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The Sugar Master Plan

With the fall in the price of oil at the international market, it has become imperative that attention be shifted to other sectors. It is in realisation of this fact that the administration of President Muhammadu Buhari has made it a priority to move the country away from a mono-product economy dominated by oil earnings.  Among the critical areas receiving attention are the sectors of agriculture, Trade and Investment.

In particular, the sugar sub-sector is considered as one of the case studies for diversification. An increased local sugar production can be a money-spinner in terms of its high-yielding export value even as the history of the Nigerian sugar sector, from inception, up to the current period, when modest achievements have been made, strengthens arguments in favour of aggressive diversification efforts.

While successive administrations have made conscious efforts to discourage sugar importation by slamming high tariffs on imported sugar, a more conscious move was designed to boost local sugar with the establishment of the National Sugar Development Council (NSDC) in 1993.

To that extent, a sugar levy regime was adopted as one of the responses of government to the report of the expert committee on the development of the sugar industry, which recommended the establishment of an agency to be charged with the responsibility of drawing up “policy guidelines and action programmes on sugar development”. And that agency became the NSDC.

To improve on the local production of a paltry three per cent of domestic needs and also develop a truly vibrant sugar sector in the interest of the economy, the NSDC got approval for the Nigeria Sugar Master Plan (NSMP) in September 2012, and began its implementation on January 1, 2013.

The implementation of the National Sugar Master Plan (NSMP), according to figures from the Ministry of Industry, Trade and Investment, attracted $3 billion pipeline investment into the sugar sector under one year.

The price of sugar (naira/50kg) also fell from N10,370 to N7,003 within the same period, while sugar plantations and refineries were being developed at a fast pace in every region of the country, especially the more vulnerable regions of the North.

Since various companies signed up to the Backward Integration Programme of the Council in 2013, the tune of events in the sub-sector changed for good. For instance, Dangote Sugar Refinery expanded field and factory operations at its BIP site at Savannah Sugar Company, Numan, Adamawa State, with about 6,000 hectares of sugarcane plantation. Golden Sugar Company belonging to Flour Mills of Nigeria Plc also has a new 4,200TCD estate at Sunti Golden Sugar Estate, among others.

As commendable as these efforts are, it is our opinion that the vibrancy being recorded in the sugar sector needs to be sustained and improved upon. For instance, from its inception in 1993 to 2015, a period of 22 years, the Council received a total of N18.57 billion. Between 2013 and 2015, after the approval of the NSMP, and with revised guidelines to aid speedy development of the sector, the NSDC had accessed, via its budgets, a total of N12.5 billion of sugar levy fund. The Council also signed Managed Fund Agreements with both the Bank of Industry (BoI) and Bank of Agriculture (BoA) to create a pool of fund from which sugar investors can access cheap funds.

We observe that there are many other sectors that can be developed as well so as to diversify the economy and place it on a path of sustained growth and development.

 

The post The Sugar Master Plan appeared first on Nigerian News from Leadership News.

This post was syndicated from Nigerian News from Leadership News. Click here to read the full text on the original website.

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