Tag: export

  • China seeks more crude oil export from Nigeria

    China seeks more crude oil export from Nigeria

    China is seeking more crude oil exports from Nigeria in spite of the recent changes in oil prices, the Chinese Embassy’s Economic and Commercial Counsellor, Mr Zao  Ling Xiang, said at the weekend

    “The total amount of export to China is only about one million barrels in 2015 that was just 1.3 per cent of Nigerian annual oil export.

    “In my opinion, it really doesn’t matter whether Iran comes back or not; Chinese companies want to import more crude oil from Nigeria,” Lin Xiang said.

    The trade volume between both countries stands at $14.94 billion (2014), making Nigeria China’s third largest trade partner in Africa.

    The economic counsellor added that Nigeria’s trade figure was 8.3 per cent of China’s total trade volume with Africa and 42 per cent of the total trade volume between China and Africa.

    Besides, both countries have made “remarkable achievements” in infrastructure cooperation.

    Lin Xiang said President Muhammadu Buhari’s planned visit to China next month will facilitate the implementation of agreements reached at the 2015 China-African Summit in Johannesburg.

    He said China also sought to explore other areas of cooperation with Nigeria, adding:

    “China is the largest developing country in the world and Nigeria is the largest developing country in Africa and both countries have complementary advantages in natural and human resources, funds and markets.

    “Right now, the Nigerian Government is trying to diversify its economy, which is fully in line with the 10 China-Africa cooperation plans announced at the summit on China-Africa trade in Johannesburg in 2015.

    “There are great potential for cooperation between China and Nigeria in the fields of industrialisation, agricultural modernisation, infrastructure construction, financial services, trade and investment facilitation, among others.”

    LinXiang explained that the total investment volume between China and Africa exceeded 100 billion U.S dollars in 2015, in spite of the decline in imports from Africa.

    His words: “The amount in import from Africa to China declined but did not decline remarkably. Moreover, the economic and trade cooperation between China and Africa is not only about trade but technical cooperation as well.

    “China’s total investment volume in Africa last year increased by 100 times more in a short span of 10 years, which shows that cooperation between both parties is moving to a new level.”

  • ‘Agro allied export, cargo boost to economy’

    ‘Agro allied export, cargo boost to economy’

    If Nigeria needs to turn around its economy, it must rethink its dependence on the export of crude oil and diversify into cargo and agro allied export. Such paradigm shift will guarantee food security and create a window for Nigerian exports to Europe and the global markets where it could earn over $52 billion yearly, in addition to creating jobs. The Managing Director of ABX World, Captain John Okakpu, in this interview with KELVIN OSA-OKUNBOR speaks on these and other issues.  

    There have been calls on the government to convert some airports to cargo airport; because of the availability of agro-allied products in the area where such airports are located. Do you agree with this?

    Who goes to Akure airport? It is not the government that would go there. So, the government can designate more than 100 airports, are they the ones that will fly there? It is the private sector. The government has a lot of role to play in this part, but as far as the 13 cargo airports are concerned, they are blue-sky projects that will not work. The only airport that I can say is fit for a cargo airport in Nigeria is Ilorin. Ilorin is at the entrance and the exit point of Nigeria. But the problem with Ilorin is the road network that will take you to other areas. There is no road network. It is easier for a cargo airline to come into Nigeria, drop its cargo in Ilorin, pick some of the produce and off it goes. If you start taking a European flight to Calabar, that is crossing the airspace, when they get to Calabar, what are they dropping there? Did they have enough cargo from their origin into Calabar to go and carry whatever you say you have there?

    What does Nigeria stand to gain if it invests in agro allied products for export?

    We have over 10 million Nigerians living outside the country. Do not forget that the market is geared towards Nigerians out there, who are looking for home food and products. So, if one Nigerian spends $100 on a particular food item for a day, multiply that by how many items he will need in a week, month and a year, all through, with the amount he will be paying for these food items if they are available. The amount will be unimaginable. Nigeria is a mono-economy country, depending on only crude oil to run its budgets. We need to wake up now that the oil price has fallen to low index. This is the time to diversify the economy and invest heavily in agriculture and agro-allied products. To focus on agriculture, you need huge number of well-trained farmers, who will in turn form co-operative societies. You also need the supply chain that will get the products to their destinations, as well as warehouses, storage and packaging facilities. Our goal is to create 20 million jobs in two years, while Nigeria will be able to generate $52b annually from the export of agro allied products alone. There should not be any reason Nigerians should suffer in the midst of plenty, especially as 70 per cent of all exportable farm produce comes from Northern Nigeria.

    What are your targeted farm produce?

    We have 75 products and out of that, one of the major and the top line product exported out of Nigeria is a leaf called Ugwu, (Pumpkin). You cannot believe that today if you bring a 40-feet container full of Ugwu, it will go on a daily basis. That is one of the high products out of Nigeria. The list goes on; Ugwu is there, bitter leaf is there, sweet potato, ginger, and garlic.

    How do you preserve them for export?

    We don’t preserve them, ours is transportation. We have experts who  do that. For example, ours is to take it from Nigeria to Europe. They get it fresh. If you go to SAHCOL, which is our processing centre, I can proudly tell you that today SAHCOL built first class world standard warehouse. And the cold room they have there today is only ABX world that is making use of it because of the dimension we are taking Nigeria to.

    Preservation is not our goal; our goal is logistics, bring in supply chain, get the farmers, put them together to be trained and certified.

    We all know today that brown beans is banned from Nigeria, you can’t take it into Europe because of the chemical used in preservation. Then in terms of cassava peel, nothing out of cassava is a waste, including the peel. If you bring 100 container of cassava peel, it will go the same day from Nigeria.

    Crude oil prices are failing and one of its spiral effects is the huge cut in revenue accruing to the government. How did we get to this stage?

