The Lagos Chamber of Commerce and Industry (LCCI) has stated that exportation of primary products to the global community without value addition by way of processing, will not generate the desired level of foreign exchange needed to achieve economic diversification and accelerate economic growth.
The president, LCCI, Mrs. Toki Mabogunje, at a seminar on Africa Continental Free Trade Agreement (AfCFTA), noted that Nigeria’s non-oil export sector is dominated by export of raw materials and primary products over the years, saying that Nigeria could generate more foreign exchange earnings if these primary products were processed into value-added commodities before exportation.
“The prospect for our export remains substantial as the Central Bank of Nigeria (CBN) estimated that with full implementation of the AfCFTA, Nigerian exporters will gain access to markets in Africa worth $504.17 billion in goods and $162 billion in services. These enormous potentials can only become tangible outcomes when we focus on value addition, which will help accelerate the development of the non-oil sector while boosting Nigeria’s foreign exchange earnings,” she added.
The Assistant Director, Research and Advocacy, LCCI, Sunnie Omeize-Michael, represented the president at the event. Themed, “AfCFTA: The Road Map for Exporters Successful Participation”, Mabogunje said the event was part of the public engagement series of the Chamber aimed at facilitating discussions among stakeholders on the appropriate steps towards maximum utilisation of the trade agreement.
Citing the National Bureau of Statistics (NBS), she said Nigeria’s export to other African countries in the first quarter of 2021 accounted for just 15.5 per cent of its total export, which remains worrisome, pointing out that the AfCFTA offers significant opportunities for the Nigerian private sector to expand into new markets and seek new opportunities particularly in manufacturing, ICT, agriculture and financial services given its growing comparative advantage in these areas.
She urged the non-oil exporters to adhere to the rules and procedures of AfCFTA and comply with requirements, protocols and procedures set by individual countries to facilitate trade and economic integration of the continent.
“Nevertheless, we all must work together to support the increased growth of our non-oil exports as it would help to enable higher economic growth and improve our foreign exchange,” she added.
Also speaking, the Secretary, National Action Committee on AfCFTA, Mr. Francis Anatogu, said implementing the AfCFTA is still challenged with key challenges which includes capacity and skill dearth, circa 50 per cent capacity utilization, low agricultural yield and high post harvest losses
He also stated that other bottlenecks to the implementation are significant dependence on imports for inputs and components, intense competition from cheaper imports, high non-operating costs, slow implementation of incentives and local off take arrangements, poor access to foreign markets (quality, country brand, economic cooperation), data deficiency and low adaptation to technology and best practices.
The Chief Executive Officer, Nigerian Export Promotion Council (NEPC), Olusegun Awolowo, who was represented by the Director Trade and Information, Mrs. Ifeyinwa Obidike, said the AfCFTA is going to be the largest trade deal in the whole world, adding that there are number of opportunities for Nigeria’s non oil exporters to benefit from.
She added that the trade between countries in Africa is still low, calling on the need for African governments to address barriers to trade to boost regional integration.