria is a country of strong economic potential that can affect Africa, and the world. It will however need an industrial revolution. Many economic observers believe that agriculture may be the right place to start at this time, with the depleting oil reserves. The potential of an industrialised agricultural economy is so enormous; that Nigeria at this time is comparable to an untapped palm tree brimming with juice.
Narrowing down to the rice sub-sector as an example of these possibilities, several past governments have made efforts to encourage local food production that would meet the rice demand gap.
Agricultural policies such as the Operation Feed the Nation (1976 -1979), Green Revolution (1980) and the most recent from the last government, Agricultural Transformation Agenda meant to place agriculture outside the context of being a development issue, to being business. The inconsistency of these policies has been a major problem, and each time, rice importation becomes a platform to leap into a definite timeline for self-sufficiency, it fails. This is as a result of some unpatriotic individuals who partner importers, and in the process deny sincere foreign investors and local businesses a true stake that makes policy implementation difficult.
The 2014 quota allocation used for rice importation proved that a continued application of nepotism may not lead the country to the self-sufficiency it desires. One of which is the general idea of granting investors—not rice merchants, or importers, who hurriedly create companies to meet quota demands—a leverage to balance their heavy investments in the sub-sector.
The new government appears to be making efforts to attract foreign investment into the country. It should therefore push a front where foreign investors and local businesses can work towards the envisaged self-sufficiency. This is by ensuring recognisable and transparent allocations and perhaps call for a review of the 2015 quota, to dismiss, “ghost investors”–created to evade duties, or deny those making true contribution in the rice food value chain a place.

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