    Fundamentally, as a government and a people we got it all wrong many years and decades ago when we solely depended on crude oil export as the mainstay of the economy. No reasonable government or a nation will do that considering that it would have attendant effects on her economy. Now, the reality has hit us economically and we are running around. It is time to stop complaining and strategise to move ahead. It is time government launched a serious return to the land campaign, by that I mean agriculture. That is why our firm is interested in the promotion of cargo and agro allied export.

    How does your cargo freighting and handling firm fit into this?

    My goal here is to bring Nigeria back to where we are supposed to be. To stimulate the promotion of cargo and agro allied export. It was a very painful task and journey; it has taken a lot of time and hard work, but the bottom line is that we are here now in Nigeria. In ABX world, our goal is to champion agro airline in Nigeria to create a revolution. Agro Allied has to do with agricultural products, in conjunction with transportation and logistics, mostly in aviation.

    Why did it take us this long to realise we have to go back to agro allied and cargo export promotion?

    You know the price of crude oil in the market today. Nigeria is one dimension economy, mono-economy, crude oil and import, that is it. God wants to redirect Nigeria. That is why we are now facing the issue of crude oil and falling price by the day. People like me will say let the crude oil be zero, one dollar per barrel because that will wake us up from the slumber.

    For Nigeria to balance its budget, crude oil has to be sold at a higher price per barrel. How do we make up for the difference?

    We have no choice than to go back to basics, which is agriculture. At ABX World, we have partners in Europe, around the world, we are here to make a difference, create agricultural revolution whereby we take agricultural products as long as they meet the international standard and requirements to the world.

    What strategies do you have in place to achieve good marketing of Nigerian products in Europe and other continents?

    First of all we have to engage a lot of supply chains around the world, especially in Europe because about 60 per cent of what is going out of Nigeria will target the market in Europe. What we do is to engage a lot of supply chain, bring in the supply chain, then try and liaise with the government, both state and federal and get the farmers, through their co-operative societies because most of these farmers have to be fully registered through their co-operative societies. And these farmers have to be trained on the dos and the don’ts involved in what they are into. When you bring in the farmers, you bring in the co-operative societies, then you put both of them together to be trained and certified to be able to supply the products they are into. Once you get certified you can be guaranteed about three years contract. So there is a need for the training and certification, which is the most basic.

    What is your take on efforts by the government to construct 13 cargo airport terminals across the country?

    There are some airports designated as cargo airports in Nigeria, but to me I will call that blue-sky project. What I mean by blue-sky project is that it will never work. I had some meeting with FAAN officials about two, three times in the past months and I gave them reasons why it will never work. Part of the reasons is that the projects were poorly conceptualised. The world is changing. Most of the aircraft manufacturers are changing their direction. There will be a time you will not have a cargo airline because of the new trend in technology in aircraft manufacturing. For example, Emirate is taking the lead in this direction. Some time ago Emirate ordered for a hundred and fifty Boeing 777-300ER. This aircraft takes over 400 passengers, takes their luggage plus their excess and still have the capacity to carry 30 tonnes of cargo on two engines. If you designate 13 airports in Nigeria as cargo airports, then you have to ask yourself if it is viable for cargo airline to fly there. The world is changing so much so that most of the passenger terminals have to be the cargo terminals because most of these agricultural produce have to be moved on daily basis. When you harvest them they are moved immediately to their destination within 18 hours. You cannot tell me you load a British Airways with full passengers then you tell them to stop at Enugu to carry five tons of cargo because Enugu is designated as cargo terminal. It does not make any sense.

  • Organic produce for export

    Organic produce for export

    By using bio-fertiliser, farmers are reviving land and boosting the nation’s agro exports prospect, Daniel Essiet writes.

    While many farmers are battling to survive, because of the financial challenge of setting up a modern farm, organic farming method is helping Herny Adigun, chief executive, Yomex Organic Farm, to succeed.

    He uses organic fertiliser, mostly green manure. This helps to provide moisture and nutrients. When he began, his knowledge of farming was not much.  Yet his willingness to learn and hard work have paid off handsomely – and he is an example to emerging farmers everywhere.

    Yomex Organic Farm based in Lagelu Local Government Area of Oyo State,  showcases Adigun’s efforts to make his 16-acre farmland a self-sufficient organic.

    The farm is one of the largest in the area, with tomatoes, cucumber and vegetables on three acres of land. Besides growing vegetables, Adigun has spacious sheds for poultry and goats. The peculiarity of the farm is its self sufficiency in every aspect, including manure production, and its solar power unit to generate its own electricity is nearing completion.

    At the pace he is going, he could begin the process of applying for Good Agricultural Practices (GAP) certification or any international certification as an organic grower. Although his farm is not yet ‘official’, he regards his operation as 100 per cent organic.

    While exploring various business ventures, he hit upon organic farming as having a promising growth potential. He foresees a tremendous growth in the demand for organic food in the next few years.

    With activities of farmers, such as Adigun, organic production,  has taken off successfully. Companies involved in organic farming are mostly export oriented.

    In the last 20 years, a lucrative international market for organic cocoa, spices, vegetables and coffee has attracted more farmers into organic farming.

    This is because the demand for such produce in the United States, Europe and Asia far outstrips domestic supply.

    The major organic produce importing countries are the United Kingdom, the United States, China, India, Germany and the Netherlands.

    A member of the Nigeria Vietnam Business Council, Mr Sunday Anjorin, said European and Asian markets offer good business opportunities for Nigerian organic companies that want to export their products.

    According to Anjorin, supermarkets, food and pharmaceutical companies are channels for organic produce.

    Others include bakeries, health food shops, specialised organic shops, fast food restaurants and delivery services.

    He said organic spices and herbs were in demand in India.

    So far, Germany is Europe’s largest market for organic products, with a sales volume of €5.8 billion and an average growth of 15 per cent yearly.

    Indeed, food exports are vital to Nigeria’s economy, and increasing participation in organic farming by exporters is a welcome boost to the already strong and expanding sector.

