Economic Potentials Of The Ayade Agricultural And Industrial Revolution (Part 1) BY EMMANUEL ETIM

In Business & Economy, Columnists, Opinion

There is no doubt that the recent visit of the President of Nigeria, Muhammadu Buhari to commission the ultramodern automated rice seedlings and seed factory built by the Cross River State government has put some spotlight on the development initiatives of the Ayade’s administration.

In the light of this, our intention is to seize the moment to further highlight the economic potentials of the agricultural and industrial revolution going on in the state, as they relate to job and wealth creation, revenue generation and many others.

In the words of the president, and I quote “I am happy that Governor Ayade keyed into that policy (zero-oil economic roadmap) and has today become one of the reference points in our agricultural revolution effort.” The truth is that Ayade is not just a reference point in agricultural revolution but also a reference point in industrial revolution in Nigeria.

To buttress this point, the president in his speech said: “With Governor Ayade’s other investments in agriculture such as the ongoing construction of an ultra-modern Rice Mill in Ogoja, the Cotton Farm in Yala, the Cocoa Processing Plant in Ikom and the Banana Plantation in Odukpani, the feed Mill and Yellow Maize Farm in Obubra as well as the ultra-modern poultry farm for export of frozen chicken amongst others, it is clear that Cross River has found a pathway to ease itself from over reliance on federal allocation.”

The president added: “It is evident also that by conceiving projects such as these, Governor Ayade has a keen eye for tomorrow; focusing on projects that are building a new economic base for the state rather than projects with short term benefits for the purpose of making cheap political gains. I sincerely commend Your Excellency’s vision.”

These massive agricultural and industrial investments in Cross River State have the potentials to bring Cross River State out of economic stagnation into economic prosperity within the next few years if we stay on course. The focus of this treatise is to carefully consider these agricultural and industrial investments and highlight some of the figures that led to the investment decisions and the expected economic gains including revenue generation, job creation and many more.

Let me begin with the investment in rice production and processing in the state. The Cross River State Rice seedling and seed factory recently commissioned by the President Muhammadu Buhari is conceived to meet the growing demand for the product in Nigeria. Though the factory is the first and biggest in Africa, it can hardly meet the demand for the product in the country. The state however estimates to make about N70 billion annually from the seeds and seedlings supply.

The state is also currently building its ultrmodern vitaminised rice mill in Ogoja. The factory is more than 80 percent completed with machines already in the state and being installed. According to Index Mundi the total domestic milled rice consumption in Nigeria in 2017 was 6.7 million metric tonnes and is expected to reach 6.9 million metric tonnes in 2018 showing a growth rate of 2.99 percent.

The prevailing market price for rice in Nigeria is about N300,000 per metric tonne. With a demand of about 7 million metric tonnes, the annual turnover nationally is about N2.1 trillion. With the state targetting just about 5 percent of this market share, the state would earn about NGN100 billion from milled rice annually.

Beyond eevenue generation, the investments in the rice value chain from the rice seedlings and seed factory to the ultramodern rice mill will generate 5000 direct jobs and more than 20,000 indirect jobs. The state, with the completion of the seedlings and seed factory and the mill will push in the direction of production which is expected to create most of the jobs. These opportunities will take a lot of our youths off the streets.

Next, let us consider the Calabar Pharmaceutical Company. The size of pharmaceutical industry in Nigeria as at 2013 was put at about $1.28billion according to the World Bank. In 2014, the PwC Parma Report 2020 report stated that the pharmaceutical market was anticipated to more than double to US$1.3 trillion globally by 2020.

Presently about 70 per cent of drugs used in Nigeria are imported. Local production thus stands at about 30 per cent. The Federal Government of Nigeria has thus put a total prohibition on the importation of pharmaceutical products under the 2016 Fiscal Policy Measures but special permission is granted to local manufacturers who have to pay 20 percent duty for imports.

It is expected that Calarpharm through the production of quality pharmaceutical products including drugs and vaccines will seize a good part of this market share. The company when fully operational and taking a modest 5 percent of the market share in Nigeria by 2020 will be earning revenue to the tune of about N50 billion per annum.

The Calabar Pharmaceutical Company is already creating jobs with the recent advertising of available vacancies in the national dailies. It is expected that the company will create not less than 1000 direct and indirect jobs. Beyond revenue generation and job creation, the investment is expected to contribute to improved health outcomes in the state. Health they say, is wealth.

And now, let us take a look at the newly completed toothpick factory in Yakurr, in Cross River State. As at the end of 2009, the total annual importation of toothpicks ran into about N800 million. The Federal Government as part of the efforts to encourage local production and save foreign exchange, banned the importation of toothpick into the country in the last decade.

The Ekori Toothpick Factory has quality machines that will produce up to about 10,000kg toothpicks daily. With the present demand of the product in Nigeria and neighbouring countries, the factory is expected to make about N10 billion annually. The factory will employ atleast 50 workers directly and more than 500 people indirectly.

The industry will thus be of a great benefit to the state economy by creating jobs for the citizens, generating revenue to the government through taxes and generating foreign exchange from export.

These are just a few of many factories ongoing in the Senator Ben Ayade industrial and agricultural revolution agenda. In the second part of this treatise we will consider other projects including Cocoa Processing Factory in Ikom, Cross River State Garment factory, Yellow Maize Farm and feedmlil in Obubra and many more.

Emmanuel Etim is SSA to Governor Ayade of Cross River State on Creative and Knowledge Economy.

NOTE:Opinions expressed in this article are strictly attributable to the author, Emmanuel Etim, and do not represent the opinion of CrossRiverWatch or any other organization the author works for/with.

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