The oil fortunes of the country have been highly susceptible to global oil shocks and other economic upheavals world over no doubt. But the Nigeria Export Promotion Council (NEPC) has since set machinery in motion to address the gaps by exploring opportunities in nation’s the non-oil sector, including seeking new allies and markets. In this reports Franca Ochigbo examines some of the important milestones recorded by the Council in the area of foreign direct investment in recent times
There is no doubt that the non-oil sector is a key segment of the economy and has the potential for job creation, wealth creation, earn foreign exchange and sustain economic development for the country.
But the irony, however, is that the nation’s overreliance on receipts from the oil exports may have blurred whatever gains or efforts it ought to have made to boost its non-oil sectors.
Thankfully, successive administrations which realised this lacuna made concerted efforts aimed at promoting the nation’s non-oil export sector since it hopes that such opportunities will not only increase the nation’s non-oil export base will ultimately benefit the economy as a whole.
According to the Central Bank of Nigeria (CBN) Governor Godwin Emefiele, there is need to incentivise exporters to repatriate their export proceeds through the official channels and the recommendation to create export terminals across various export hubs in the country.
According to analysts, the new initiative of the CBN RT200 programme is well thought out.
According to Igbasanmi Ajao, the CBN RT200 FX programme, which aims to achieve $200 billion in foreign exchange earnings from non-oil proceeds over the next three to five years, has very laudable objectives, including enhancing foreign exchange inflow, diversifying the source of FX inflow, increasing the level of contribution from non-oil export, and ensuring stability and sustainability of FX flows.
He however regretted that “Nigeria’s non-oil export is quite low compared to other African top oil producers. This exposes the economy to oil price/production risks especially global oil shocks and other world economic upheavals.”
Highlighting the importance of non-oil export to the economy, Ajao further pointed out that the CBN has undertaken several initiatives to promote the non-oil export sector because of its firm belief that the non-oil export sector holds enormous potential to contribute to employment generation, wealth creation and economic growth.
NEPC charmed offensive to drive non-oil export
One agency at the forefront of driving the non-oil exports is the Nigeria Export Promotion Council (NEPC).
From available information, the Council has achieved some important milestone specific to route to new markets and export channels hitherto beyond its reach.
At the last count, the NEPC recorded a significant growth in the non-oil export sector, by carrying out far-reaching measures which has translated positively based on modest successes achieved thus far.
Specifically, Nigeria, whose products suffered a pariah status in some parts of Europe, America, Middle East Asia, is now the latest bride in town as old foes have since aligned with it.
Top sources at the Council revealed to our correspondent recently that the three top destinations for Nigerian products in the area of non-oil exportable products are now the United States of America, Indian and Brazil.
Naturally, it is expected that exportation of products to other African countries will be overwhelming but in this case European countries are topping the list as top destination of export products.
Of the top 10 export destination for Nigerian products only two African countries made the list, Benin and Niger Republic.
Important milestones
It is also worthy of note that the Council’s set target in spite of the recession that affected businesses in 2021 has been achievable as the non-oil sector has recorded a significant growth as a total of 4,146,534 metric tonnes of products worth $2.593 billion were exported between January and June 2022.
This represented 62.37% increase as against the sum of $1.59 billion for the first half year in 2020-2021 which stood at $981.442 million respectively.
These figures were culled from the non-oil performance reports of various pre-shipment inspection agents appointed by the Federal Government to determine the volume, value and destination of Nigerian non-oil export in line with section 12 of pre-shipment inspection Act, Cap P25 LFN 2004.
Besides, the analysis from returns by these pre-shipment inspection agents indicates that the January -June 2022 export performance was the highest half year non-oil export performance since 2018.
Commenting on these significant milestones, the Executive Director/CEO of the NEPC, Dr. Ezra Yakusak during the presentation of the first half year 2022 progress report on non-oil export said over 200 different products ranging from manufactured, semi-processed, solid minerals to raw agriculture products were reported to have been exported in the period under review.
He noted that unlike what was applicable in the past, the trend of products exported from Nigeria is gradually shifting from its traditional agricultural exports to semi- processed manufactured goods. This can be gleaned from the following products classification as contained in a Pre-shipment inspection agents PIA report, manufactured products 36.28%.
Yakusak further revealed that the top 15 exported products in the first half year of 2022 were urea, fertilizer which recorded 32.49% of total export while cocoa, beans, sesame seed and aluminum ingots contributed 12.65% and 5.07% respectively within same period.
According to him, “During the period under review different Nigerian products were exported to America, Asia, Europe, Oceania regions and Africa. Of these figures, USA, Brazil, and Indian were the top three of the export destinations based on the value of imports.
“It should be noted that Benin and Niger Republic are Nigerians immediate neighbours and as such they are traditionally gateways for informal export activities. This bi-annual report therefore indicates that the Council’s campaign mainstreaming informal export is gradually yielding results.”
Again the non-oil export returns received from pre-shipment inspection agents could be attributed to NEPC new focus on grassroots development, such as ‘export for survival’ campaign which was aimed at sensitising general public to embrace non-oil export as a major driver in diversification of Nigerian economy with the resultant effect of boasting foreign exchange earnings.
The first half of exported figures exported figures for five years, 2018-2022 are showed that in the first half of 2018, US$ 1,216.486million was recorded while in 2019 was US$ 1,057.022million.
In 2020, US$ 981.442million was recorded with a marginal increase recorded in 2021 with a earning of US$ 1,597.00million and in 2022 a significant increase of US$ 2,593.28.
The NEPC boss further noted that over 200 products were reported to have been exported in the 1st half of the year 2022, ranging from manufactured, semi processed, solid minerals to raw agricultural commodities. The non-oil export of Nigerian is gradually diversifying from its traditional agriculture export to semi processed manufacturing.
The ED CEO spoke on export rejects, stating that in a bid to reduce the incidences of Export Rejects, the NEPC is working assiduously with the Ministry of Industry, Trade and Investment among other relevant MDAs to end the rejection of Nigeria’s products in the international market.
The Minister Industry, Trade and investment had earlier and a Technical Committee on Export Rejects. The Committee which is chaired by the Director, Commodities and Export Department of FMITI is due to submit its report to the Minister.
Similarly, the NEPC has finalised arrangements to embark on an Inter-Agency working on a fact finding visit to the United Kingdom to ascertain specific causes for rejection of imported commodities from Nigeria.
The mission is to provide Nigerian Export regulatory facilitating agencies the opportunity of observing the processes of agricultural commodities’ import procedures and to also interact with port health and food import regulatory agencies at the border control points in the United Kingdom.
Yakusak also highlighted on the establishment of export trade houses, stating that Nigeria took a giant leap towards making Nigerian products competitive in the global market with the establishment of three ETHs in Cairo Egypt, Lome in Togo and Nairobi Kenya respectively. Thus it is targeted at increasing Nigerian international market share and growth, enhanced the visibility of Nigerian products as well as increase foreign exchange inflow and creating employment for youths. Presently plans are on the way to create another ETH in Dubai United Arab Emirates UAE among others.
