DEVELOPMENT BULLETIN-NIGERIA: New Policy To Revive Cocoa Industry Underway

By Toye Olori Reprint | | Print |

Toye Olori

AKURE, NIGERIA, Sep 5 1998 (IPS) - Nigeria’s government says it will soon endorse a new policy to revive the West African nation’s ailing cocoa sector.

The policy, drafted by a committee set up by the government four years ago, calls for new prduction, financing and marketing strategies to give the Nigerian cocoa a competitive edge on the world market.

It also encourages the use of cocoa and its by-products for export and domestic consumption.

“The draft policy aims to save the cocoa industry from extinction, and diversify Nigeria’s foreign exchange earnings”, said Akinwale Ojo, chief executive of the Lagos-based Cocoa Association of Nigeria (CAN).

“It will also formulate a stable cocoa policy for the country,” Ojo told IPS this week.

A 27-page report, drafted by the committee, acknowledged that, despite government attempt to reactivate the agricultural sector, the cocoa industry has continued to decline since the late 1960s.

Before the oil boom in the early 1970s, Nigeria’s main foreign exchange earnngs came from the exportation of agricultural produce, with cocoa accounting for more than 60 percent. But with the advent of petroleum, agriculture was relegated to the background.

With the oil glut in the mid-1980s and the falling price of oil, the government embarked on new measures to boost agriculture, providing fertilizer and other farm inputs at subsidised rates to farmers.

But cocoa production in Nigeria has been facing a host of problems. Samuel Orisadare, head of Tree Crops Unit, at the Agricultural Development Project (ADP) here, attributed the decline to ageing plantations, bush burning, construction of roads on plantations, smuggling of cocoa beans an poor management.

For example, Orisadare said 84 percent of the cocoa plantations in Ondo State, which produces 60 percent of Nigeria’s total cocoa output, needs replanting due to old age.

Nigeria’s new cocoa policy has recommended a phased replanting programme to solve the problems of cocoa plantations which have gone past their useful economic lives.

It has also urged farmers to use existing credit facilities from the Nigerian Agricultural and Co-operative Bank and other financial institutions.

It has also called for a liberalised market in a bid to maintain a healthy competition in the local economy and ensure better remuneration for farmers.

“Exporters should be given unimpeded access to continuous working capital through a special window created for the life of the loan to ensure maximisation of installed capacity of processing plants, enhance repayment capacities of beneficiaries and assist the government in meeting its obligations to ADB,” the committee said in its report.

Cocoa trade suffered its worst decline in the late 1980s when prices in the international market slumped to their all-time low, due largely to over-production worldwide.

This led to the adoption in 1993 of a five-year programme, under the auspices of the Fifth Internainal Cocoa Agreement (ICA), to stabilise the situation.