Nigeria's Sugar Master Plan: Ignoring losers from industrial policy can be costly

Abstract

Motivation

Industrial policies, as tools for economic advancement, disrupt established systems and practices, leading to disputes. The Nigerian Sugar Master Plan (2013–2024) is just such a case. The Plan proposed to stimulate domestic sugar growing and refining, by restricting imports and providing incentives for investors in sugar estates and refining mills.

Purpose

This study examines the impact of industrial policies on different groups, identifying the origins and impacts of subsequent disputes. Specifically, it explores how the failure to anticipate opposition caused the Nigerian Sugar Master Plan to largely fail.

Methods and approach

Informed by the framework of political settlements, we divide disputes into general (public) and specific (individual), exploring the nuances of each through qualitative analysis. Empirical data from case studies, particularly focusing on disputes over land use and trade in sugar, are used to unravel the layered repercussions of policy-induced disputes.

Findings

Unaddressed disputes, both broader societal and individual, have stymied the objectives of the Nigerian Sugar Master Plan.

Land allocations to investors in large-scale sugar estates have been disputed by dispossessed farmers, preventing establishment of several estates: production targets for sugar growing have been missed.

Importers of refined sugar could not legally continue their trade; instead, some reverted to smuggling in refined sugar, driving down the local prices—and cutting the profits of companies growing and refining sugar.

Opposition to the Sugar Plan, despite media campaigns to convince the public to accept it, has caused the Plan to fail in large part.

Policy implications

Industrial policies need to address the concerns of those potentially losing their businesses, jobs, and land to the policies. If not, opposition by losing parties is likely to cause the policies to fail.