The Nigerian Export-Import Bank (NEXIM) has pledged to assist players in the African cocoa value chain so as to boost processing and improve the export value of the commodity.
The Nigerian Export-Import Bank (NEXIM) has pledged to assist players in the African cocoa value chain so as to boost processing and improve the export value of the commodity.
Abba Bello, managing director of Nigerian Export-Import Bank (NEXIM) made this known while speaking at the 2020 virtual Cocoa Festival themed ‘Transforming the Cocoa Industry for Impact with Focus on African Continental Free Trade Area (AfCFTA)’.
Bello expressed dismay about the situation of cocoa production in Africa, where 75 percent of cocoa is produced – specifically in West Africa and only about 10 percent of the annual global cocoa revenue come to the continent.
According to him, the global cocoa trade is worth about $130billion and Africa is at the least.
“My job as a development banker is to ensure that there is a change to this situation and that Africa gets value for what it produces in the global space,” he said.
“While there are small and medium producers of chocolate or other cocoa products in Africa, they do not make any impact on the value, and part of our responsibility is to change that,” he further said.
“Today, 95 percent of cocoa produced is exported as beans and that makes us (Africa) be at the bottom of the value chain, so we are out of trade, out of processing, out of marketing and advertising and that does not speak well for Africa and indeed job creation and value that comes from the foreign exchange,” he added.
He says in Nigeria – Africa’s biggest economy there is an urgent need for diversification to earn the much crucial foreign exchange.
He stated that the bank had identified the need to build capacity to boost productivity to cushion any effect on oil industry fluctuation.
Speaking further he said NEXIM has identified cocoa as the leading non-oil export produce and that it has financed so much processing capacity within Nigeria.
He added that NEXIM has financed processing facilities in order to move cocoa production forward, stressing that the dismaying part is that all the capacities that were built are almost idle now.
“We have very low productivity, all the equipment have now aged, our farms are aged, production is going down and we are trying to do a lot to change that part, which is revamping these aging plantations, re-tune the processing plants and even upgrade those that are in the sector as traders into processors,” Bello said.
Speaking further Bello stated that NEXIM has partnered with AFRIEXIM bank in providing a $1billion fund under a programme called Nigeria-Africa Trade and Investment Promotion Programme (NATIPP) which is to support AfCFTA.
He says the bank is trying to create a regional and continental cocoa value chain.
Finance is the base of all these, what we are doing at NEXIM is to provide this $1billion to facilitate everything within the value chain that needs to make Africa more competitive in the global value chain for cocoa, he said.
He added that the facility will provide a very low-interest rate, long-term financing, and also provide the opportunity for the continent to grow and better its facility in certification, logistics among others.
Also speaking, Dokun Thompson, the Oloni of Eti-Oni and the chief host said the industry is not really helping farmers.
But believe that the Africa free trade agreement will be opening up Africa and changing the narrative.
Thompson also stated that the Cocoa Research Institute of Nigeria (CRIN) has developed about eight different varieties of cocoa seedlings that are fine flavoured, pest resistant, and also fast yielding and with also good yield result per hectare.
– Businessday