Nigeria is the Leading Beneficiary of Export Liberalisation

17 December 2016 By Emeka Anaeto

The Chairman of the Export Promotion Group at the Manufacturers Association of Nigeria, MAN-EG is of the opinion that with the right policies Nigeria can navigate her way out of recession in 2017, exploring non-oil export and the ECOWAS Trade Liberalisation Scheme, ETLS.

The right and most suitable way out of the economic recession currently ravaging the Nigerian economy is formulation and implementation of economic policies that will strengthen the manufacturing sector and attract foreign investors both as Foreign Direct Investors (FDI) and Foreign Portfolio Investors (FPI). I take this position because, the manufacturing sector is critical to every economy across the globe and Nigeria’s case is no different. Policy decisions of successive governments have contributed to the challenges confronting the sector today. A good number of manufacturers have closed shop across the country while some especially the SMEs that are still in operation are retrenching workers, leading to increase in the number of the unemployed. Unfortunately, we have found ourselves in an economic situation where monetary policy and fiscal policy are not convergent.

A spectacular lesson of globalization is that local markets no matter how large are no longer a guaranteed platform to promote industrial productivity. That is why countries like China and India have incorporated export trade into their respective foreign policy as a way to strengthen their position in international trade. Thus, the manufacturing sector which is strategic and instrumental to revamping the economy wants the government to revive the Export Expansion Grant (EEG) which actually is the only incentive that has served as a catalyst to boost on non-oil export in Nigeria. All over the world, even in developed countries where there are no infrastructural deficiencies like we have in Nigeria, government give incentives to their manufacturers. For instance, Australia, India, China, Singapore, Uganda and so on, are actively involved in boosting their non-oil export sector through various kinds of incentives.

In year 2015 alone, the Chinese government paid a total of 656.5 billion yuan ($102.7 billion) in export tax rebates in the first six months, up 12.4 percent from 2014. The Federal Government introduced the EEG scheme to encourage non-oil exports as an alternative source of revenue to reduce our economy’s dependency on petroleum and related products. The scheme came into effect under the Export (Incentives and Miscellaneous Provisions) Act Cap 118 of 1986 (as amended by the Act No. 65 of 1992). The policy which is domiciled in Nigerian Export Promotion Council (NEPC) recorded huge success with the volume of non-oil exports rising from USD700 million in 2005 to USD 2.9 billion in 2013 with export of key commodities to ECOWAS and the European Union. The sector witnessed a sharp decline from US$2.9billion in 2013 to US$1.1billion in 2015 which is about 59 percent decrease. As at the end of the third quarter of 2016, the value of non–oil export had decreased to USD192,804,298. The trend in decline which began in 2014 was due, largely to government’s interruptions in the implementation of the EEG and non-acceptance of the NDCC by the Nigeria Custom Service. From the foregoing statistics, it is obvious that there is positive correlation between the scheme and non-oil export growth in Nigeria.

According to Adolf Onwuka Nnanyel, a distinguished bilingual business development expert for sales across West and Central African countries, the sector has made significant contributions to the purchase and consumption of made in Nigeria products across west and Central Africa as well as to employment generation. Research has it that from 2005 to 2013 job creation rose from 105,220 in 2005 to 211,291 by 2010 as published by the Nigerian Export Promotion Council (NEPC). It began to experience a sharp decline from 2011 to 183,823 and 159,926 largely due to interruption of the EEG. Also, the non-oil sector’s contribution to Gross Domestic Product (GDP) has been significant. Non-oil export grew by 8.80 percent at the end of fourth quarter 2012 it however went down to 7.88 percent by end of fourth quarter 2013.

Weak policy implementation on the part of government! The decrease in non-oil export can be attributed to, for instance the frequent disruptions of non-oil export driver in Nigeria which is the EEG. The scheme has been interrupted 10 times for different reasons and since January 2014 till date has been on hold. Interestingly, government has promised to revive the EEG early next year, 2017 and if they keep to it, the economy is going to witness a reverse trend of this current fall in non-oil export. By the third quarter, economic recession would become history in Nigeria.

In ECOWAS, Nigeria still play significant role in intra-regional trade among other member-states. The trade value of trade between Nigeria and other ECOWAS Countries in 2013 increased by the following percentages over 2012. Trade with Ghana increased by 24 percent, Cote d’Ivoire 23 percent, Benin Republic 25 percent, Burkina Faso 293 percent, Guinea 124 percent, Senegal percent, and Liberia 26 percent. As at the end of third quarter 2016, non-oil exports to ECOWAS countries stood at USD 55.6 million with Ghana as the major export destination according to the report filed by pre-shipment agents representing 26 percent of the total value of non-oil exports within the third quarter. Even at that, Manufacturers Association of Nigeria Export Promotion Group (MANEG) is making frantic efforts to increase the volume of intra-regional Trade through the Trade House platform and plans are already underway awaiting support from government.

The ECOWAS Trade Liberalization Scheme (ETLS) is a giant stride taken by ECOWAS to promote intra-regional trade among its members towards the creation of a common market. The ECOWAS Revised Treaty, include the abolition of customs duties levied on imports and exports and other non-tariff barriers among Member States in order to establish a Free Trade Area in the Community. Like the other regional trade integrated area all over the world, ETLS is the foremost Trade Facilitation scheme put forward by ECOWAS in the Community. Accordingly, it was first implemented in 1979 with agricultural products, handicraft and crude products being allowed to benefit from the scheme until 1990 when it was expanded to include industrial products. Since then Nigerian companies that applied have been admitted into the scheme. Nigeria being the largest economy in the ECOWAS sub-region benefits more from ETLS till date. This is because the ETLS makes made-in-Nigeria products competitive in the ECOWAS market amidst goods from Asian and Europe. Under this scheme, company’s product registered into the ETLS in Nigeria can be exported to any ECOWAS member countries with zero duty. In the same vein, products registered into the ETLS by companies resident in any of the ECOWAS member countries can export to Nigeria with zero duty with same right of access to the market provided it is not among the products on the exempted list.