    Gradually, the ranks of certified organic farmers is swelling with the Nigerian Organic Agriculture Network (NOAN), an association that unites farmers, processors, exporters and organisations promoting the practice.

    To experts and farmers, as organic farming drives growth in productivity, it  also allows farmers to get the most out of soil.

    While health-conscious consumers worldwide are providing valuable new organic export markets, most Nigerian farmers are finding it challenging meeting necessary certifications and other requirements to take advantage of the growing popularity of organic foods in industrialised countries.

    In most cases, new entrants incur higher costs applying new organic techniques without the higher prices associated with organic label.

    Most importantly, the European Union (EU) legislation requires that imported organic foods are produced to the same standards as that from the UK or EU.

    On the average, and to win certification, a farm must stop using most pesticides and make other changes, then maintain those practices for three years.

    Going organic is governed by strict government standards, which require that products bearing the organic label are made without the toxic and persistent pesticides, synthetic nitrogen fertilisers, antibiotics, synthetic hormones, genetic engineering or other excluded practices, sewage sludge, or irradiation. Beyond this, producers and processors are expected to register with an EU-approved organic control body, and subject to the import controls for organic produce.

    While farmers are struggling to comply with the high-level standards needed to meet certification requirements, the EU in June banned some of the nation’s food items. They included beans, sesame seeds, melon seeds, fried fish, meat and peanut chips, among others, from entering Europe till June this year.

    According to the European Food Safety Authority, the rejected beans were found to contain between 0.03mg per kg to 4.6mg/kg of dichlorvos pesticide. The acceptable maximum residue limit is 0.01mg/kg.

    Addressing a forum in Lagos, the Chairman, Agro-Commodity Export Group of the Lagos Chamber of Commerce and Industry (LCCI), Dr Obiora Madu, said it was imperative for the government to resolve the issue before the June deadline given by the EU to correct the anomaly.

    ”Yes, there are a lot of export markets beyond Europe but if we do nothing, it is likely to escalate at the same time as other nations join the EU to reject our produce again we are in trouble.

    “As a chamber, we are concerned about the trend and are actively at the forefront of sensitising farmers and exporters on compliance to international standard for our produce.”

    According to him, food safety implies the absence or acceptable and safe levels of contaminants, adulterants, naturally-occurring toxins or any hazard that may make food injurious to health.

    In an interview, Madu noted that the organic export market is growing because of awareness on the dangers of pesticide residues in food and growing disposable incomes of the urban middle classes.

    He said organically-grown products don’t have problems because producers don’t use pesticides.

    Madu observed that the EU market is one of the toughest to supply because the technical, ethical, quality and packaging standards are so high.

    This, notwithstanding, the successful exporters expect buyers to pay a premium for the extra certification and the quality and size standards; however, they are increasingly finding that the EU is still paying lower prices.

    For some exporters, there are still opportunities in the world, including the EU, which makes it attractive to new exporters.

    With Nigeria like South Africa in its ability to produce diverse agro product ranges, he sees a bright future for aspiring exporters.

    Madu stressed the need for collaborative efforts of regulatory authorities and stakeholders in formulating a framework to address the challenges of the agricultural produce in the international market

    There are programmes to help farmer groups and small exporters overcome the challenges and take advantage of the remunerative markets. The programmes are designed to increase their technical skills and improve product quality, which will enable them to obtain organic and fair-trade certification.

    Some of the programmes focus on stages of the supply chain from production, harvesting and packaging to certification and marketing. The vital part is to pay for the costly certification  and comply with high international quality standards.

    On the issue, NOAN President Prof Victor Idowu Olugbemiga Olowe said the group was at the forefront of helping farmers to meet standards for certification.

    To make them competitive, he said organic farmers, processors and traders must comply with strict requirements if they want to use organic logo or label their products as organic. He noted that farmers face a number of obstacles in exporting their products, including meeting buyers’ demands on quality, requirements and standards.

    According to him, importers require agro exports to have certification. The organic product labels  should bear the name of the producer. The advantage of certification, Olowe noted, is that the exporters are able to brand their goods as “certified organic, not just organic” which would increase value.

    NOAN, he argued, is striving to assist farmers to adopt organic agriculture as a model for sustainable food and farming.

    One way to achieve this is through a national system certification that demonstrates sustainable production practices and meets food safety practices.

    According to him, independent validation of sustainability and quality claims is crucial for organic growers to market their produce.

    Globally, the major problem in the organic market is a large number of logos and brands, which confuses many consumers and potential buyers of organic products; and probably has a limiting effect on growth over several years. The other challenge is that exporters are expected to prove with documentation that their produce have fair trade certification.

  • Making non-oil export economy’s heartbeat

    Making non-oil export economy’s heartbeat

    Can the Export Rediscounting and Refinancing Facility (ERRF) and the Non-Export Stimulation Facility (NESF) achieve their aims? Yes, they can, argue  experts, who note that the programmes can boost non-oil export and facilitate diversification of the economy, if properly driven by the government. Assistant Editor CHIKODI OKEREOCHA reports.

    They are coming at an auspicious time. The  Export Rediscounting and Refinancing Facility (RRF) and Non-oil Export Stimulation Facility (ESF) designed to stimulate non-oil export are coming when the economy is, perhaps, at its most vulnerable ever. They are coming in the heat of the crisis in the international oil market where the price of crude has been crashing, requiring urgent rejuvenation of the non-oil export sector as a wedge.

    Nigeria depends on oil for 70 per  cent and 95 per cent of her revenue and foreign exchange earnings. But global oil prices have been tumbling since June 2014, putting the finances of Africa’s largest economy/oil producer under severe pressure. From over $120 per barrel in December 2013, oil price nose-dived to around $60 per barrel in December 2014. By December 2015 and January 2016, oil price crashed to as low as $32 per barrel and $27 per barrel, respectively.

