Border Closure: Nigeria Spent N1.85trn On Food Importation

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The government spent N1.85 trillion on food imports in 2020 after it closed the country’s land borders, the the presidential economic advisory council, Doyin Salami, has said.

Mr Salami disclosed this at the 2021 National Economic Outlook event organised by the Chartered Institute Bankers Nigeria on . The took place virtually.

Nigeria closed its land border in August 2019 the movement goods. The government said it planned curb the smuggling , other commodities and weapons.

“Despite , our national import of food amounted N1.85 trillion between January and September, 2020, a 62 per cent increase when compared the same period in 2019,” Mr Salami was quoted by The Nation as saying.

“This suggests a weakness in our ability to feed ourselves and raises the need to consider review of intervention policies in agriculture.”

According to him, serious climatic concerns are undermining agricultural output with 2.5 million farmers being impacted by flooding in 2019.

“Agriculture continues to decelerate growing at 1.7 per cent year to date while consumer sensitive sectors like manufacturing and distribution continue to contract in double digits,” he said.

“Nigeria’s external imbalances are increasingly precarious with continuing concern over exchange rate differentials.

“By the measure that drives the value of the based on the /dollar inflation differential, the currency should be trading around N439 a dollar at the official market.”

He added that exchange rate convergence, market reflective rates and transparent determination mechanism balance of payment imbalances are large and would remain key questions in 2021.

“The COVID-19 shock of 2020 represents the third major shock to the economy in 12 years,” he said.

“Ahead of the , the economy was contending with a set of pre-existing conditions such as macro instability, stagflation – slow growth and rising inflation, pressure on households – in the form of rising inflation, unemployment, and and pressure on corporate(s) margins – weak consumer and cost pressures,” Mr Salami said.

According to him, and hospitality sectors were gravely affected by the lockdowns in April/May as well as by voluntary containment measures and the imposed restrictions post lockdown.

“A health morphed into an economic resulting in humanitarian and in some cases, security challenges, a global development visiting great disruption to established norms – largely negative short-term impact but some positives – especially with technology deployment, the full impact of which will manifest in the years ahead,” he said.

“The and gas sector, given lower prices, quantity restrictions on Nigeria output and long standing impediments to investment in the sector not to mention the pass through of the sector, the government revenues and forex, to the rest economy is another major driver of recession.”