Economy
Economic diversification: Nigeria must invest in Oil palm – Stakeholders
Stakeholders in the oil palm sector have called for a paradigm shift from crude to palm oil toward meeting Nigeria’s quest for economic diversification. They made the call at the oil palm stakeholders’ forum under the aegis of National Initiatives for Sustainable and Climate Smart Oil Palm Small Holders (NISCOPS) in West Africa. The event was organised by Solidaridad, a Non-Governmental Organisation and supported by the Kingdom of Netherlands. Dr Rowland Okoli, Lecturer, Political Science and International Relations, Godfrey Okoye University Enugu, said the global oil palm market which currently worths over 62 billion dollars annually underscores the commodity’s economic significance and multiple utility.
Okoli said that the multiple utility and economic significance of palm oil both in the home and industries explains this growth in its global market size. He noted that palm oil production has the capacity to lift millions of rural poor out of poverty and contribute to attainment of the Sustainable Development Goals (SDGs) Okoli said that Nigeria is currently the biggest loser in palm oil business. “The country is unable to provide adequate quantity required domestically, she loses foreign exchange as a result of importation of oil and loses potential revenue that would have been earned if vast area of land was to be utilised in sustainable ways,’’ he said. Okoli, however, emphasised the need to empowering smallholder farmers, saying that they remain players in the oil palm sector. Empowering smallholder farmers would translate to pro-poor strategy that would lift millions of Nigerians out of poverty in line with Federal Government’s plan to lift 100 million Nigerians out of poverty.
“80 per cent of the production come from pockets of smallholders who use manual processing techniques and depend on inherited, naturally or wild growing palm plants. While output outpaces consumption globally, the reverse is the case in Nigeria. This suggests that we are losers in the global palm oil value chain and overall business. Nigeria spends over 500 million dollars in importation of oil annually. This translates to losses in foreign exchange,’’ Okoli said. He said that the cost benefit analysis shows that while the global price per litre of crude oil is 0.44 dollars or 150 naira, palm oil is 0.50 dollars or 170 naira per litre. “Domestic price per litre of petrol is between 143 naira and 145 naira excluding subsidy, kerosene between 200 naira and 250 naira while palm oil is between 300 naira and 350 naira,’’ Okoli said. On his part, Mr Kene Onukwube, Cordinator of the NGO, said that industry and population growth are involved in the demand for palm oil.
“Oil palm is used in many countries for the production of consumer goods in the industries for the increasing domestic population and export to other countries. The situation in Africa particularly, Nigeria raises serious concern as 90 per cent of oil palm produced in Africa ends in food products while only 10 per cent is used in industries. Despite the vast land area and growing population in Africa, the region lags behind in production and consumption of palm oil. This is the reverse of what is obtained globally,’’ Onukwube said. Dr Stella Adejoh, called for the mainstreaming of women and vulnerable groups in the entire aspect of oil palm production process in the country.
Mr Hilary Uche, the National President of Oil Palm Growers Association of Nigeria solicited Federal Government’s assistance in providing the oil palm growers equipment that would boost production. He said that the major challenge facing oil palm production in the country is dearth of machines for oil processing. “The difference between these big firms and small holders is the processing system, they have the machines that can harvest and process in day but we don’t have it. It is just two major machines, the oil palm bunch sterilizer and bunch stripper, most of the small farmers have the presser but they don’t have the other two equipment. If government can procure these equipment for us, it will go a long way to make rural farmers to produce the Special Palm Oil (SPO) which is the correct oil in the standard market,’’ Uche said.
The Arab Africa Trade Bridges (AATB) Program and the Federal Republic of Nigeria formalized a partnership with the signing of the AATB Membership Agreement, officially welcoming Nigeria as the Program’s newest member country. The signing ceremony took place in Abuja on the sidelines of the 5th AATB Board of Governors Meeting, hosted by the Federal Government of Nigeria.
The Membership Agreement was signed by Eng. Adeeb Y. Al Aama, the CEO of the International Islamic Trade Finance Corporation (ITFC) and AATB Program Secretary General, and H.E. Mr. Wale Edun, Minister of Finance and Coordinating Minister of the Economy, Federal Republic of Nigeria. The Agreement will provide a strategic and operational framework to support Nigeria’s efforts in trade competitiveness, promote export diversification, strengthen priority value chains, and advance capacity-building efforts in line with national development priorities. Areas of collaboration will include trade promotion, agribusiness modernization, SME development, businessmen missions, trade facilitation, logistics efficiency, and digital trade readiness.
The Honourable Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, called for deeper trade collaboration between African and Arab nations, stressing the importance of value-added Agribusiness and industrial partnerships for regional growth. Speaking in Abuja at the Agribusiness Matchmaking Forum ahead of the AATB Board of Governors Meeting, the Minister said the shifting global economy makes it essential for African and Arab nations to rely more on regional cooperation, investment and shared markets.