    Although, oil price went up slightly above  $30 per barrel, Tuesday this week, the unprecedented fall in oil prices necessitated strident calls on the Federal Government to speed up the development of the non-oil sector and the diversification of the economy to mitigate the impacts made worse by over-dependence on proceeds from crude oil. The new export financing programmes are therefore, seen as indication that the Federal Government may have finally seen the wisdom in reducing the country’s over reliance on export of crude oil as a major source of revenue, which price is prone to volatility.

    The Federal Government through the Central Bank of Nigeria (CBN) said last week that it has designed two export financing programmes known as RRF and ESF to improve non-oil export in the country and achieve total diversification of the economy. The move is seen by not a few experts and stakeholders as a short in the arm of real sector operators especially those in the non-oil export business,

    CBN Governor Godwin Emefiele, who made the initiative known in Abuja at the non-oil exports stimulation conference organised by the apex bank and the Nigerian Export-Import Bank (NEXIM), said the CBN and NEXIM came up with the initiative to encourage exporters expand their businesses as well as provide a pool of funds for commercial banks to enable them support exporters.

    According to Emefiele, credit to the non-oil export sector is currently in the decline, constituting a paltry 0.6 per cent of total domestic credit to the private sector in the past five years, while domestic credit to the economy has been on the rise. He blamed low level of export loans for being largely responsible for the decline in non-oil export revenue receipts from $10.53 billion in 2014 to $4.39 dollars in 2015.

    “The impact of these developments on the country’s export growth potentials is quite significant and has become instructive for stakeholders to dialogue on strategies to expand resources for export,” the CBN boss said, adding that the decline also limited the sector’s contribution to foreign reserve accretion.

    Emefiele said volatility in the international oil market s necessitated the renewed focus on non-oil exports as panacea to the nation’s dwindling foreign reserves. He noted that a rejuvenated non-oil export would stimulate economic growth and development, address the challenges of unemployment and target economic rebirth through the diversification of the Nigerian economy.

    At the conference themed ‘Strategies for Growing Nigeria’s Non-Oil Exports,’ Emefiele pledged that CBN will continue to play a catalyst role in improving export and encouraging local production through collaboration with the Ministry of Agriculture.

    Throwing  more light on the new facilities’ NEXIM Managing Director, Mr. Robert Orya, said the funds would be provided to all banks that lend to the export sector and that the banks would be mandated to give loans to exporters at nine per cent maximum. “If a commercial bank gives you a loan to say that you will return it in a year, the bank will not have money to loan out until you return that money.

    “But this window is such that as soon as this money is given to you, they will bring the credit papers and we refinance and give them the same money that they have given you, so they can give to another person. As soon as they finish disbursing to that person, they will bring the credit papers to us again and we will be able to refinance,” he explained.

    Orya emphasised that the facility is to encourage banks to lend by providing liquidity for them and to also enable them give the non oil facility at a moderated rate. He also said CBN and NEXIM would soon meet to finalise on the quantum of funds to be provided for the facilities and also the modalities for the disbursement.

    At the conference, which attracted about 400 participants across all stakeholders in the non-oil sector, the NEXIM MD said the funding would also aid exporters to improve on quality standards, packaging issues, export productions and operational challenges.

    Indeed, lack of quality control measures has been one of the greatest pains in the neck of exporters, which was why CBN’s latest intervention is music in their ears. “Quality is number one. It is the first thing that ought to be considered as the nation focuses on building a robust export-based economy,” the National President, Association of Systems Management Consultants, Mazi Coleman Obasi, said.

    While describing the initiative as a welcome development, the certified Quality Management Practitioner told The Nation that there is need for the authorities to speed up the adoption of the draft document for the proposed National Quality Policy (NQP) for Nigeria. He wondered why the formulation and subsequent adoption of the document is being delayed despite the fact that the European Union (EU) made available 12 million Euros about two years for the establishment of a National Accreditation System in Nigeria.

    He said the fund was supposed to support the enhancement of the national quality infrastructure, with a view to improving the quality, safety, integrity, and marketability of made in Nigeria goods and services. According to him, the intervention by the EU and other international technical partners was to increase the competitiveness of locally made products at the international market place.

    Under the EU-funded National Quality Infrastructure (NQI) project, implemented by the United Nations Industrial Development (UNIDO), with the support of the Federal Ministry of Industry, Trade and Investment, the objective was to improve the quality of products made in Nigeria so that they can be sold internally and in the international market. It was supposed to help develop a National Metrology Institute (NMI) to ensure that instruments are of international standards, improve the capacity of members of the Organised Private Sector (OPS) to conform to standards.

    The initiative, which was expected to produce a legislation that will contain a NQP and establish an internationally recognized National Accreditation Body (NAB) that will vet the activities of regulatory agencies such as the Standards Organisation of Nigeria (SON) and the National Agency for Foods, Drugs Administration and Control (NAFDAC).

    It will also establish conformity assessment bodies as well as enhance the powers of the Consumer Protection Council (CPC) and other consumer organisations to sensitize consumers on quality standards, and ensure improved consumer protection. But these have so far not happened. Yet, experts say that the creation of these key systems and institutions are supposed to boost the competitiveness of locally made products at the international market place and ensure the global acceptance of products and services from Nigeria.

    Failure by exporters to comply with specified standards is said to be responsible for mass rejection of non-oil exports from Nigeria at entry points in many countries in Europe. The Nation learnt that the rejected exports are mostly in the food and beverage segment where items such as beans, sesame seeds, melon seeds, fried fish, meat, peanut chips and palm oil are said to have been banned from entering Europe till June 2016.

    Non-oil products such as cocoa and cashew nuts were also rejected in many other countries, not only in Europe, with the importing countries citing  exporters’ inability to adhere to global standards, poor packaging, and high level of chemicals, poor labeling, insufficient information on nutritional content, and presence of high level of pesticide residue and presence of Mycotoxins.

