There are strong indications that the federal government’s efforts to gain back some of the foreign-exchange earnings lost to falling oil prices are causing delays in exports including cocoa.
The new Nigerian export rule introduced has led to about 100,000 tonnes of cocoa beans trapped at ports.
The backlog occurred after the change which now means approvals to clear a container for shipping are taking up to 40 days instead of 7.
President of Cocoa Exporters Association of Nigeria, Pius Ayodele, said that not only are there about 100,000 tons of cocoa beans trapped at the ports but a further 100,000 tonnes of a variety of agricultural commodities in warehouses around the country.
Nigeria is the world’s fifth largest cocoa producers, a key ingredient in chocolate. Africa’s largest economy fell into a recession last quarter amid widespread criticism of the governments’ fiscal policy.
The task ahead for the finance minister Zainab Ahmed is a formidable one, dealing not only with the impact of COVID-19, the subsequent drop in the oil price (Nigeria is a big exporter), but also inflation and a high birth rate, among other challenges.
The Central Bank of Nigeria started insisting on additional documentation to ensure export proceeds are returned to the country which explains the additional delays.
The documentation process involves Nigerian Export Proceed (NXP) numbers, Form NXP, which is a mandatory document to be completed by all exporters through authorised dealer bank for shipment of goods outside Nigeria irrespective of the value and whether payment is involved.
Any customer willing to engage in export business is required to register with the Nigeria Export Promotion Council.
According to the CBN rules, the basic documentary requirements for an export transaction include, a duly completed Form NXP, a Proforma Invoice, a Sales Contract/ Agreement, and where applicable, NEPC Registration Certificate.