By Charles Nwaoguji

Despite the abundance of fruits suitable for juice processing in the country, makers of non-alcoholic beverages have continued to depend on the importation of concentrates for their manufacturing processes.

But Nigeria, is blessed with abundant varieties of fruits grown by farmers or naturally spread by animals or birds. Tomato, water melon, pineapple, pawpaw, citrus, banana, guava, mangoes, cashew, among others, are the common fruits one sees everywhere on major highways across the country. Each region of the country produces at least three of these seasonal fruits in commercial quantity.

However, less than one per cent of the total fruits produced in the country are processed or exported. The rest are either eaten fresh or just left to rot away.

The implication is that farmers reap less from their many years of labour, while the economy loses millions of dollars that could have accrued from the export of these fruits.

For instance in other parts of the world, nations that do not have oil are taking the huge advantages presented by the agricultural sector to extract billions of dollars and boost their economy. Some of these nations today are doing better than Nigeria.

South Africa, Kenya and Ghana are some of the countries on the continent that have taken advantage of opportunities in all sub-sectors of agriculture. Most manufacturing companies in Nigeria have shut down their factories and relocated the offshore due to the lack of foreign exchange to acquire some equipment for the processing of these fruits into concentrates. Consequently, these companies  depend on the importation of concentrates from Swaziland for their operations.

Harsh operating environment

The unfriendly manufacturing environment in the country is one serious factor that is affecting the processing of concentrate for industrial use. The harshness of the operating environment makes it easier for importers to go to other countries to import these fruit juices instead of producing them here in Nigeria.

The current situation is not good for the economy as the country is facing recession now. Where the manufacturing companies cannot withstand this pressure, they relocate their factories. The sector made the plant’s operations unsustainable in the light of the current global economic realities since it had been producing for the Nigerian market alone.

According to Frank Jacobs, the President, Manufacturers Association of Nigeria (MAN), the current situation is not good for the economy as the country is facing recession.

“It is sad and we will keep hearing such bad news if the government does not act fast in restoring the power sector. Instead of companies to be moving in, they are moving out. This will definitely affect the workforce because more people will be losing their jobs as the companies move out,” he said.

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Jacobs noted that the prevailing environment is not suitable for manufacturing as it affects production costs, which in turn hampers effective competition with goods from other world markets.

In the last two years, he said, “about 820 companies have closed shop with most of them relocating to neighbouring countries. Some of those remaining in the country have also diversified most of their production units to those countries, making the nation more of a consumer nation than a manufacturing one.”

Effort to revive beverages industry

The beverage manufacturing sub-sector had depended on the importation of fruit juices and wines sold in the Nigerian market until 2002, when former President Olusegun Obasanjo’s government placed a ban on it.

Apart from that, the government also lowered the tariff on concentrate to five per cent, to encourage local manufacturers take advantage of the highly lucrative industry to enhance the production of juice and wines in the country and discourage importation.

Most beverage manufacturers currently in operation started during this period, but with the bulk of the concentrates imported from US, the Netherlands and other foreign countries.

He said the challenge of poor concentrates in the country could be overcome with improved high-yield seedlings, technology and technical services and better education and enlightenment for farmers.

He noted that the recent drive by the Federal Government to diversify the economy, encourage resource-based industrialisation and backward integration should provide the needed impetus to attract investors.

He urged the government to ensure policy consistency to avoid a repetition of policy summersaults of the past.

The industrialist said that research and development be made an integral part of the country’s backward integration policy while various research institutions should be strengthened through funding and manpower development.

Another area to be considered, he said, was a special lending facility of not more than 5 per cent interest rate for investments in concentrate production in view of the huge capital outlay required for the project.

Jacobs opined that the gains of promoting resource-based industrialisation included conservation of foreign exchange, employment generation, wealth creation, economic diversification and poverty reduction.

“A nation’s over-dependence on importation harms its poise, weakens its future reserves, affects its ability to be fully independent and presents a string of unpredictable social ills,” he said.