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Nigeria to lose over $160 million to cocoa, cashew exports over COVID-19

Nigeria is projected to lose over $160 million to cocoa and cashew exports in 2020

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Nigeria to lose over $160 million to cocoa, cashew exports over COVID-19

Coronavirus pandemic is expected to cause significant hardship to the non-oil export sector, as Nigeria is projected to lose over $160 million to cocoa and cashew exports in 2020. Agricultural exports like Cocoa, Sesame and Cashew exports are predicted to suffer, due to the pandemic that has lockdown economies of nations across the globe.

This was disclosed by the Nigerian Export Promotion Council in a report, which was seen by Nairametrics, titled Impact assessment of and Policy Responses to the Coronavirus Pandemic on Agricultural Exports: Early evidence from Nigeria.

What it means: A fall in exports of over $100 million is expected in the cocoa sector due to the declining prices, which can be attributed to the falling demand in Europe. Though Sesame exports are likely to prove more resilient due to a smaller decline in prices and more diversified export markets, Cashew exports are expected to shed $60 million. This is expected owing to the Vietnam Cashew Association’s guidance to enterprises within the country to carefully consider before importing raw cashew.

READ ALSO: 2020: CBN eyes $4 billion non-oil revenue 

While other nations had prohibited exports of certain food products, such a move would be practically difficult for Nigeria to make. The reason is simple and that is because the most populous black nation exports Cocoa, cashew and Sesame to cater to foreign demand.
Findings revealed that the exports of the three commodities, in 2018, led to foreign exchange earnings of about $800 million for Nigeria, which means they accounted for over 70% of all agricultural exports. But for the COVID-19 outbreak, the proceeds from the commodities would suffer setbacks by the end of 2020.

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What you need to know: About 280,000 metric tonnes of cocoa beans are produced annually in Nigeria, and about 90% of this exported. That means the impact of the development would be felt more on Cocoa, as it is particularly vulnerable.

It stated, “Over the last decade, cocoa has been the top-performing non-oil export product in Nigeria. Commodity markets have taken a major hit, and this does not apply solely to crude oil. The price of Nigerian cocoa beans stood at $2880.63/tonne on 03 February 2020 (source: ITC market price information). It has now fallen to $2440.94/tonne as of 30 March 2020 (source: ITC market price information). This is a fall of $439.69 per tonne.

“Assuming production stays the same this year, this translates to a loss in export earnings of around $110.8 million across the year. However, if the lockdown in Nigeria in Lagos, FCT and Ogun state, spreads to cocoa producing states such as Ondo and Cross river, then production will evidently fall, generating a further loss in foreign exchange.”

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READ MORE: FG moves to clamp down on tax evaders in mining sector 

Meanwhile, the demand for Nigerian cocoa is at risk of recording a further decline. For instance, Europe remains the epicentre of the COVID-19 pandemic and over 81% of Nigerian cocoa was exported to Europe in 2018, with 65% going to the Netherlands and Germany alone.

Though the price change seen in Sesame seed has not been drastic as cocoa, the value has also dropped by $60 per tonne from $1.270 per tonne to $1,210/tonne.
On its own part, Cashew exports have been on the increase after NEPC targeted the scale-up production in Nigeria. “Production is now around 200,000 metric tonnes, with semi-processing plants common around the country. However, as of 2018, 90.5% of cashew exports were still raw cashew nuts, accounting for over $162 million.

‘For both the raw and semi-processed cashew, the exports go almost entirely to Viet Nam and India. This puts Nigeria at major risk should these two countries choose to limit their imports of raw and semi-processed cashew, due to fears over falling demand for the final product. Indeed, the Standing Committee of the Viet Nam Cashew Association (Vinacas) has warned enterprises in the country to carefully consider before buying raw cashew from West Africa due to implications of the pandemic, It added.

READ ALSO: Nigeria’s cashew nuts exports fall by 74%

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In all, NEPC has shown that the agricultural export sector is at major risk following the COVID-19 pandemic, as the commodities mentioned above and others are expected to witness a lull in 2020. Assuring Nigerians of its commitment, NEPC explained that its efforts in addressing the logistical challenges facing exports currently, as well as promoting diversification of the nation’s agricultural export.

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Abiola has spent about 14 years in journalism. His career has covered some top local print media like TELL Magazine, Broad Street Journal, The Point Newspaper. The Bloomberg MEI alumni has interviewed some of the most influential figures of the IMF, G-20 Summit, Pre-G20 Central Bank Governors and Finance Ministers, Critical Communication World Conference. The multiple award winner is variously trained in business and markets journalism at Lagos Business School, and Pan-Atlantic University. You may contact him via email - [email protected]

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ENDSARS

#EndSARS: Protests may return if panels do not address all issues in 2 weeks – Former Nigerian Minister

Akinyemi says the #EndSARS protesters would return to the streets if their demands are not addressed in two weeks.