He highlighted projections showing Arab-Africa trade could grow by more than US$37 billion in the next three years and urged partners to prioritize value addition rather than raw commodity exports. He noted that Nigeria’s growing industrial base and upcoming National Single Window reforms will support efficiency, investment and private-sector expansion.
“This is a moment to turn opportunity into action”, he said. “By working together, we can build stronger value chains, create jobs and support prosperity across our regions”, Edun emphasized. “As African and Arab nations embark on this journey of deeper trade collaboration, the potential for growth and development is vast. With a shared vision and commitment to value-added partnerships, we can unlock new opportunities, drive economic growth, and create a brighter future for our people.”
Speaking during the event, Eng. Adeeb Y. Al Aama, Chief Executive Officer of ITFC and Secretary General of the AATB Program, stated: “We are pleased to welcome Nigeria to be part of the AATB Program. Nigeria stands as one of Africa’s most dynamic and resilient economies in Africa, with a rapidly expanding private sector and strong potential across agribusiness, energy, manufacturing, and digital industries. Through this Membership Agreement, we look forward to collaborating closely with Nigerian institutions to strengthen value chains, expand regional market access, enhance trade finance and investment opportunities, and support the country’s development priorities.”
The signing of this Agreement underscores AATB’s continued engagement with African countries and its evolving portfolio of programs supporting trade and investment. In recent years, AATB has worked on initiatives across agribusiness, textiles, logistics, digital trade, export readiness under the AfCFTA framework, and other regional initiatives such as the Common African Agro-Parks (CAAPs) Programme.
With Nigeria’s accession, the AATB Program extends it’s presence in the region and adds a key partner working toward advancing trade-led development and fostering inclusive economic growth.
Federal Executive Council (FEC) has approved the 2026–2028 Medium-Term Expenditure Framework (MTEF), a key fiscal document that outlines Nigeria’s revenue expectations, macroeconomic assumptions, and spending priorities for the next three years. The approval followed Wednesday’s FEC meeting presided over by President Bola Tinubu at the State House, Abuja. The Minister of Budget and Economic Planning, Senator Atiku Bagudu made this known after the meeting.
The Minister said the Federal Government is projecting a total revenue inflow of N34.33 trillion in 2026, including N4.98 trillion expected from government-owned enterprises. Bagudu said that the projected revenue is N6.55 trillion lower than earlier estimates, adding that federal allocations are expected to drop by about N9.4 trillion, representing a 16% decline compared to the 2025 budget.
He said that statutory transfers are expected to amount to about N3 trillion within the same fiscal year. On macroeconomic assumptions, FEC adopted an oil production benchmark of 2.6 million barrels per day (mbpd) for 2026, although a more conservative 1.8 mbpd will be used for budgeting purposes. An oil price benchmark of $64 per barrel and an exchange rate of N1,512 per dollar were also approved.
Bagudu said the exchange rate assumption reflects projections tied to economic and political developments ahead of the 2027 general elections. He said the exchange rate assumption took into account the fiscal outlook ahead of the 2027 general elections.
The minister said that all the parameters were based on macroeconomic analysis by the Budget Office and other relevant agencies. Bagudu said FEC also reviewed comments from cabinet members before approving the Medium-Term Fiscal Expenditure Ceiling (MFTEC), which sets expenditure limits. Earlier, the Senate approved the external borrowing plan of $21.5 billion presented by President Tinubu for consideration The loans, according to the Senate, were part of the MTEF and Fiscal Strategy Paper (FSP) for the 2025 budget.
The spot rate on Nigerian Treasury bills has been increased by 146 basis points by the Central Bank of Nigeria (CBN) following tight subscription levels at the main auction on Wednesday. The spot rate on Treasury bills with one-year maturity has now surpassed Nigeria’s 16.05% inflation by 145 basis points following a recent decision to keep the policy rate at 27%.
The Apex Bank came to the primary market with N700 billion Treasury bills offer size across standard tenors, including 91-day, 182-day and 364 day maturities. Details from the auction results showed that demand settled slightly above the total offers as investors began to seek higher returns on naira assets despite disinflation.
Total subscription came in at about N775 billion versus N700 billion offers floated at the main auction. The results showed rising appetite for duration as investors parked about 90% of their bids on Nigerian Treasury bills with 364 days maturity. The CBN opened N100 billion worth of 91 days bills for subscription, but the offer received underwhelming bids totalling N44.17 billion.
The CBN allotted N42.80 billion for the short-term instrument at the spot rate of 15.30%, the same as the previous auction. Total demand for 182 days Nigerian Treasury bills settled at N33.38 billion as against N150 billion that the authority pushed out for subscription. The CBN raised N30.36 billion from 182 days bills allotted to investors at the spot rate of 15.50%, the same as the previous auction.
Investors staked N697.29 billion on N450 billion in 364-day Treasury bills that was offered for subscription. The CBN raised N636.46 billion from the longest tenor at the spot rate of 17.50%, up from 16.04% at the previous auction.
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