Why Akwa Palm Should Be Revived Now – Eseme Eyiboh

Akwa Ibom state government recently announced plans to reactivate its moribund Akwa Palm oil Plantation. This forms the basis of the Spotlight, written by Hon ESEME EYIBOH, a former director, Akwa Palm Industries Limited and erstwhile member, House of Representatives

Before now, oil palm plantation was the most important source of income to the people of the South-east region of Nigeria. In the early 60s, when Nigeria was the world largest oil palm producer, the South east region accounted for 90 percent of the total output, with Akwa Ibom state alone contributing about 60 percent. This led the World Bank to declare the region as the global fastest growing regional economy in 1964.

However, with the advent of crude oil in Nigeria, the sector was neglected. The hitherto busy substation of the Nigerian Institute for Oil Palm Research, NIFOR, in Abak, that donated oil palm seedlings to Malaysia in 1960, has now become a shadow of itself. Visitors from Malaysia were said to have collected oil palm seedlings and cross pollinated them in Ikot Okpong, in the then South-Eastern state.

Today, Malaysia is the 2nd largest producer of oil palm in the world after Indonesia. Though Nigeria is ranked third in the world, in terms of land area planted with oil palm, the country is only the fifth largest palm oil producer in the world, due to low yields. The reason for the low yields is not far- fetched.

Nigeria’s oil palm cultivation is done by small scale farmers, who grow oil palms with other crops, instead of the industrial oil palm plantation approach practiced by the Asian Tigers and the Latin Americans. It is against this backdrop that the decision of the Akwa Ibom state government to reactivate the moribund Akwa Palm Oil Plantation is seen as the right step in the right direction.

The move is in response to repeated calls by the Federal Government on states to identify one specific dominant crop in their locality and cultivate it in commercial quantity for local consumption and for export. The 3000- hectare Akwa Palm Plantation was established by the government of the then South- Eastern state in 1962. It stretches across three local government areas namely, Esit Eket, Mbo and Uruefong Oruko. Akwa Palm Plantation had 500 staff in its workforce and contributed an estimated 34 percent of Nigeria’s crude palm oil export in the 1970s and 80s.

With 200,000 stands of palm trees and a 300,000 capacity nursery for oil palm seedlings, the plantation is capable of producing thousands of tons of palm oil annually worth billions of Naira. The plan by the Akwa Ibom state government to reactivate the plantation comes at a time when the average price of a tonne of crude palm oil has reached a decade high of 1,241 US dollars.

Current price of palm oil in Nigeria is about 100,000 naira{ US758) per metric ton, while current international price is USD 438(57,816) per metric ton. Also, the COVID-19 restrictions have further increased global demand for palm oil. The fact that the local price of the commodity is skyrocketing every day, is a clear demonstration that any investment in the sector is futuristic and worthwhile. The move by the UDOM administration should go beyond mere rhetoric and political pronouncements that will not see the light of the day, but end up only on the drawing board.

Modern palm plantations, as seen in Southern Asian countries, are designed as a fully integrated agro industrial establishment, equipped with oil palm trees, palm oil mills, palm kernel extraction plant and vegetable oil refining and fractionation plants. Akwa Palm should not fall short of this standard.

Those handling the project should adopt strategies that will enable the company to obtain international certification as Member of the Global Roundtable on Sustainable Palm Oil, RSPO. This will enable its products to compete favourably in international market.

When fully reactivated, the economic benefits of the Akwa Palm Plantation to Akwa Ibom state in particular and the Nation are enormous. The plantation will work in partnership with small scale oil palm farmers to address the current fluctuating trends in the production and marketing of palm oil in the state. 

Furthermore, this investment will boost the state’s Internally Generated Revenue, IGR, thereby reducing dependence on Federation Allocation. In economic terms, oil palm has a long shelf life span and it is used in more than 50 percent of all the products sold in supermarkets.  The diverse use of oil palm makes it very versatile and capable of lifting millions of people out of poverty.

In Asian countries, oil palm plantations have created millions of well-paying jobs, and enabled tens of thousands of smallholder farmers to acquire their own land. With enough political will, the same feat can be done in Akwa Ibom state and in Nigeria as a whole. If palm oil is produced in commercial quantity in the state, it will encourage the springing up of Micro, Small and Medium Enterprises, MSMEs, where the commodity will be used to produce many body care products such as soap, toothpaste, shampoo and other household cleaning agents.

In the area of foreign exchange earnings, a steady increase in local production of palm oil will promote export and reduce the amount of revenue used to import the item. Available records show that Nigeria spent about 500 million dollars to import 600,000 tons of palm oil in 2016 alone. The amount doubled in 2017. This is a reverse of what obtains in Indonesia where oil palm industry accounts for 1.6 percent of the GDP, employs 4.5 million people and brings in more than 18 billion dollars a year in foreign exchange.

If the Akwa Palm is reactivated and made to work optimally, Akwa Ibom state will in no distant future become a designation centre for manufacturers who are looking for natural seed oils, like palm oil, as an alternative to unhealthy hydrogenated fats.

Akwa Palm should not be seen as a political gimmick to settle party supporters, but as a people-oriented scheme which should receive the support of all, irrespective of political or ethnic background. The Akwa Ibom state government should use the same level of zeal and commitment applied in the execution of the Ibom Air project to bring the Akwa palm reactivation to a reality.

Just as Ibom Air has almost assumed the status of a national carrier, Akwa palm plantation scheme, if well implemented, will equally become the cynosure of all eyes, attracting international recognition and generate income to many households. If states must survive in the post COVID era, they should be a healthy competition among them, in investment in productive ventures that will diversify the economy away from crude oil.

The reactivation of Akwa Palm Oil Plantation in Akwa Ibom state is one of such investments expected not only to enhance the economic fortunes of the state, but also add the much needed value to the national drive for non oil exports. What is required now is for the indigenes of the state, especially the host communities, to cooperate with the government to enable the successful implementation and take off of this lofty programme.

Hon. Eseme Eyiboh wrote from Uyo, Akwa Ibom State

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