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Covid-19 Palliatives: Implications of looting the strategic grain reserve

Incidences of looting of warehouses have brought to the fore the lack of knowledge of the SGR and the Stockpile of grains kept as a buffer for the nation.

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Covid-19 Palliatives: Implications of looting the strategic grain reserve

Food security has always been an issue for Governments and Policy Makers the World over from the dawn of time.

Food is a basic need of all people and food security is considered a component of National Security especially in the 21st Century. Hence, what to do with surplus food during the season of bountiful harvests and how to manage food in the time of famine is a never ending challenge.

READ: This report explains why Nigerians are bent on leaving the country

READ: Lagos Multi-billion naira rice mill nears completion

In the Bible; the Book of Genesis 41 verses 22-31 and 47 verses 13-27, tell the story of Joseph a young Hebrew Man and how his interpretation of Pharaoh’s dream led to the creation of the first Strategic Grain Reserves in the World.

Joseph’s ideas in ancient Egypt, helped that Civilization survive the onslaught of famine that affected all other Kingdoms and groups of that time and have been replicated in varying formats since then. The basic idea has remained the same though, and this has become an integral part of food security for Nations.

READ: Covid-19: World Bank discloses when Sub-Saharan Africa will fall into recession

A Strategic Grain Reserve (SGR) is a government stockpile of grain for the purpose of meeting future domestic (and sometimes International) needs. Government sets aside a part of the public funds to enable it buy these grains and invests heavily in building giant Silos that are used for proper storage of the grains.

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In addition to their primary function of ensuring the year-round availability of food in the event of emergencies, the SGR can also be used to help in price modulation. If the price of a particular grain becomes too low as to make it economically unviable for Farmers to produce it, the Government comes and mops up the grains so as to drive up the price, and when it becomes too expensive, the government releases from its stockpile to help stabilise the price.

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In Nigeria, the SGRs are located in all the States of the Federation (Silos are at different stages of completion and operation) and the grains are released based on the assessment and advice of relevant departments of government.

The National Agricultural Seed Council (NASC) also conserves seeds for onward distribution to Farmers during the planting seasons. Some of these seeds are kept in Silos, but are not edible and therefore separate from the SGR.

Recent incidences of looting of warehouses all around the Nation, have brought to the fore the importance, dangers and complete lack of knowledge of most Nigerians of the SGR and the Stockpile of grains and seedlings kept as a buffer for the Nation.

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The Government of Ekiti State raised an alarm on Saturday that huge quantities of poisonous items, mistaken for food yet to be distributed as COVID-19 palliatives, were looted in warehouses in Ado-Ekiti on Friday according to Premium Times an Online news medium.

READ: Soybean Futures reach 2-year high, following U.S sales to China 

According to the Paper, the Federal Government’s silos, the ADP warehouse and the State Emergency Management Agency (SEMA) stores, all in Ado- Ekiti, were attacked by hoodlums under the guise of seeking Covid-19 palliatives. Unfortunately, the items carted away were Single Super Phosphate and NPK fertilisers, which they erroneously thought was “Garri’’ (Cassava grains).

Also on Sunday, October 25, 2020, hoodlums broke into the NACS Warehouse in Bukuru, Jos, Plateau State and looted wheat seeds worth millions of Naira. In both instances, Government has appealed to people not to consume these items because they are not fit for human consumption as they have been treated with Agrochemicals and are only suitable for planting.

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Lootings such as these are presently going on in different parts of the nation and the grains so looted would find their way into the Markets and would be sold alongside normal foodstuffs. There is also the prospect of depletion of seeds for the next planting season which was already projected to be hit by floods in some Northern States.

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Concerted efforts must now be made to ensure that no further looting of the SGR is experienced, even as Government intensifies efforts to ensure all the ongoing construction/rehabilitation of Silos is completed, so that the idea behind the establishment of the SGR can be realised.

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    Columnists

    SEC and the proliferation of unregistered investment platforms

    The recent move has generated diverse views from stakeholders with some critics classifying this action as irrational.

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    Reps raise alarm over N200 billion unclaimed dividends in 2020, the Capital market, Lamido Yuguda assumes duty as new DG of Security and Exchange Commission

    According to a circular issued by the Securities and Exchange Commission (SEC), it affirmed its knowledge of the existence of trading platforms that allow investors access to securities listed in other jurisdictions.

