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Nigeria Can Earn $505m From Processed Cashew — Study

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Nigeria to expand Cashew Nut export by 2020
  • Nigeria Can Earn $505m From Processed Cashew

Nigeria stands to earn $505m from exports of processed cashew nuts in the next seven years if attention is paid to scaling up production and value addition to the crop.

This is contained in a study of the Nigerian cashew industry conducted by the Cashew Processors and Packagers Association of Nigeria.

Nigeria currently exports only Raw Cashew Nuts, and according to the Chief Executive Officer of Nigerian Export Promotion Council, Mr. SegunAwolowo, the country produced 160,000 metric tonnes of the RCN in 2015 worth $253m.

He said that processing even 50 per cent of that volume of the RCN for exports would create 9,000 additional jobs.

The study was presented by the Managing Director, Valency Cashew Processing Limited, Mr. Basba-NandBalodi, to the team from NEPC who paid a visit to his processing plant recently.

It indicated that Nigeria had the potential to increase the production of the RCN from the current 160,000MT to over 500,000MT within the next seven years and to 1000, 000MT in the next 12 years.

Balodi said that only about 15 per cent of the RCN was being processed in Nigeria, generating about 3,000 direct and 12,000 indirect jobs.

He said, “Within five to seven years, when production grows to 500,000MT, 167,000 direct and indirect jobs will be created and if 50 per cent of that is processed for exports, the country will generate $505m.”

He lamented challenges facing cashew processors, pointing out that they were unable to compete with their peers in other countries.

He said, “Nigerian processing industry is unable to compete with industries in India, Vietnam, Asia as well as Benin Republic and Ivory Coast in West Africa.

“Lack of electricity, poor infrastructure and inefficient incentive schemes, non-readily available single-digit interest funds for processing as well as lack of government policy support on value realisation of by-products like empty cashew shell and husks are among major challenges facing processors in Nigeria.

“In Nigeria, processors spend around $20 per MT on disposal of these by-products whereas in India and Vietnam, by-products generate about $150 per MT to the processors.”

Balodi suggested that for the sector to be developed, the government should set up a cashew council under NEPC or the Ministry of Agriculture and provide a window period up for processors to buy the RCN for local processing to coincide with the time adopted by neighbouring Benin Republic.

He advised the government to impose an export levy of $150 per MT on the RCN, starting from January 2018.

He said, “With the RCN export of about 160,000MT, NEPC can expect to collect about $22.5m and with growing population, this revenue can grow every year. This levy already applies to the Benin Republic and Cote D’ivore. “

He urged the government to promote the consumption of cashew and create awareness of its health benefits.

Awolowo assured the processors who were also present during his visit to the cashew processing plant that government was aware of their challenges and was taking steps to address them.

He said that cashew was one of the 13 national strategic export products chosen by the government under category B of the Zero Oil Plan, which was highlighted in the recently launched Economic Recovery and Growth Plan of the government.

He pledged that the council would continue to support the operators through capacity building projects such as the NEPC/United States Agency for International Development/NEXTT project to improve competitiveness in the value chain.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Guinness Nigeria Postpones Spirits Importation Exit, Extends Deal with Diageo

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Guinness - Investors King

Guinness Nigeria Plc has announced a delay in its plan to halt the importation of spirits as it extended its agreement with multinational alcoholic beverage company Diageo until 2025.

The decision, communicated through a corporate notice filed with the Nigerian Exchange Limited on Tuesday, cited a longer-than-expected transition period for separating its business from Diageo’s.

Initially slated for discontinuation in April 2024, the importation of premium spirits like Johnnie Walker, Singleton, Baileys, and others under the 2016 sale and distribution agreement with Diageo will now continue for an additional year.

The extension comes as the process of business separation between Guinness Nigeria, a subsidiary of Diageo, and Diageo itself faces unexpected delays.

In October, Guinness Nigeria had announced plans to cease importing spirits from Diageo, a move aimed at reducing its foreign exchange requirements.

However, the separation process has encountered unforeseen hurdles, necessitating the extension of the importation agreement.

The notice, signed by the company’s Legal Director/Company Secretary, Abidemi Ademola, highlighted the ongoing efforts by Guinness Nigeria and Diageo to implement the separation, originally scheduled for completion by April 2024.

The extension underscores the complexity of disentangling the businesses and ensuring a smooth transition.