The practice is the same in all ECOWAS countries. The Enterprise completes the ETLS Applications Form electronically with details of production cost and raw materials utilized. The applications are submitted to the schedule Desk in the ministry in charge of ETLS in that country. The National Approvals Committee (NAC) in the country where the application is made meets to consider the applications from the Enterprise like in Nigeria it meets every quarter. Thereafter it proceeds for factory inspection to confirm if the information claimed in the application forms is true or false. On return from factory inspection, the forms confirmed as true are sent to ECOWAS Commission for verification. When the Commission has verified and certified the Forms okay, they will send to the Ministry for onward issuance of Certificate.

Aggressive sensitization exercise to enlighten the business public about the scheme and the need to register their products into the ETLS. Nigeria should collaborate with ECOWAS Commission as the largest economy in the sub-region to ensure full implementation of ETLS in other ECOWAS countries in order to ensure that the envisaged benefits of the scheme are fully converted to the advantage of the country.


http://www.vanguardngr.com/2016/12/nigeria-leading-beneficiary-export-liberalisation-tunde-oyelola/

Does anyone know if the US information service is giving more details as to how the applications should be sent ?

Wow ! This is great !! I think I'll give it a shot ... no harm in trying. President Obama should continue to spring up progressive initiatives like this.

Xigima: When it comes to exportation, courage is a very strong factor o. The only thing is that we live today in a totally different world. A world where courage can be mastered. What I mean is, with the amount of technology we have today and the good crop of market analysts practicing in Nigeria, one can very well read and interprete the signs of the times and so march on into the market with courage. The good thing about this is that the Nigerian government is solidly behind its exporters so it is usually quite easy to navigate through the bottlenecks when it concerns exportation epecially to Ecowas and Cemac countries. You need to listen to Dr. Aganga speak on this and you'll know how serious the government is in boosting non-oil exports.


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Nigeria Exports Non-Oil Products To 103 Countries – Aganga
LEADERSHIP EDITORS on May 3, 2012 - 7:23pm

Dr Olusegun Aganga, the Minister of Trade and Investment, says the country exports about 117 non-oil products to 103 countries annually.
Aganga said this on Thursday in Abuja at the Ministerial briefing to mark this year’s democracy day and the first anniversary of President Goodluck Jonathan’s administration.
He said that Nigeria had 5,300 products but exports only 117, adding that there was need for diversification.
``This means we have to diversify by moving to value added products, we have the market and raw materials.
``It is time to become an industrialised nation by focusing on the area where we have comparative and competitive advantage.’’
Aganga said that a new trade policy had been put in place by the administration, the first in the past 10 years, to boost Nigeria’s domestic, regional and international trade as well as facilitate the inflow of investments into the country.
He said the country had an advantage in Agriculture, which had necessitated the repositioning of the sector.
``Due to the revamping and strengthening of the Federal Produce Inspection Service (FPIS), a total of 265,588 metric tons of agricultural products were inspected.
``As a result of this, export volumes increased by 17.23 per cent and export values by 23. 9 per cent.’’
The minister said that Nigeria had attracted a lot of investments in spite of the security challenges it was presently facing as well as provided a haven for investors due to its large workforce and market in Africa.
Aganga, however, regretted that out of 84 million acres of arable land in Nigeria, only 40 per cent were being utilised.
He said he had visited over 12 countries to attract investments to Nigeria, adding that the visits had started yielding positive results.
To this end, he said, the ministry had established a trade and investment council with Australia.
According to him, efforts are being made toward establishing similar councils with other countries, including China, Qatar and Brazil.
Aganga said that an MoU had also been signed with an American firm to establish power plants that could produce 10,000 megawatts of electricity as well as assemble locomotives in Nigeria.
Earlier, the Minister of Information, Mr Labaran Maku, said that Nigeria would surmount its present security challenges and move forward as the fastest growing economy in sub-Saharan Africa.
He congratulated journalists in the country on the occasion of the World Press Freedom Day and appealed to them to ensure ``balance, probity and integrity’’ in their reportage.



http://leadership.ng/nga/articles/23631/2012/05/03/nigeria_exports_nonoil_products_103_countries_aganga.html

I totally agree with you. Any manufacturer that overcomes the "I need courage" stage, is already on his way to making it especially because of all the incentives the governement has put in place. Another major success factor is having a well experienced person or consultant leading you on. This may cost money, but it is essential in order to avoid any ugly mistake or event.

The only company based in Nigeria (Lagos) that I’ve heard of that specializes in all the activities revolving around Business Expansion, Export Sales, Export Marketing, etc from Nigeria to the French speaking countries in West and Central Africa is NELISS International. Their office is somewhere in Yaba. They’re actually very good. See if you can find them in google, then go to their website and check things out for yourself.

Yes they’re right. As a sales person, the only company in Lagos that I’ve heard of that specializes in Export Sales & Marketing to Francophone countries in West and Central Africa is NELISS International. They’re in Apapa & Yaba, somewhere near Alliance Francaise at Alagomeji, Yaba. They’re actually very good. Most people speak well of them. I worked with them in my former place of work and the guy running the company was quite professional.