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Consumer goods producers groan under border closure

Consumer goods producers groan under border closure

Benin side of the Idiroko border

Many companies operating in the Fast Moving Consumer Goods sector are currently not finding the prolonged closure of the country’s borders funny.

Their worry stems from the reported high cost currently being incurred in exporting their goods and importing some condiments used in the manufacturing of their goods from the neighbouring African countries through the seaports.

Investigations by our correspondent revealed that before the closure of the borders in August 2019, these companies distributed their goods by road through trucks and brought in the condiments through same process.

But all that changed with the closure, as the operators in that sector had to now do all these through the seaports.

Some of the operators, who spoke on condition of anonymity for fear of reprisal from the government, said they spent money to either export their finished goods or import their condiments and it took a longer time for the items to arrive at their destinations.

One of them who spoke for the group said, “The border closure has really affected us. Before the border closure in August 2019, many of us in the FMCG sector usually exported our finished products by road to the West African sub-region.

“Again, we brought in some condiments for some of our beverages from our sister company in Ghana which has been affected too. Since the closure of the border, the process has changed. We now have to take the goods out through the ports, and the same process is required to bring in some of the components needed in the production of some of the beverages.

“Apart from being expensive, it could take a longer time for these goods to arrive at their destinations.”

The Director-General, Lagos Chamber of Commerce and Industry, Dr Muda Yusuf, while talking about the closure of the border listed the unintended consequences of the closure to include complete shutdown of cross border trade (imports and exports) between Nigeria businesses and their counterparts in West African countries.

This, he observed, had grave consequences for investments and jobs, adding that industries had invested in products registered under the ECOWAS Trade Liberalisation Scheme.

“These are investors whose business models were anchored on market opportunities in the ECOWAS and these investments have been completely disrupted and dislocated,” he said.

The chamber further said that majority of the victims of the border closure were small businesses, most of them in the informal sector, stressing that their means of livelihood had been put in great jeopardy.

However, the government said it had shut the borders given the spate of insecurity in the country and the need to protect the local industry.

It has been a mixed bag of feelings as some businesses had been adversely affected. But those operators in the agricultural sector, such as local rice and poultry farmers, lauded the closure, as their fortunes had increased.

Foreign parboiled rice and frozen poultry products that were hitherto smuggled into the country through the land borders were said to have been largely curtailed.

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