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This was disclosed by Professor Bolaji Akinyemi, during a news interview with ARISE TV this afternoon, as he called on the FG to urgently address the issues raised by the protesters, as these issues extend beyond police brutality and the immediate reform of the Nigeria Police force.
He explained during the interview that the current demands of the youths extend beyond basic needs, which remain the core mandate of the present administration.
He likened the #EndSARS protest to the #BlackLivesMatter demonstration and reiterated that demands of the youth extend beyond stomach infrastructure, as it is more of a call for good governance in a bid to address the concrete issues that the country faces.
He called for strategic actions towards combatting the evils of unemployment in Nigeria; called on the military to employ more military men to soak up the unemployment, and also provide security for the country.
On the issue of restructuring, Professor Akinyemi said restructuring is also key to solving the many problems facing the country.
The Professor of Political Science noted that the way forward for Nigeria will be for the government to utilize the Justice Mohammed Uwais report on electoral reforms and the 2014 National Conference report, which he believes addresses the issues confronting Nigerians.
What they are saying
During the interview, Professor Akinyemi said, “I will say and let me believe I am wrong, the judicial panels have just two weeks to address all these issues before the youths come back to the streets. The government should at least give the youths the impression that you have not set up all these panels to buy time, but that you are genuinely and seriously interested in addressing their issues.”
He reiterated the need for the employment of more police officers,
We told the government, because I was part of that conference, that the United Nations said Nigeria needs 1.5 million policemen. We have only about 350,000 and we were recommending that the Nigerian government should employ 750,000 more policemen.”
What we’ve seen in the past two weeks is that we don’t have enough men in uniform to guarantee security in this country if every part of the country decides to blow up. So you serve two purposes – employment and security, and those are things you can do immediately.
“We have just seen how every Governor was scrambling around in the past two weeks; if you allow each state to have its own state police, you wouldn’t have that experience. I have heard of a situation where the streets took over even governance in almost every state. So, restructuring is that you allow things to be done at the local level.”

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Coronavirus

COVID-19: Jason Njoku and wife test positive

iROKOtv CEO and wife have contracted the novel coronavirus.

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Jason Njoku and Wife testes positive to Covid-19

Jason Chukwuma Njoku, the co-founder and CEO of iROKOtv and his wife has tested positive for COVID-19. However, Mrs. Mary Njoku is feeling well.

Jason,  disclosed this via his Twitter handle stating that “My enemies are hard at work in 2020. Mrs. Njoku and I tested positive for Covid-19. I’m not feeling great, but Mary is well. Literally no idea how I caught it. But we shall see this pass too.”

The media mogul did not reveal if his children caught the virus too.

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Business

UK High Commission reopens visa application centres in Nigeria

Days after it was shut down, United Kingdom High Commission in Nigeria has announced the reopening of its visa application centres.

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#EndSARS: We are monitoring developments in Nigeria closely - UK, UK High Commission in Nigeria to replace expired visa for free, as it restarts operations

The United Kingdom High Commission in Nigeria has announced the reopening of its visa application centres in the country.

This comes some days after the high commission had shut down its visa application centres in Victoria Island, Lagos and Abuja over the outbreak of violence arising from hijacked #EndSARS protests against police brutality and extra-judicial killings, which led to the loss of lives, vandalization, and looting of public and private assets across the country.

READ: Reps, NIDO, Ghana government respond to attack on Nigerian residential building

The disclosure was made by the High Commission in a statement through a tweet post on its official Twitter handle.

The High Commission, however, noted in its statement, titled, “Update on UK visa application centres in Nigeria” that its centres would not open on Thursday due to the public holiday in Nigeria, in honour of the Eid-El Malaud celebration.

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The statement from the UK high commission, partly reads, “Our TLS contact visa application centres are now open in Nigeria. Following the recent closures, we are working hard to process all outstanding applications.’’

READ: NCC sets up committee to review licensing framework of Infrastructure Companies

“We thank you for your continued patience and understanding. Please note Thursday, October 29, is a public holiday in Nigeria and our Visa application centres will be closed.

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The reopening of the visa applications centres after they were shut about a week ago is due to the gradual return of peace and order to some of those trouble spots, following the intervention of security agents.

The UK High Commission had been very critical of the outbreak of violence in the country, especially the shooting of unarmed protesters at Lekki Tollgate by alleged military personnel, and asked the government to thoroughly investigate the incident and ensure justice is done.

READ: Buhari gives reason for silence on Lekki Tollgate shooting

In its statement, the High Commission said, “We remain concerned by acts of looting and violence in Nigeria and urge security services use restraint as the order is restored. Working with all stakeholders, judicial panels of inquiry must investigate all incidents, including Lekki and ensure accountability for crimes.”

What you should know

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The Judicial Panel of Inquiry set up by the Lagos state government to handle all cases of police brutality in the state have also been mandated to conduct an inquiry into the shooting of unarmed protesters last week.

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Amnesty International earlier said that 12 people were allegedly shot dead by the police and army at two locations during the hijacked protests.

Explore Data on the Nairametrics Research Website

 

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