UPDATED: Nigeria’s central banks suspends forex for maize/corn imports, seeks local output boost

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A woman roasts maize cobs on the side of the road in Lawley informal settlement in the south of Johannesburg, South Africa, April 24, 2019. REUTERS/Siphiwe Sibeko

The Central Bank of Nigeria (CBN) on Monday discontinued the processing of Forms M for importation of maize/corn into the country.

The apex bank directed all authorised dealers to submit the list of Forms M already registered for the importation of maize/corn using a designated format on or before the close of business on Wednesday, July 15, 2020.

It said the move is part of efforts to increase local production, stimulate a rapid economic recovery, safeguard rural livelihoods and create jobs. Many jobs have been lost as a result of the ongoing Covid-19 pandemic.

“As part of efforts by the Central Bank of Nigeria to increase local production, stimulate a rapid economic recovery, safeguard rural livelihoods, and increase jobs which were lost as a result of the ongoing COVID-19 pandemic, Authorised Dealers are hereby directed to discontinue the processing of Forms M for the importation of Maize/Corn with immediate effect,” the CBN said in a circular signed by O. S. Nnaji, its director, trade and exchange department.

“Accordingly, all Authorised Dealers are hereby requested to submit the list of Forms M already registered for the importation of Maize/Corn using the attached format on or before the close of business on Wednesday July 15, 2020. Please ensure strict compliance,” the circular said.

The CBN in 2015 excluded importers of some food items from accessing foreign exchange in order to encourage local production of such items.

Form M is a document to be completed by all importers into Nigeria. The documentation also enables lenders submit bids to the central bank for hard currency to pay for the imports.

The government is seeking to fund a balance of payment gap of around $14 billion in 2020, according to central bank data.

Dollar demand has been swelling and piling pressure on the naira. Importers with past due obligations have scrambled for hard currency while providers of foreign exchange, such as offshore investors, have exited.

The oil price crash caused by coronavirus pandemic has exacerbated a shortage of dollars for Nigeria, whose reserve has declined 20% to $36.13 billion over the last year.

Last year, the central bank told lenders to stop processing milk imports on a credit basis after it said it would ban access to forex for diary to spur local production. It later lifted forex restrictions for milk imports for six firms.

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