    While admitting that lack of quality control measures remains a major hurdle on Nigeria’s quest to ride on the back of a robust non-oil export sector to grow and diversify the economy, the Chairman, Export Group, Lagos Chamber of Commerce and Industry (LCCI), Mr. Obiora Madu, identified other challenges facing non-oil exporters to include lack of incentives, logistics/infrastructure deficiency, and high cost of doing business.

    The Director General, Nigerian Economic Summit Group (NESG), Mr. Laoye Jaiyeola, said although policies to address the constraints of the non-oil sector abound, there is need to harmonise and properly implement them to ensure that they work. “People want to invest in the non-oil export sector, but our institutions and infrastructure must be right, our monetary policies must be consistent and macro economy level stable. But we scare them when we say one thing today and another tomorrow,” he said.

    Jaiyeola said the non-oil sector was fundamental to economic diversification, rapid revenue base expansion, sustainable growth and employment generation. He therefore, advised government to harmonise its non-oil export stimulation policies and ensure consistency in the administration of intervention funds to non-oil exporters.

    The Federal Government’s RRF and ESF are additions to previous policy interventions aimed at giving impetus to the emphasis on the non-oil sector in the face of the economic downturn caused by plunging oil prices. Recall that last year, the Federal Government gave vent to its push for economic diversification when it listing 13 National Strategic Export Products (NSEP) to replace oil. The 13 NSEP were listed in three categories including; agro-industrial- palm oil, cocoa, cashew, sugar and rice); mining related- cement, iron ore/metals, auto parts/cars, aluminium and oil and gas industrial products- petroleum products, fertilizer/urea, petrochemical and methanol.

    The former Minister of Industry, Trade and Investment, Dr. Olusegun Aganga, said then that Nigeria could no longer continue to be an import-dependent country. According to him, the nation was wasting its foreign reserves on imported products most of which can be produced locally.

    The Executive Director of Nigerian Exports Promotion Council (NEPC), Mr. Olusegun Awolowo, also said NEPC under his leadership had long recognised the need to develop the non-oil export sub-sector and had in the process held series of strategic meetings with stakeholders for the development of ideas aimed at improving the foreign exchange earnings by Nigeria through different avenues.

    These, he said, include the development of a 4-year Strategic Plan, One State One Product (OSOP), Nigerian Diaspora Export Programme (NDEX) and the development of new markets for new products. But as highly commendable as govern-ment’s moves to diversify the economy by riding on the back of non-oil export are, the political will to carry such policies to their logical conclusion remains the challenge.

    While real sector operators have thrown their weight behind the emphasis on non-oil economy, insisting that it is more inclusive, growth-oriented and characterized by high economic linkages and more sustainable, the consensus is that the success of the latest initiative, like previous ones, depends on the extent government demonstrates political will to carry them through.

  • Making non-oil export economy’s heartbeat

    Making non-oil export economy’s heartbeat

    Can the Export Rediscounting and Refinancing Facility (ERRF) and the Non-Export Stimulation Facility (NESF) achieve their aims? Yes, they can, argue  experts, who note that the programmes can boost non-oil export and facilitate diversification of the economy, if properly driven by the government. Assistant Editor CHIKODI OKEREOCHA reports.

    They are coming at an auspicious time. The  Export Rediscounting and Refinancing Facility (RRF) and Non-oil Export Stimulation Facility (ESF) designed to stimulate non-oil export are coming when the economy is perhaps, at its most vulnerable ever. They are coming in the heat of the crisis in the international oil market where the price of crude has been crashing, requiring urgent rejuvenation of the non-oil export sector as wedge.

    Nigeria depends on oil for 70 per  cent and 95 per cent of her revenue and foreign exchange earnings. But global oil prices have been tumbling since June 2014, putting the finances of Africa’s largest economy/oil producer under severe pressure. From over $120 per barrel in December 2013, oil price nose-dived to around $60 per barrel in December 2014. By December 2015 and January 2016, oil price crashed to as low as $32 per barrel and $27 per barrel, respectively.

    Although, oil price went up slightly above  $30 per barrel, Tuesday this week, the unprecedented fall in oil prices necessitated strident calls on the Federal Government to speed up the development of the non-oil sector and the diversification of the economy to mitigate the impacts made worse by over-dependence on proceeds from crude oil. The new export financing programmes are therefore, seen as indication that the Federal Government may have finally seen the wisdom in reducing the country’s over reliance on export of crude oil as a major source of revenue, which price is prone to volatility.

    The Federal Government through the Central Bank of Nigeria (CBN) said last week that it has designed two export financing programmes known as RRF and ESF to improve non-oil export in the country and achieve total diversification of the economy. The move is seen by not a few experts and stakeholders as a short in the arm of real sector operators especially those in the non-oil export business,

    CBN Governor Godwin Emefiele, who made the initiative known in Abuja at the non-oil exports stimulation conference organised by the apex bank and the Nigerian Export-Import Bank (NEXIM), said the CBN and NEXIM came up with the initiative to encourage exporters expand their businesses as well as provide a pool of funds for commercial banks to enable them support exporters.

    According to Emefiele, credit to the non-oil export sector is currently in the decline, constituting a paltry 0.6 per cent of total domestic credit to the private sector in the past five years, while domestic credit to the economy has been on the rise. He blamed low level of export loans for being largely responsible for the decline in non-oil export revenue receipts from $10.53 billion in 2014 to $4.39 dollars in 2015.

    “The impact of these developments on the country’s export growth potentials is quite significant and has become instructive for stakeholders to dialogue on strategies to expand resources for export,” the CBN boss said, adding that the decline also limited the sector’s contribution to foreign reserve accretion.

    Emefiele said volatility in the international oil market s necessitated the renewed focus on non-oil exports as panacea to the nation’s dwindling foreign reserves. He noted that a rejuvenated non-oil export would stimulate economic growth and development, address the challenges of unemployment and target economic rebirth through the diversification of the Nigerian economy.