    The capital market regulator further reiterated the provisions of sections 67-70 of the Investments and Securities Act (ISA), 2007 and Rules 414 & 415 of the SEC Rules and Regulations which state that only foreign securities listed on any exchange registered in Nigeria may be issued, sold or offered for sale or subscription through approved channels to the Nigerian public.

    The announcement furthers SEC’s quest to strengthen investor protection, promote transparency in the operations of the Nigerian capital market and ensure all investment transactions are within the regulatory purview of the commission.

    READ: Nigeria’s public debt rises to N32.915 trillion as at December 2020

    Recently, the capital market regulator introduced a new requirement for the inclusion of the commission’s contact details in all prospectuses or offer documents issued to the general public in a bid to ascertain the genuineness of such securities. Besides, it is often found that the activities of illegal fund managers become prevalent during a financial or economic downturn, making the public susceptible to the juicy yet unsustainable returns promised by these managers.

    The recent move has generated diverse views from stakeholders with some critics classifying this action as irrational. They cited the impact of investing in foreign stocks on portfolio diversification and the role of Fintechs in driving financial inclusion among others. On the other hand, supporters of this action argued for the need to reduce the pressure on external reserves especially at a time when the green-back is needed to stimulate economic recovery.

    Also, that it helps to safeguard the country’s investing community. We recall that the recent policy by the CBN to close all accounts by Deposit Money Banks (DMBs) and Other Financial Institutions (OFIs) involved in dealing with cryptocurrencies received a lot of backlash from the public.

    READ: Why SEC banned investment technology platforms from offering foreign stocks to Nigerians

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    On this move, however, we opine that it is still within the legal purview of the SEC to discourage investments in foreign listed securities. Nonetheless, we are aware of the concept of globalization in commerce and thus, there might be a need for a rejig of the Investment and Securities Act 2007, and other related acts to capture current trends and developments in the investment globe.

    To avoid backlash going forward, we suggest more public education for clarity with regards to future policy decisions.

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    CSL Stockbrokers Limited, Lagos (CSLS) is a wholly owned subsidiary of FCMB Group Plc and is regulated by the Securities and Exchange Commission, Nigeria. CSLS is a member of the Nigerian Stock Exchange.

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    Columnists

    AfCFTA to promote inclusive trades for women and youth in Africa

    The SMEs and Startup ecosystem in Nigeria which are dominated by women and youths should equally take advantage of these opportunities.

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    Border closure is a threat to forthcoming Lagos Trade Fair - LCCI 

    Inclusive economic development remains one of the core elements of both the African Union’s Agenda 2063 and the United Nations Sustainable Development Goals (SDGs). In furtherance of this, article 3(e) of the AfCFTA main Agreement and article 27(2)(d) of the Protocol on Trade in Services specifically mandate State parties to promote gender equality and “improve the export capacity of both formal and informal service suppliers, with particular attention to micro, small and medium-sized; women and youth service suppliers.

    With over 60 percent of its population being under the age of 25, Africa is regarded as the youngest continent in the world. This presents both challenges and opportunities for the continent. For instance, in Nigeria, the young population has led to attendant social risks as unemployment nears 40% creating a ticking time bomb. The popular saying is that an idle mind is the devil’s workshop.

    On the positive side, however, the young population when properly harnessed will heighten productivity and provide affordable labour which in turn may lead to increase in investment. Nigerian youths just like their counterparts in other African States are known to be very innovative and enterprising. With the right policy and the enabling infrastructures, this energic population can drive the AfCFTA agenda.

    Relatedly, women constitute most of the players in the SMEs ecosystem, accounting for nearly 90% of the labour force in the informal sector. A visit to the popular Balogun market in Lagos Nigeria will attest to this fact. No doubt, regional informal trades amongst women and youth within the ECOWAS region have been going on even before AfCFTA. But the new trade deal is meant to open the door to a population of 1.3 Billion people with a combined GDP of USD2.6 Trillion.

    This is a huge opportunity and further buttresses the need for gender-sensitive and youth-centric implementation that will ensure sustainable and inclusive growth. As noted by a commentator, women and youth traders are less likely to be equipped with the appropriate skills, technology and resources that would enable them to benefit from trade and trade liberalization as they continue to suffer from invisibility, stigmatization, violence, harassment, poor working conditions and lack of recognition for their economic contribution.

