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CBN maize import ban ill-timed, may cripple poultry sector – University Don

The University Don stated that the apex bank’s decision to ban maize importation was too abrupt.

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Godwin Emefiele, CBN expands scope of regional banks in Nigeria, gives compliance timeframe

The recent directive by the Central Bank of Nigeria, banning the importation of maize, has been described as ill-timed, with potential negative consequences for Nigeria’s poultry sector. The apex bank had on July 13 restricted access for importation of maize through the official CBN forex window. It hinged its decision on the need ‘to increase local production, stimulate a rapid economic recovery, safeguard rural livelihoods and increase jobs which were lost as a result of the ongoing COVID-19 pandemic.’

However, Dr. Ikechukwu Kelikume, the Programme Director of the Lagos Business School Agribusiness programme, stated that the policy could further compound the woes of poultry farmers given that maize, which constitutes over 50 per cent of poultry feed content is currently very scarce, and where available, is very expensive, even as the price keeps rising.

READ ALSO: CBN to support maize farmers, projects 12.5 million metric tons in 18 months

Although admitting that the CBN’s earlier policies of Agric, Small and Medium enterprise scheme and the Anchor Borrowers Programme have been largely successful, he opined that the current decision to discontinue the processing of Form M for the importation of Maize could reverse the gains of those interventions.

On the consequences of the CBN directive, Kelikume said: “The situation spells doom for poultry farmers across the country who are beginning to cut down on production because of the high cost of feed and imported medication for the birds. A negative spillover effect of the high cost of feed is the scarcity of eggs and a consequent rise in its price across the country. The implications of the current challenges in the maize value chain are that the gains of employing more people in the agricultural sector will be rolled back in the coming months.”

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READ ALSO: Farmcrowdy launches new 7,500 acres for rice and maize farms

He added: “As it stands, there is no alternative for the poultry farmers, as the poultry sector will face a catastrophic shortage of feeds, a critical input in their business. This situation will render tens of thousands of them unemployed and undo all the gains made by this sector in the past five years. Thousands of poultry businesses will shut down in the face of high operating costs, leaving business owners and their employees without a means of livelihood.”

The University Don stated that the apex bank’s decision to ban maize importation was too abrupt, urging the CBN to reverse the decision. “As a matter of necessity, the CBN’s decision to discontinue the processing of Form M for the importation of Maize/Corn must be revisited. It is expedient at this time for the Central Bank to allow importers of Maize to import it through the CBN Foreign exchange window, to close the gap in maize shortage while preparing for a phased discontinuation of maize importation in the country,” he said.

READ MORE: CBN restricts forex for milk import to Nestle, Chi, Friesland, 3 others

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He estimates the current shortfall in the maize value chain to be around 100,000 metric tons, which translates to an import bill of less than $20 million, describing that as a negligible import burden, even in the current tight foreign exchange situation, and a small price to pay to salvage the poultry sector.

READ ALSO: Poultry farmers beg President Buhari not to reopen borders

The LBS Agribusiness Programme Director further counselled: “The time to act is now. The government must put its mechanism in place to import Maize into the country as a temporary measure to plug the pending scarcity that is imminent in the last quarter of the year 2020. Nigeria has a high production potential for maize. Notwithstanding, the current challenge is that the production and supply bottlenecks in the sector have first to be checkmated for any meaningful import restriction measure to be effective.”

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1 Comment

1 Comment

  1. Mlm Wane

    July 21, 2020 at 7:11 am

    The poultry farmer’s have been giving the same reason for the past twenty years that there is no enough maize produced in the country. What a shame that with vast arable land and over 200 people we import rice, wheat, maize to feed our people. If we cannot grow enough maize to feed our chicken to produce eggs, let the prices of eggs skyrocket to force us produce produce maize locally.Nigeria cannot afford to remain underdeveloped because we spend our scarce foreign currencies thoughtlessly through importation of most items we can produce. We must use our scarce foreign currencies to import machinery to industrialize our economy and provide jobs for our youths instead of supporting flamboyant lifestyles of most industrialists who manipulate our foreign exchange system to make money at the expense of local production.

