Quota allocation to be tied to performance, says Enoh
The Executive Secretary/CEO of the National Sugar Development Council (NSDC), Kamar Bakrin, has briefed critical stakeholders on the progress made by the council in removing impediments to local sugar production in the country.

This comes as the Minister of State for Industry, John Owan Enoh, disclosed that the allocation of quota to operators of the backward integration programme (BIP) would be based on performance going forward.

Speaking at a tripartite meeting of the agency, the Ministry of Industry, Trade and Investment and the major BIP operators, the NSDC boss said the council has elevated performance monitoring and oversight of the BIP operators beyond what the Sugar Industry Monitoring Group (SIMOG) was known for.

According to him, NSDC under his watch has emphasised robust, one-on-one, physical and virtual engagement with the operators, giving them targets and following up on deliverables.

On the feedback he has obtained from the operators, the Executive Secretary told the gathering, chaired by Enoh, “The operators have complained about the existing loopholes in the free trade zone regime, which they believe certain participants in the NSMP have exploited. They also cited delays in the clearing of equipment at the ports, smuggling of sugar into the country, and host community resistance to the expansion of their BIP programmes as the primary causes of the delays in their BIP execution.

“The loopholes in the FTZ regime are being addressed by the ongoing amendment of the NSDC Act by the National Assembly.”

The amendment process, which has involved engagements with the relevant National Assembly Committee and key stakeholders, among other objectives, addresses the concern of the BIP operators and also makes the industry more attractive to other investors.

“The delays in the clearing of equipment at the ports are something that is also being addressed with the Nigeria Customs Service (NCS). On the issue of smuggling, the volumes do not significantly alter the economics of sugar production and the market dynamics. But regardless, we have engaged the relevant security agencies on the matter.

“In terms of host community resistance, the council consistently intervenes and has driven the resolution of these grievances, especially the more significant ones that have been experienced in places like Numan in Adamawa State, and this has been resolved. At the moment, there is currently no backward integration programme in which the host community has restricted access to a significant proportion of land in the country,” he added.

He also informed the gathering that the NSDC is working on getting comprehensive financing support to aid the development of the industry, and in addition to help the existing operators lower the cost of irrigation.

“One of the things we need to do is aggressively push for a sugar sector development fund, as well as secure the kind of guarantees that will allow the cost of borrowing to come down. Also, to possibly extend whatever support we can provide around the issues of irrigation facilities, not necessarily as grants, but just to lower the overall cost of irrigation infrastructure,” he said.

Emphasising the need for severe sanctions for underperformance, Bakrin said: “We believe that the two critical things that must happen are that the operators must act immediately to stop the deterioration in the output of their current operations, especially around the issues of agronomic and factory practices, which are clearly below global norms and standards. They must also actively expand their existing brownfield operations. In addition, we believe that without going into the specifics of individual companies for confidential reasons, the operators need to, as a matter of urgency, take a much more aggressive approach to expand their BIP programmes to ensure that they can deliver on the NSMP targets.

The minister said, going forward, allocation of raw sugar importation quota to each of the operators must be strictly tied to performance. He added that his ministry would take more interest in also monitoring the activities and performance of the BIP operators.