Guinness Nigeria reaffirmed its commitment to the long-term growth strategy, aligning with Diageo’s decision to establish a new, wholly-owned spirits-focused business.

Despite the delay, both companies remain dedicated to managing the importation and distribution of international premium spirits in West and Central Africa, with Nigeria as a key hub.

The postponement comes amid challenges faced by Guinness Nigeria, including significant exchange rate losses, which amounted to N49 billion in the 2023 half-year operations.

Despite these setbacks, the company remains optimistic about its future prospects in the Nigerian market.

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Private Sector Warns: Interest Rate Hike to Trigger Job Cuts and Inflation Surge

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Private employers

As the Central Bank of Nigeria (CBN) announced a hike in the Monetary Policy Rate (MPR) from 22.75% to 24.75%, concerns have been raised by the private sector regarding the potential ramifications on job stability and inflationary pressures.

The move, aimed at curbing inflation and stabilizing the exchange rate, has prompted apprehension among business operators who fear adverse effects on the economy.

Representatives from the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) and the Nigerian Association of Small Scale Industrialists have voiced their worries over the increased difficulty in accessing affordable credit.

They argue that the higher interest rates will impede the private sector’s ability to borrow funds for expansion and operational activities.

This, they fear, could lead to a reduction in business investments and subsequently result in widespread job cuts across various sectors.

The Lagos Chamber of Commerce and Industry (LCCI) acknowledged the necessity of the interest rate hike but emphasized the potential negative consequences it may bring.

While describing it as a “price businesses would have to pay,” the LCCI highlighted the current fragility of the economy, exacerbated by various policy missteps.

They cautioned that the increased cost of borrowing could stifle entrepreneurial activities and discourage expansion plans critical for economic growth and job creation.

Experts have echoed these concerns, warning that the tightening monetary conditions could exacerbate inflationary pressures and hinder economic recovery efforts.

With inflation already soaring at 31.70%, the rate hike could further fuel price hikes, especially in essential goods and services, thus eroding the purchasing power of consumers.

However, CBN Governor Yemi Cardoso defended the decision, citing the imperative to address current inflationary pressures and ensure sustained exchange rate stability.

He emphasized the need to restore the purchasing power of ordinary Nigerians and expressed confidence that the economy would stabilize by the end of the year.

Despite assurances from the CBN, stakeholders remain cautious, calling for a more nuanced approach that balances the need for price stability with the imperative of fostering economic growth and job creation.

As businesses brace for the impact of the interest rate hike, all eyes are on the evolving economic landscape and the measures taken to mitigate its effects on livelihoods and inflation.

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Breaking Barriers: Transcorp Hotels CEO Shares Journey from Crisis to Success

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Dupe Olusola

Dupe Olusola, the Managing Director/CEO of Transcorp Hotels Plc, reflects on her remarkable journey from navigating the depths of a global pandemic to achieving unprecedented success in the hospitality industry.

Appointed in March 2020, amidst the onset of the COVID-19 pandemic, Olusola found herself at the helm of a company grappling with the severe economic fallout and operational challenges inflicted by the crisis.

Faced with a drop in occupancy rates from 70% to a mere 5%, Olusola and her team were confronted with the daunting task of steering Transcorp Hotels through uncharted waters.

Undeterred by the adversity, they embarked on a journey of transformation, leveraging creativity and resilience to navigate the turbulent landscape.

Implementing innovative strategies such as introducing drive-through cinemas, setting up on-site COVID-19 testing facilities, and enhancing take-away services, Transcorp Hotels adapted to meet the evolving needs of its guests and ensure continuity amidst the crisis.

Embracing disruption as a catalyst for growth, Olusola fostered a culture of collaboration and teamwork, rallying her colleagues to overcome obstacles and embrace change.

Through unwavering determination and a commitment to excellence, Transcorp Hotels emerged from the pandemic stronger than ever, breaking profit and revenue records year after year.

“It’s indeed been a great opportunity to learn and relearn, to lead and to grow. When you see success stories, remember it’s a journey with twists, turns, ups and downs but in the end, it will all be okay”, she said.

Olusola’s leadership exemplifies the power of adaptability and perseverance, inspiring her team to transcend limitations and chart a course towards unprecedented success.

As Transcorp Hotels continues to flourish under her stewardship, Olusola remains steadfast in her dedication to driving innovation, fostering growth, and breaking barriers in the hospitality industry.

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