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Corporate Press Releases

Tizeti rolls out high-speed 4G LTE in Edo with N4000/month broadband service

Tizeti is rolling out its 4G LTE network in Edo State, with monthly fixed broadband costs pegged at four thousand Naira ($8).

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As part of its commitment to ensuring access to affordable broadband connectivity in Africa’s underserved populations, Tizeti, West Africa’s pioneer solar-based internet service provider is rolling out its 4G LTE network in Edo State, with monthly fixed broadband costs pegged at four thousand Naira ($8). With this move, millions of people in Edo State previously outside the broadband envelope can now take advantage of high-speed broadband internet from Tizeti.

READ: Facebook, MainOne romance to birth high speed internet for Ogun and Edo

Announcing the rollout of its new low-cost unlimited 4G services in Edo, the Chief Executive Officer of Tizeti, Kendall Ananyi, said that this 4G broadband internet will empower more Nigerians in Edo State, stimulate economic activities and provide unlimited access to affordable and reliable broadband services as well as complement the Edo State Government’s efforts in driving investment promotion and building a robust technology ecosystem in the state.

READ: Tizeti, MainOne extend partnership to expand highspeed WiFi services in Africa 

“Rolling out 4G LTE broadband internet in Edo at the cheapest fixed broadband prices in Nigeria, and possibly Africa, is a strategic decision for us. We have been building brand-new, solar-powered, 4G-capable towers in Edo, starting with Benin City, which leverages Edo State’s expansive fiber-network built by some of our partners, MainOne and Facebook. Edo State has a large population of vibrant, young people and a high number of higher institutions, which provides a foundation for a robust and thriving ecosystem to enable digital leadership. And the Edo State Governor, Mr. Godwin Obaseki, is implementing reforms in investment promotion and determination to build a robust technology ecosystem in the state, with an agenda that prioritizes Information Communication Technology (ICT)-compliant pedagogy in primary schools, improves digital skills for students and graduates and revamps technical education to increase productivity. This has created a perfect environment for us to roll out our low-cost broadband service, starting in Edo State, but with plans to expand across the country over the next few months,” Ananyi said.

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READ: ipNX and USTDA sign deal to develop Nigeria’s ICT infrastructure.

Corroborating Ananyi, Tizeti’s Chief Operating Officer, Ifeanyi Okonkwo, states, “The launch in Edo State is personal to us as founders of Tizeti because we are alumni of the University of Benin. At 4,000 Naira monthly costs with a one-off installation cost of 4,000 Naira, we believe the plan is affordable, especially to undergraduate students. This provides a huge opportunity for people in Edo to benefit from unlimited broadband internet for use in online learning, eCommerce and entertainment, especially interactive games, video consumption, and music”.

Interested users in  Edo State can pre-sign up at https://wifi.com.ng/edostate/; installations are expected to commence in Benin City on April 1st, 2021.

READ; Orange launches high speed internet network in Nigeria, Ghana, and 6 others

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For many countries in Africa, there is still a huge digital divide. This boundary between connected and unconnected translates into clear consequences for employment, education, family and social life, and access to information. According to the World Wide Web Foundation, ensuring fast internet in Africa will enable billions more to come online, and to take advantage of the life-changing socio-economic opportunities that access to the Internet provides. Companies like Tizeti are playing a significant role in addressing the digital infrastructure deficits in Africa with innovative technology and capabilities, to improve development outcomes for millions of people.

Tizeti currently has 1.7 million unique users, with broadband services which include a new Skype-like personal and business enterprise communications service — WiFiCall.ng, and access to video streaming sites and services.

About Tizeti

Tizeti is a fast-growing Wireless Internet service provider in Lagos, Nigeria, delivering high-speed unlimited Wi-Fi Internet access to residential and business customers using wide-area Wi-Fi. Its services are available in Lagos, Ogun, and Rivers State. It is also expanding rapidly to other African countries as it has been successfully launched in Accra and Tema, Ghana.

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Kinyungu Ventures Research calls for changes to cut-and-paste VC strategy in Africa

The Paper recommends investment structures and approaches tailored to African operating conditions.

