Stakeholders seek to mainstream informal cross-border trade to boost non-oil export

To drive policy to upgrade Ebute-Ero market into export terminal

As part of efforts to streamline Nigeria’s informal cross-border trade (ICBT), get accurate data and boost cross-border and intra-African trade, the Nigerian Export Promotion Council (NEPC), recently held a one-day stakeholders’ engagement that sought to mainstream informal cross-border trade in Nigeria.

Themed, ‘Mainstreaming Informal Trade and Data Collection for Enhanced Economic Development,’ the engagement saw participants drawn from Nigerian Customs Service, the NEPC, Nigerian Agricultural Quarantine Services (NAQS), trade consolidators, XPT Logistics and the Lagos State Ministry of Agriculture. Other stakeholders included representatives from the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), National Agency for Food and Drugs Administration and Control (NAFDAC), Nigerian Shippers Council (NSC), Standard Organisation of Nigeria (SON), Lagos Ministry of Youths and Development, National Bureau of Statistics (NBS), West African Association for Cross-border Trade and licensed exporters from the Ebute-Ero market in Lagos Island.

The NEPC said at the end of the data collection, they aim to drive policy that will turn the market to an export terminal. They revealed that it would first be a consolidator’s hub before progressing into a terminal.

Regional Coordinator, Southwest Regional Office, NEPC, Ganiyu Gbolagade, stressed that they intend to enhance non-oil exports, adding that the lack of adequate information on the nature and magnitude of cross-border trade between Nigeria and its neighbours is a major source of concern to them. He said this necessitated the undertaking of a study on ICBT activities across the various borders of the country, adding that the study would address issues around the magnitude, pattern and composition of ICBT.

Gbolagade said it would also help in identifying the category of commodities being traded informally across the selected border posts, determine the direction of unrecorded cross-border trade in Nigeria; estimate the values of unrecorded cross-border trade flows and generate unrecorded cross-border trade estimates for BOP compilation.

“This would also be a way to formalise the informal sector and significantly increase the contributions of non-oil product exports to the country’s Gross Domestic Product (GDP) in order to diversify the source of Nigeria’s national income. We have been to Birnin-Kebbi, Saki in Oyo state, Ebute-Ero in Lagos and will finish off at Oron in Akwa Ibom. We want to know the challenges of exporters in the informal sector and provide solutions to boost our export numbers. We don’t have any formal estimate of what is being exported in total from the market but this is something we are working towards,” he said.

On his part, Director, Trade Information department, NEPC, Dr Joe Itah, divulged that the Ebute-Ero market is a key, consolidated trading point for manufactured and agro-allied goods that leave Nigeria to the rest of West Africa, including Ghana, Cote d’Ivoire, Guinea Bissau, Abidjan, Lome and Benin Republic.

He added that the volume of unrecorded goods leaving the shores of Nigeria daily is unimaginable. He added that the country got just $4.5 billion as formal export proceeds last year and is well aware that non-oil exports, especially in the informal sector, bring in four times that amount, annually.

The NEPC director revealed they would work closely with the market’s major exporter to capture everyone that export goods through the land borders. He added that in the last two months (May and June), goods worth over N2 billion were exported to Ghana from the market alone. He said they hadn’t even sourced trade data from other key points like Mile2, Badagry and Seme Border, adding that their efforts would not stop in Lagos alone but will include other key border states across the country.

Export Manager, Abdulsalam Ayinla Nig. Ltd, Abdulsalam Adewale, stressed that most exported goods are made locally and they only work with designated country consolidators to control what is exported, checkmate smuggling and ensure nothing illegal is brought in.

Revealing that the weak Naira is improving local trade significantly as most of West Africa prefer to buy goods from Nigeria as it is cheaper, he pleaded with the government to look into the activities of non-state and even state actors that frustrate intra-country trade and movement. “Area boys are a menace to us. If our trucks break down, they will descend on us with alacrity, demanding as much as N200, 000. In the past, the area boys used to hop on the truck, tear the tarpaulin covering the goods and the goods fall off the truck costing us millions of Naira in losses. Now, we are forced to employ the services of army personnel to escort us to the border to prevent that.”

He also lamented the excessive amount of ‘checking points’ on the roads leading to the border, which he said is almost 40 at his last count. He said they have raised this concern several times in the past to the necessary agencies and pleaded that genuine traders be exempted from the numerous extortions.

Regretting that the general downturn in the economy has affected trade, he said in the past, they used to send out as much as 25 trucks daily but now, send just between two to four trucks out daily. He also pleaded with the government to fix not just the roads within the market but the country’s roads which they use to move the goods.

Adding that their monthly volume of trade is in billions of Naira, he said it would have been much higher if the economy improves. Refuting that they prefer to sell to other African countries rather than Nigerians so as to get FX, he said they sell to everyone, so far the customer brings money to them.

He added that despite being in the informal economy, he said they bring in a significant amount into the economy and pleaded with the government to put the right infrastructure in place and address their concerns to ensure that cross-border trading activities improve significantly. “It is our desire to sell more than what we are doing now and even expand to the rest of Africa. If we’re able to trade more, it benefits not just us but the government as well,” he said.

Export Trade Consolidator, Salami Nasiru, listed challenges in cross-border trade to include lack of political will, poor power supply, poor infrastructure, rising insecurity and lack of proper documentation.