    At the conference themed ‘Strategies for Growing Nigeria’s Non-Oil Exports,’ Emefiele pledged that CBN will continue to play a catalyst role in improving export and encouraging local production through collaboration with the Ministry of Agriculture.

    Throwing  more light on the new facilities’ NEXIM Managing Director, Mr. Robert Orya, said the funds would be provided to all banks that lend to the export sector and that the banks would be mandated to give loans to exporters at nine per cent maximum. “If a commercial bank gives you a loan to say that you will return it in a year, the bank will not have money to loan out until you return that money.

    “But this window is such that as soon as this money is given to you, they will bring the credit papers and we refinance and give them the same money that they have given you, so they can give to another person. As soon as they finish disbursing to that person, they will bring the credit papers to us again and we will be able to refinance,” he explained.

    Orya emphasised that the facility is to encourage banks to lend by providing liquidity for them and to also enable them give the non oil facility at a moderated rate. He also said CBN and NEXIM would soon meet to finalise on the quantum of funds to be provided for the facilities and also the modalities for the disbursement.

    At the conference, which attracted about 400 participants across all stakeholders in the non-oil sector, the NEXIM MD said the funding would also aid exporters to improve on quality standards, packaging issues, export productions and operational challenges.

    Indeed, lack of quality control measures has been one of the greatest pains in the neck of exporters, which was why CBN’s latest intervention is music in their ears. “Quality is number one. It is the first thing that ought to be considered as the nation focuses on building a robust export-based economy,” the National President, Association of Systems Management Consultants, Mazi Coleman Obasi, said.

    While describing the initiative as a welcome development, the certified Quality Management Practitioner told The Nation that there is need for the authorities to speed up the adoption of the draft document for the proposed National Quality Policy (NQP) for Nigeria. He wondered why the formulation and subsequent adoption of the document is being delayed despite the fact that the European Union (EU) made available 12 million Euros about two years for the establishment of a National Accreditation System in Nigeria.

    He said the fund was supposed to support the enhancement of the national quality infrastructure, with a view to improving the quality, safety, integrity, and marketability of made in Nigeria goods and services. According to him, the intervention by the EU and other international technical partners was to increase the competitiveness of locally made products at the international market place.

    Under the EU-funded National Quality Infrastructure (NQI) project, implemented by the United Nations Industrial Development (UNIDO), with the support of the Federal Ministry of Industry, Trade and Investment, the objective was to improve the quality of products made in Nigeria so that they can be sold internally and in the international market. It was supposed to help develop a National Metrology Institute (NMI) to ensure that instruments are of international standards, improve the capacity of members of the Organised Private Sector (OPS) to conform to standards.

    The initiative, which was expected to produce a legislation that will contain a NQP and establish an internationally recognized National Accreditation Body (NAB) that will vet the activities of regulatory agencies such as the Standards Organisation of Nigeria (SON) and the National Agency for Foods, Drugs Administration and Control (NAFDAC).

    It will also establish conformity assessment bodies as well as enhance the powers of the Consumer Protection Council (CPC) and other consumer organisations to sensitize consumers on quality standards, and ensure improved consumer protection. But these have so far not happened. Yet, experts say that the creation of these key systems and institutions are supposed to boost the competitiveness of locally made products at the international market place and ensure the global acceptance of products and services from Nigeria.

    Failure by exporters to comply with specified standards is said to be responsible for mass rejection of non-oil exports from Nigeria at entry points in many countries in Europe. The Nation learnt that the rejected exports are mostly in the food and beverage segment where items such as beans, sesame seeds, melon seeds, fried fish, meat, peanut chips and palm oil are said to have been banned from entering Europe till June 2016.

    Non-oil products such as cocoa and cashew nuts were also rejected in many other countries, not only in Europe, with the importing countries citing  exporters’ inability to adhere to global standards, poor packaging, and high level of chemicals, poor labeling, insufficient information on nutritional content, and presence of high level of pesticide residue and presence of Mycotoxins.

    While admitting that lack of quality control measures remains a major hurdle on Nigeria’s quest to ride on the back of a robust non-oil export sector to grow and diversify the economy, the Chairman, Export Group, Lagos Chamber of Commerce and Industry (LCCI), Mr. Obiora Madu, identified other challenges facing non-oil exporters to include lack of incentives, logistics/infrastructure deficiency, and high cost of doing business.

    The Director General, Nigerian Economic Summit Group (NESG), Mr. Laoye Jaiyeola, said although policies to address the constraints of the non-oil sector abound, there is need to harmonise and properly implement them to ensure that they work. “People want to invest in the non-oil export sector, but our institutions and infrastructure must be right, our monetary policies must be consistent and macro economy level stable. But we scare them when we say one thing today and another tomorrow,” he said.

    Jaiyeola said the non-oil sector was fundamental to economic diversification, rapid revenue base expansion, sustainable growth and employment generation. He therefore, advised government to harmonise its non-oil export stimulation policies and ensure consistency in the administration of intervention funds to non-oil exporters.

    The Federal Government’s RRF and ESF are additions to previous policy interventions aimed at giving impetus to the emphasis on the non-oil sector in the face of the economic downturn caused by plunging oil prices. Recall that last year, the Federal Government gave vent to its push for economic diversification when it listing 13 National Strategic Export Products (NSEP) to replace oil. The 13 NSEP were listed in three categories including; agro-industrial- palm oil, cocoa, cashew, sugar and rice); mining related- cement, iron ore/metals, auto parts/cars, aluminium and oil and gas industrial products- petroleum products, fertilizer/urea, petrochemical and methanol.

    The former Minister of Industry, Trade and Investment, Dr. Olusegun Aganga, said then that Nigeria could no longer continue to be an import-dependent country. According to him, the nation was wasting its foreign reserves on imported products most of which can be produced locally.