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East African venture advisory firm, Kinyungu Ventures has published a white paper Chasing Outliers: Why Context Matters for Early Stage Investing in Africa that has found that there continues to be a wide misalignment between traditional venture capital models and the African market. The team behind the report is now calling for a broadening of approaches to institutional investment on the continent. Speaking with 100 Pan-African founders, investors, and LPs across 15 African countries, the research suggests investors should prioritize investing structures and practices that reflect the realities of operating in Africa. This includes adopting more flexible investing structures with longer time horizons.

According to the paper, there are multiple mismatches between key characteristics of Silicon Valley VC and African markets, which influence how startups and funds maneuver as well as what results they expect and produce. Findings show that African markets are large, but also fragmented, and its consumers have limited purchasing power. Furthermore, consumers on the continent are difficult to acquire and retain, yet the sheer size of the African market also presents a real opportunity for profit once the environment is clearly understood. The paper’s key recommendations for funds include:

  • Adopting more focused investment strategies, such as investing in b2b companies or cross-subsidizing a portfolio with less risky, steady return assets.
  • Considering non-unicorn investing models geared at more resilient companies, with returns distributed more widely across the portfolio
  • Using flexible structures such as debt or PCVs to accommodate market-level changes, where feasible
  • Allowing a longer time horizon for returns, understanding that growth could be slow and difficult to achieve for many companies

Kinyungu Ventures catalyzes resilient businesses for local intergenerational prosperity. The East African-centric investor focuses on entrepreneurship in East Africa, startups, seed funding, debt financing, impact investing and angel investing.

Speaking on the launch of the white paper, Tony Chen, Managing Director of Kinyungu Ventures and co-publisher of the report says, “Capital in Africa is scarce and pursuing a “growth at all costs” strategy where capital pools are shallow presents huge risks for companies. We’ve also found that many great businesses don’t fit the typical VC profile, but have tremendous unfulfilled potential”.

Tayo Akinyemi, lead researcher and writer of the report added: “In our conversations with numerous investors and founders, it is clear that nuances in variables such as consumer behavior, cultural norms, and business practices impact startups significantly and being on the ground is crucial for success. While African markets aren’t always able to provide the outsized returns that Silicon Valley typically looks for in high-growth companies, a more focused strategy here could unlock real gems, as has been proven by some of the startup successes the continent has seen over the years.”

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Global Credit Rating reaffirms Sovereign Trust Insurance Plc ‘A-‘rating

Global Credit Rating Limited has reaffirmed an A-rating for Sovereign Trust Insurance Plc.

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Sovereign Trust Insurance blames IT failure for delaying its 2019 financial statement

Global Credit Rating Limited, an international rating agency, has reaffirmed an A-rating for Sovereign Trust Insurance Plc.

According to a press release signed by the firm’s Deputy General Manager, Olusegun Bankole, and seen by Nairametrics, the insurance firm has consistently maintained its rating for over a decade now.

The key drivers that helped in the reaffirmation of the A-rating by the firm are;

  • Consistency in paying her claims obligations over the years, as captured in an earlier solvency and operational report for financial institutions in Nigeria and other allied businesses, released by the rating agency in December 2020.
  • Listing of rights issue in 2019 which helped to increase the shareholders’ funds of the company to N8.2 billion as at Q3 2020, up by 31% Year-on-Year. This played a catalyst role in maintaining the A-rating status of the firm.
  • The capital adequacy of the firm was also pivotal.

According to the information available on the website of the rating agency, the A-rating reflects high claims-paying ability, strong protection factors, modest risk which may vary over time due to economic and/or underwriting conditions.

This fact was buttressed by a section in the press release which reads:

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  • Sovereign Trust Insurance Plc has great potentials for growth in the years ahead, considering some of the strategies that have been put in place to propel its operations. Global Credit Rating noted that the company has shown a great deal of consistency in her claims obligations to her numerous customers spread all over the country.”

About Global Credit Rating Limited

  • Global Credit Rating Co (Pty) Ltd (GCR) operates as a credit rating services provider. The Company ratings for banks, financial institutions, insurance, corporate and public sector debt, and structured finance serves customers worldwide.

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