By Lucy Adautin
A recent report titled ‘Africa Pulse’ by the World Bank, obtained by Heritage Times HT, reveals a stark decline in Nigeria’s revenue from the manufacturing export sector.
According to the report, Nigeria’s revenue plummeted by 166% to ₦778.4 billion from its peak of ₦2 trillion in 2019.
The downward trend in revenue has been evident since 2019, with a significant decline to ₦960.7 billion attributed to the impact of COVID-19 in 2020. While a minor recovery was recorded in 2021 at ₦1.15 trillion, the subsequent years witnessed a substantial drop. In 2022, revenue fell to ₦781.1 billion, followed by another significant drop to ₦778.4 billion in 2023.
The report highlighted several factors contributing to Nigeria’s dwindling foreign trade, with poor infrastructure and inefficient logistics singled out by the apex bank as primary concerns. These challenges have posed significant obstacles to the country’s ability to maintain robust manufacturing export revenue.
The decline in manufacturing export revenue underscores the urgent need for strategic interventions to address infrastructure deficiencies and improve logistics efficiency. Addressing these underlying issues is crucial for revitalizing Nigeria’s manufacturing sector and promoting sustainable economic growth in the country.
According to the report, the cost of trade in Nigeria and Ethiopia is four to five times higher than what is obtained in the United States due to insecurity, higher transportation costs, topography and poor road infrastructure.
“Studies from the Africa region consistently find spatial differences in prices of imported goods (food and non-food) as well as non-traded agricultural staples, indicating that markets are not well-integrated, and retail prices of products are affected by distance.
“For instance, trade costs are four to five times higher in Ethiopia and Nigeria than in the United States, due to poor road infrastructure, low competition in the transportation sector, and topography,” it stated.
The report further revealed that the consequences of these distortions, include preference of African producers to sell locally rather than export.
Amidst growing concerns, manufacturers and operators within Nigeria’s export ecosystem have voiced their dismay over the challenging business environment, citing its detrimental impact on the competitiveness of local products in the global market.
This sentiment follows the release of the World Bank’s report highlighting the significant decline in Nigeria’s manufacturing export revenue. As stakeholders grapple with the implications of this downturn, attention is drawn to the pressing need for systemic reforms to address the underlying challenges stifling the growth and competitiveness of the export sector.
The World Bank’s findings coincide with recent directives from the Nigerian Export Promotion Council (NEPC), urging Nigerian exporters to comply with the stringent requirements for exporting products to various countries.
Addressing stakeholders at a sensitisation workshop aimed at bolstering Nigeria’s export potential and fostering stronger trade relations with China, Executive Director of NEPC, Nonye Ayeni, underscored the importance of adherence to the General Administration of Chinese Customs (GACC) regulations. Ayeni emphasized that compliance with these regulations is essential for Nigerian exporters to navigate the intricacies of international trade successfully.
As Nigeria seeks to revitalize its export sector and enhance its global competitiveness, collaboration between government agencies, industry stakeholders, and exporters becomes imperative. By prioritizing adherence to export requirements, implementing supportive policies, and fostering an enabling business environment, Nigeria can unlock its export potential and position itself for sustainable economic growth.
Ayeni, represented by the North-Central Coordinator of the council, Samson Idowu, said that GACC has clear but stringent requirements for exporting products to China.
“Understanding the registration process, documentation and regulatory changes is paramount for successful export. Understanding the requirements set forth by GACC is crucial for Nigerian exporters to ensure smooth and successful trade with China,” she stated.
At the recent launching of the NSW project in Abuja, President Bola Tinubu stated that Nigeria currently loses about $4bn annually to import-export infractions due to bureaucratic bottlenecks, especially at the ports.
According to the president, the NSW project is expected to ensure 24-hour clearance of goods at the ports and simplify trade by providing a digital platform for all import and export-related activities.
“This initiative will link our ports, government agencies, and key stakeholders, creating a seamless and efficient system that will facilitate trade like never before. It will reduce the need to deal with multiple agencies in multiple locations to obtain the necessary papers, permits and clearances to complete their import or export processes,” Tinubu said.
