Adesina’s keynote speech, which was delivered by Damilola Eniaiyeju, director of Agricultural Extension services, at the 50th anniversary of the Cocoa Research Institute last week, said, “The Export Expansion Grant (EEG) has helped to expand incentives for commodity exports but has stifled development of local grinding and processing, as focus was on exporting raw beans,” The Nigerian Tribune reports.
Nigeria is one of the four leading countries (along with Cote d’Ivoire, Ghana and Cameroon) responsible for producing 70 percent of the world’s cocoa, according to the African Business Review. Nigeria has eight cocoa processing factories with a total capacity of 157,000 metric tons of cocoa beans, Adesina said. He envisions Nigeria moving beyond just exporting raw cocoa beans.
He says that companies have invested $267 million and the cocoa-processing factories, even at their lowest capacity, generated between $90 million and $400 million annually.
“As we improve the enabling environment, they will have the capacity to each generate $500 million per year,” he said.
In order to capitalize from the potential capacity, Adesina said that it would require investment into chocolate manufacturing companies and transitioning from the EEG to a Value Addition Expansion Grant in order “to boost industrial processing of cocoa into cocoa liquor, cocoa cakes, cocoa powder, cocoa butter and chocolates.”
A special cocoa intervention fund would be set up to support processors in asset acquisition and working capital and the government would create incentives for cocoa processors.
Adesina’s promotion stems from his concerns that Nigeria is too dependent on the oil economy. He thinks Nigeria can avoid potential setbacks if it diversifies and utilizes other sectors that could contribute to the national revenue generation, according to the Nigerian Tribune.
“The decline in the price of crude oil is a wake-up call,” Adesina said. “Agriculture must become Nigeria’s new oil. Nigeria must now invest even more in the agriculture sector to diversify the economy and build economic resilience.”
Adesina’s remarks were optimistic about the future agriculture in Nigeria could help provide. “Nigeria’s food import bill declined from $6.9 billion in 2009 to $4.34 billion by the end of 2013, thus trimming foreign exchange deficits,” he noted.
The Cocoa Transformation Agenda (COCTA) plans to help Nigeria become a larger portion of the world cocoa market.