    The Executive Director of Nigerian Exports Promotion Council (NEPC), Mr. Olusegun Awolowo, also said NEPC under his leadership had long recognised the need to develop the non-oil export sub-sector and had in the process held series of strategic meetings with stakeholders for the development of ideas aimed at improving the foreign exchange earnings by Nigeria through different avenues.

    These, he said, include the development of a 4-year Strategic Plan, One State One Product (OSOP), Nigerian Diaspora Export Programme (NDEX) and the development of new markets for new products. But as highly commendable as govern-ment’s moves to diversify the economy by riding on the back of non-oil export are, the political will to carry such policies to their logical conclusion remains the challenge.

    While real sector operators have thrown their weight behind the emphasis on non-oil economy, insisting that it is more inclusive, growth-oriented and characterized by high economic linkages and more sustainable, the consensus is that the success of the latest initiative, like previous ones, depends on the extent government demonstrates political will to carry them through.

  • Expert tasks govt on non-oil export

    Expert tasks govt on non-oil export

    A certified international trade professional and President, Koinonia Global Services with headquarters in Canada, Mr. Olufemi Boyede, has lamented government’s continuous neglect of the non-oil sector.

    He said the economy will continue to slide if the over-reliance on oil sector continues.

    Boyede spoke against the background of the nation’s economy in the face of dwindling oil returns.

    He noted that the starting point for the revival of the nation’s economy is for government to appreciate that the only alternative to the depleting foreign exchange is popping up the non-oil sector of the economy.

    Giving the example of the US, he said, “Obama in 2010 introduced the Obama Export Initiative in the US. This later became the National Export Initiative and was recently extended to 2020 as the National Export Initiative Next.

     “This was based on Obama’s  understanding and acknowledgement of the fact that in order to survive the economic recession, America needed to double her exports to the world over the five years 2010-2014 and through exports, create five million jobs.

    “There is a need for Nigeria to visit that export document and replicate what the US did if we really want to move forward.”

    While noting that solving the problem of Nigeria is not about sweet talks, he said the 1993 report of the World Bank on the Asian Tigers indicated that government of those countries deliberately introduced policies that favoured local industrial revolution

    According to him, “The situation at hand requires immediate action, impactful action and result-oriented action. I expect that the Minister for Solid Minerals, Dr. Kayode Fayemi to create a platform whereby the impact in that sector could be measured.

    “We would like to see the amount of forex inflow from that sector in, say, twelve months. The minister must go out aggressively to secure willing investors who will brave all the current challenges to follow him back to Nigeria to start exploring and exporting our gold.”

  • Group targets N80b from cashew export

    •Committees to achieve target inaugurated

    The National Cashew Association of Nigeria (NCAN) is targeting about N80 billion from cashew export this year, its spokesman, Mr. Sotonye Anga, has said.

    Anga told News Agency of Nigeria (NAN) on the sideline of the ‘Second Annual Cashew Logistics Meeting’ in Lagos that shipping lines had recognised cashew as revenue generating cash crop and contributor to the country’s economy.

    Noting that shipping firms account for more than 80 per cent of exported cargoes from Nigeria, he said: “There is need for improvement in the handling of cashew, which will propel significant improvement in the country’s economic performance.

    “Shipping lines have recognised the economic relevance of cashew and that is why you can see their chief executives and decision makers represented at this meeting. “The meeting will afford the association opportunity to take steps to advance Nigeria’s cashew export to destinations like India, Vietnam, China, Middle East, Europe, U.S. and others.”

    The NCAN spokesman, who said the association believed in strong bond between it and the shipping lines, stated that “We expect that Nigeria should generate about N80 billion from cashew export in 2016 season and trade in a manner that will impact on the value chain.”

    He said NCAN would leverage on this relationship to ensure that  the year cashew exports is hitch-free. “We will have zero claims because of damages to cashew cargo when containers are well dressed with adequate number of desiccants and Kraft papers,” he said.

    The Export Manager of Safmarine, Mrs. Maureen Okojie, said decisions on shipping services were time bound. She stressed the need to look at shipment schedule between February and July, this year for cashew shipments.

    An official of COSCO Shipping Company, Mr. Paulinius Effiong, advised forwarding agents to reject containers with holes.

    To realise the association’s target of raking in N80b from cashew export this year, its President, Tola Faseru, inaugurated two committees to ensure a hitch-free 2016 cashew season. He named the committees as the Cashew Logistics Committee and the Cashew Improvement Committee.

    The committees are saddled with  implementing programmes for the the season.

    Cashew shipping firms, exporters, forwarders and shipping lines were represented at the conference.

  • NEPC briefs Osinbajo on non-oil export plan

    NEPC briefs Osinbajo on non-oil export plan

    The Executive Director/CEO, Nigeria Export Promotion Council (NEPC), Olusegun Awolowo, yesterday briefed the Vice President, Prof Yemi Osinbajo, on its plans to boost non-oil exports.

    He briefed the Vice President when he visited him in his office at the Presidential Villa, Abuja. He said the visit was to get the Vice President to buy into NEPC’s new plan  tagged-Zero Oil Plan.

    Speaking with State House correspondents at the end of the meeting, he said: “This is a plan that we think will really help Nigeria out of the doldrums we now face; we are facing a drop of revenue of over $30 billion. Our revenue on oil has fallen from $70billion to almost $40 billion; that alone can kill a country if we are not careful.

    “We are the apex agency for the promotion of non-oil products in Nigeria. So we have come up with this Zero Oil Plan which we are getting the stakeholders’ buy-in all over, and which our Minister will formally come and present to Mr President.”

  • ‘How to increase export market share’

    ‘How to increase export market share’

    The government should capitalise on the potential  of organic agriculture, improve product quality and packaging to capture a larger share of the export market, Niger State Coordinator, Mr. Hussaini Iliyasu, the Agriculture Graduates Association of Nigeria (AGAN), has said.

