Through its recent policy, the federal government has banned the importation of tomato paste, powder, or concentrate for retail sales, as well as of preserved tomatoes. It also increased tariff for tomato concentrate, presumably for commercial use from five to 50 per cent in order to revive the tomato sector in addition to $1,500 per metric tonne. Ndubuisi Francis appraises the new policy
TIn the face of the nation’s economic malaise exacerbated by a foreign exchange (FX) crisis, many believe that import substitution is a potent weapon to conserve the badly needed forex. More reliance on locally made goods and services is believed to be an effective way to stimulate economic growth, create jobs and depend less on imported items, a chunk of which are sub-standard.
Nigeria is said to import an average of 150,000 metric tons of tomato concentrate per annum at a staggering value put at $170 million.
It is perhaps in a bid to check the huge capital flight and the pursuit of the Nigeria Industrial Revolution Plan (NIRP), which prioritises agro-allied businesses, an area that the country has comparative advantage that the Ministry of Industry, Trade and Investment (MITI) recently developed a new policy on tomato.
The policy tallies with government’s goal of boosting production, improving the value chain and attracting investment
With the policy, the government set out to stop the importation of tomato paste, powder or concentrate put up for retail sale.
According to the ministry, the tomato sector policy was developed and is being implemented in collaboration with the Federal Ministry of Agriculture and Rural Development, Federal Ministry of Finance, Federal Ministry of Water Resources, Central Bank of Nigeria,
(CBN) Bank of Industry (BoI) and the National Agency for Food and Drugs Administration and Control (NAFDAC).
The policy is imbued with certain specific objectives, including to increase local production of fresh tomato fruit required for fresh consumption and processing; increase local production of tomato concentrate and reduce post-harvest losses.
The unveiling of the tomato policy followed the approval by the Federal Executive Council (FEC) to enable the implementation of certain extraordinary price-based measures aimed at safeguarding Nigeria’s balance of payments in an environment of recession.
The price-based measures include:
Classification of Greenhouse Equipment as agricultural equipment in order to attract 0 per cent import duty, and the stoppage of the importation of tomato paste, powder or concentrate put up for retail sale.
Others are the stoppage of the importation of tomatoes preserved otherwise by vinegar or acetic acid, and increase in the tariff on tomato concentrate to 50 per cent with an additional levy of $1,500 per metric tons.
It also includes the restriction on the importation of tomato concentrate to the seaports to address the abuse of the ECOWAS Trade Liberalisation Scheme (ETLS).
There is also the inclusion of tomato production and processing on the list of industries eligible for investment incentives administered by the Nigeria Investment Promotion Commission (NIPC).
These measures will become effective 30 days after April 7, 2017, when the ECOWAS Secretariat was notified.
Commenting on the tomato policy, the Minister of Industry, Trade and Investment, Dr. Okechukwu Enelamah said: “this new policy is at the core of the Nigeria Industrial Revolution Plan (NIRP), which prioritises agro-allied businesses, an area that we have comparative advantage.
“These measures ultimately, accelerates the growth of the manufacturing industry and deepens diversification.”
Nigeria is said to import an average of 150,000 metric tons of tomato concentrate per annum at a value put at $170 million, mostly due to inadequacy in capacity to produce tomato concentrate. Current demand for fresh tomato fruits is estimated at about 2.45 million metric tons per annum (MTPA) while the country produces only about 1.8 million MTPA.
Despite the supply gap, about 40 per cent of fresh tomato produce is lost due to wastage arising from poor post-harvest handling and inadequate storage.