The Central Bank of Nigeria (CBN), Deputy Governor, Operations, Mr. Folashodun Shonubi Thursday warned that the country’s agricultural exports are vulnerable to external shocks, and called for the development of the commodities’ value chain through value addition.
He said the country currently lacked control over demand and supply of export commodities, thereby exposing it to the dictates of external forces.
“But again, if we are to export just cocoa, it is still vulnerable to external shocks and we don’t have control over demand; we don’t have control over supply.
“In 2014 for instance, Africa earned about $2.4 billion exporting coffee to Europe while Germany alone earned about $3.8 billion exporting Africa’s coffee. And what is the difference? Value addition.”
Speaking during a web conference on “Financing Agribusiness Post-COVID-19: Opportunities, Threats and Options” which was organised by the Nigerian-British Chamber of Commerce, he said while it is good to diversify the economy into agriculture and pursue primary production, value addition remained the cash cow for the sector.
He said diversification into grains and other staples presented a strong potential to widening government’s revenue base as domestic food demand is expected to increase to cover consumption and raw materials for industries.
Represented by CBN’s Deputy Director, Development Finance Department, Mr. Osita Nwanisobi, Shonubi said beyond production, there are enormous opportunities across the value chain in manufacturing of agricultural inputs, agro-tech initiatives, on-farm and secondary domestic processing, livestock and poultry processing, commodity trading, transportation and market research.
He said the growing momentum in the demand for foodstuff and raw materials by households and businesses as well as the growing restrictions on food export by countries, presented an opportunity for the country to start to look inwards to guarantee food security and availability of raw materials for domestic industries.