05/01/2009 (Allafrica) - The Plantation Owners Forum of Nigeria (POFON) has decried the recent plan of the Federal Government to lift the ban on importation of palm oil and other related products as well as approve massive importation of such commodities.

A statement from Mr. Fatai Afolabi, POFON's executive secretary, indicated that a new lifting of the ban, which has been in place for about five years, would have a devastating effect on the investment of those who are involved in local prouduction.

Mr. Afolabi pointed out that "this policy reversal has come without consultation with stakeholders and has brought back to the fore the critical and recurring issue of policy inconsistency as an albatross to the development of our agricultural sector."

According to him, "it is with the deepest concern and utmost displeasure that we received the news of the lifting of the ban on the importation of vegetable oil among other food items whose importation has been banned in the last five years."

He explained that the new tariff regime has replaced the existing ban on the importation of vegetable oil with 35 per cent import duty for the period of 2008 to 2012 for palm oil and its fractions whether or not refined, but not chemically modified; and soybean oil or groundnut oil and its fraction.

The implications, according to Afolabi, are that "this development has already depressed the local vegetable oil industry and the effect on the future of oil palm and other oil seeds is extremely untoward." Moreover, "the current investment in oil palm would become unprofitable, plantation owners will hold back on planned expansion in plantation and milling facilities."

"The whole stretch of the oil palm belt (spanning 24 states)," Afolabi continued, "will experience serious unemployment in their respective rural communities" as "thousands of direct employment will be lost with a multiplier effect on millions of dependants, suppliers and contractors. Rural employment will result in degradation of natural resources and accelerate rural-urban migration."

Afolabi pointed out that, with this decision of the government, "the vision 20/2020 will be considerably threatened."

Afolabi recalled that evidences abound "that the oil palm industry has witnessed phenomenal growth in the last six years, occasioned by the total ban of 2002. Evidences abound also that the periods of marginal growth in the vegetable oil sub-sector in the past coincided with the period of import ban on vegetable oil."

He suggested that the policy reversal of palm oil importation be addressed as a coalition in the NESG's Agric and Food Policy Commission. Describing the tariff change as "least protective," Afolabi stated that "a policy change that is not farmer-friendly and that does not put the least smile on the faces of patriotic Nigerians and foreign investors in primary production cannot, and should not, stand."

Afolabi statement made available to Vanguard a copy of an earlier letter to the Minister of Agriculture, in which POFON complained about smuggling of vegetable oil into the country, while the ban was still in place. According to the letter, "this development has already depressed the local vegetable oil industry and the effect on the future of oil palm development vis-vis the Vegetable Oil Development Programme (VODEP) of the government is extremely untoward."

He therefore urged that "the way forward to achieving steady growth in the oil palm industry in particular, and the agricultural sector in general, is for the recent lifting of the ban on imports of vegetable oil and oil seeds to be reversed."