    These challenges are made worse by non-tariff barriers such as poor infrastructure, insecurity, lack of access to funds, high unemployment, weak currency, cost of capital, multiple taxations, and other regulatory hurdles.  A clear example of the hurdle being the recent intervention by the agencies of the Federal Government of Nigeria in the areas of FINTECH and Cryptocurrency.

    Just last week, the Securities and Exchange Commission issued a circular advising Capital Market Operators to sever ties with platforms that facilitate access to trading in securities listed in foreign markets. While recognizing the role of the regulators to protect the investing Nigerian public and their assets, however, the interventions have been interpreted by many as capable of sending a wrong signal and acting as disincentives to innovation. Again, this brings to the fore the need for Continental Free Trade that fosters inclusiveness with member States initiating policies that create more opportunities for the youth and women.

    At the webinar held on 29 March 2021 to mark the signing of the MOU on strategic partnership between the AfCFTA Secretariat and the United Nations Development Programme (UNDP), the AfCFTA Secretary-General Mr Wamkele Mene re-echoed the need for inclusiveness in the AfCFTA implementation with the following words:

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    We’ve learnt from other trade agreements in the world. And the lesson to draw is that if a trade agreement neglects the most vulnerable segment of the society, if a trade agreement is perceived to benefit only the multi-national corporations, only the elite, it shall not succeed and it shall not have legitimacy as far as the citizens are concerned. And so that is why I have made it my priority in the implementation of this agreement that there should be shared benefits, there should be shared responsibility with Africans across the length and breadth of the African continent in concrete areas such as affirmative action for women in trade. We are looking at concrete ways in which we can expand the benefit for young people and for women in trade. This is the type of development that we require in order to make this agreement successful. This is the type of development that we require to make sure that the benefits are inclusive.

    This Statement coming from the AfCFTA Secretariat is a clear indication of the aspiration towards gender-balanced and youth-sensitive AfCFTA. However, one is not unmindful of the limited role of the AfCFTA Secretariat in the implementation process.  The actual implementation is done at the national and regional level. And this is not to underestimate the very critical albeit complementary role that the Secretariat plays in this regard.

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    Therefore, the change must start from each member country and percolate through the regional economic blocs and finally to the entire Africa. Nigeria through its agencies such as the Central Bank of Nigeria (assisted by the private sector) can support inclusiveness by providing AfCFTA-focused low-interest financing, training of the SMEs on cross-border trades as well as other incentives to promote the engagement of women and youth in trades on the continent.

    The impact of the COVID-19 pandemic on youth and women-led businesses has widened the economic gap and further impoverished those at the lowest rung on the economic ladder – mostly women and youths. This calls for heightened capacity building in creating new trading and entrepreneurial opportunities for all. With the constant value erosion in the local currency and low-yield environment, entrepreneurs and SMEs in Nigeria can, through cross-border trades, hedge against business risks and equally take advantage of possible arbitrage that exists in different markets within the AfCFTA.

    A shift from the business-as-usual approach on the issue of women and youth is needed under AfCFTA to ensure that the objectives are actualized. Although the AfCFTA is not the magic bullet or the cure for all the economic challenges facing the youths and women in Africa, it is hoped that when fully and equitably implemented, it will go a long way to address some of the factors inhibiting the economic growth of these vulnerable groups.

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    A recent report commissioned by the UNDP and the AfCFTA Secretariat titled “The Futures Report: Making the AfCFTA Work for Women and Youth” which was published in December 2020 has shown that beyond the projections, numbers and negotiations, the realization of the AfCFTA objectives will depend on decisive actions and collective efforts of the African people. Therefore, concrete measures and investment are needed to ensure that women and youths, who account for the majority of the population, business owners and workforce can be better integrated into the value chains, jobs and opportunities available under the AfCFTA.

    As shown by the Report, many entrepreneurs and SMEs across Africa are already taking steps and positioning themselves to benefit from the free trade area and scale their businesses. Some SMEs owners interviewed noted that they are increasing their production lines and sourcing for inter-continental partnership ahead of the progressive implementation of the various phases of the trade regime.

    The SMEs and Startup ecosystem in Nigeria which are dominated by women and youths should equally take advantage of these opportunities. Finally, given that trades in goods and services are fast moving into the digital space, the AfCFTA members States need to invest heavily in digital infrastructures and urgently address the high cost of data in Africa which has made it difficult for the majority of women and youths to access opportunities available online.

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