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Governor of the Central Bank of Nigeria, CBN, Godwin Emefiele has bemoaned the current situation in the country’s oil palm industry and expressed the determination of the bank to change the narrative. Underscoring the importance of oil palm as a tree crop with immense economic value, Emefiele noted that its products are important sources of affordable edible and non-edible oils for domestic and industrial uses. He regretted that in spite of this, the Nigerian palm oil industry was at a crossroads, as its further growth and contribution to the national economy continue to be threatened by inadequate local production and continued reliance on imports.
Giving some backgrounds on the recent developments in the oil palm sector in Nigeria, the CBN governor recalled that the journey to revive the oil palm sector began with the discovery that over $500 million of our scarce foreign exchange was being expended on the importation of palm oil to meet identified unmet demand gap of 1.25 million metric tons. He, therefore, called on state governors to help the country through access to land for oil-palm cultivation, in order to reverse the situation. He said under its Oil Palm Development and Expansion Initiative, the CBN had so far disbursed over N30 billion to the oil palm sector which was being painstakingly monitored to ensure efficient and effective utilization and maximum output while oil majors and apex associations were being encouraged to adopt the Out-Grower Scheme to maximize inherent opportunities.
Emefiele spoke in Benin City, Edo State capital Tuesday at the Plantation Owners Forum of Nigeria Oil Palm Discourse – Focus on CBN Smallholder Oil Palm Intervention which also witnessed the launch of Edo State Oil Palm Programme (ESOPP), a N69 billion intervention programme designed to rejuvenate the oil palm sector in the state for global competitiveness. According to Emefiele, “faced with this stark reality, the CBN decided to intervene with a view to changing the narrative and in line with the ambitious attempt to reposition agriculture as the mainstay of the Nigerian economy. Furthermore, in our bid to restore the country’s pre-eminent status as the third global net exporter of palm oil, the Central Bank of Nigeria on 23rd June 2015 included palm oil and palm oil products alongside other commodities in the exclusion list of items not valid for foreign exchange at the Nigerian Foreign Exchange window”. While attributing the dwindling fortune of the industry to myriads of factors that accumulated over the years, most significantly the neglect of the agricultural sector in the wake of the oil boom, Emefiele said this was further exacerbated by the inherent structural deficiencies and potential risks associated with agribusiness in Nigeria. “It is hard to believe that the country’s global market share in palm oil production fell from about 43% in the 1960’s to just about 2% currently”, the CBN Governor lamented.