    Iliyasu,who gave the advice in Minna, the Niger State capital, during a forum tagged: Farmers’ Field Day, said there was a growing demand for organic products, adding that farmers could explore it.

    He said: “Going back to nature in food production as the alternative means in sustainable food security considering the benefit inherent in it are what motivated AGAN to demonstrate rice using organic/bio-fertiliser in collaboration with Contec Global Agro.”

    On the successes of the products, Iliyasu said: “The farmers’field day is to bring into limelight the achievements of farmers whose crop was under demonstration plots for analysing the efficacy of bio-fertiliser and bio-pesticides.”

    Continuing, he said: “There were 30 plots; one hectare each in five different villages. The results have been very impressive. Harvesting has started, and from the less than three tonnes per hectare, we are getting more than six tonnes, as we have experienced on the average, 70 tillers per plant as compared to 35-40 tillers per plant we were getting while using the conventional chemical fertiliser.

    “So, we are assured of increased economic yields per hectare of five to six tonnes per hectare compared to 1.5 – 1.8 tonnes per hectare that an average conventional farmer is getting.”

    Also, the representative of the farmers who participated in the experimentation, Alhaji Mohammed Mahmoud, said: “The evidence is there in the field for all to see and feel. I have farming neighbours who use the conventional products. They get on the average, 40 tillers per plant, whereas I get up to 60-70 tillers per plant.

    “You can see (pointing to his field) that there are no symptoms of insect infestation on my farmland. And very importantly, using the products has helped in cutting down the cost of production for us to as much as 60 per cent as against the past.”

    He said the time between planting and harvest was significantly reduced to less than four months as against the six months for conventional farming.

    Managing Director, Contec Global Agro, Mr. Thomas Chackunkal, said the product makes farming more  lucrative, saying: “The use of bio-fertiliser and bio-pesticides would help to, ultimately, give life to the soil, give the farmers lesser financial stress and ensure that the people eat very healthy foods.”

    He said Contec Global Agro has acquired a research centre in Abuja, where researches on organic farming and other cutting-edge agricultural procedures would be explored for the benefit of farmers.”

    This, he said, would add to similar efforts2 to make Nigeria an agriculture research hub for Africa.

    On the firm’s plan, he said: “We have started with rice, but we are also aware that many other crops are grown in Nigeria, which is why we have gone into partnerships with the National Cereals Research Institute (NCRI) in Plateau State, and other stakeholders to ensure that every crop is covered.

    “We are also working towards making our products available in the coming days for dry season farming, just as we have concluded plans to bring in small hand-held easy-to-use devices that could help farmers with irrigation farming.”

    According to him, Contec Global Agro is the first company in Nigeria to set up a microbiology lab and factory for commercial production of bio-fertiliser, growth enhancers and plant protection biologicals.

    “We are following a strong dealer network for our product distribution. So far, we have around 35 dealers located in eight states, including Kano, Kaduna, Katsina, Zamfarra, Sokoto,Taraba, Plateau and Nasarawa.

    “The company’s vision is to be a pioneer in offering key solutions to farming community right from seed till harvest through usage of our safe and organic products.

    “We are also initiating farmers to form small clusters and other associations so that larger sections can be reached while disseminating the information about product and their usage, along with good agricultural practices,” he said.

    Managing Director, Niger State Agriculture Mechanisation Agency (NAMDA), Alhaji Baba Madugu, has hailed the organic farming initiative, saying it is the way to go for Nigeria.

    Represented by the Zone A Zonal Coordinator of NAMDA, Ismaila Musa, the Madugu, however, craved for an inclusion of youths and women in the scheme.

    He said: “The youth in agriculture are the future, hence should be integrated into the scheme. I also want to make special case for gender sensitivity.The women must be included in this.”

    He called on Contec Global Agro to ensure steady supply of the products in the market, adding that the cost must also be friendly.

    FADAMA III Coordinator in Niger State, Alhaji Mohammed Vatsa, who represented the Permanent Secretary, Niger State Ministry of Agriculture, said, the initiative was commendable.

    He said: “FADAMA is highly supportive of modern initiatives in agriculture. However, this cannot be possible if we are using obsolete equipment and techniques of farming. This is why we welcome the initiative of organic farming being promoted by Contec Global Agro.’’

    According to Vatsa, testimonies from the farms have shown that continuous use of bio-fertiliser and bio-pesticides would help to boost yields for farmers, advising that every farmer should go for it.

    The traditional leaders of the neighbouring communities, represented by the Emigi Village Head, Ndashietu Idrisu, appealed for the inclusion of other villages in the scheme.

  • Reps urge govt on cocoa export standard

    The House of Representatives yesterday urged the Federal government to provide incentives and farm inputs to cocoa farmers to enable them increase the quality of cocoa they produce.

    According to the lawmakers, this would allow the farmers to make high quality cocoa beans available at reasonable prices for the processing factories both locally and internationally.

    The House also urged the National Agency for Food and Drug Administration and Control (NAFDAC) to ensure that cocoa and other products are properly processed to meet regulatory requirements and global standards before being exported.

    This was sequel to the adoption of the prayers of a motion sponsored by a member, Hon. Mayowa Akinfolarin.

    According to the lawmaker,  in the past, no agricultural commodity surpassed cocoa in terms of earnings of foreign exchange, adding that the cocoa sub-sector still offers huge employment opportunities, directly and indirectly.

    He however regretted that for a long while, cocoa processing companies have faced a lot of challenges ranging from high cost of production, unpredictable and fluctuating prices of raw cocoa beans, lack of funds and non-standardised cocoa products.

    He said: “While Nigeria, like other countries, is focusing on agro-business to earn more foreign revenue, it’s main challenge in the exploitation of cocoa and other products is that exporters do not follow the law on standardisation.

    “It is of concern that cocoa and other agricultural products are exported without testing, which leads to the products being returned or destroyed when they are tested abroad and found to be below global standard.