‘Why non-oil export sector may remain at level of potential’
According to the non-oil exporters, challenges revolving around products, pricing, paperwork, payment, promotion and policies need to be addressed for the non-oil export sector to contribute meaningfully to the nation’s Gross Domestic Product (GDP).
Indeed, latest data from the National Bureau of Statistics (NBS) showed that total export value amounted to N4.463 trillion in Q2, 2018, representing a contraction of 4.9% over Q1, 2018 (N4.692trillion) and a growth of 43.8% over Q2, 2017 (N3.10 trillion).
The total value of Nigeria’s external trade in goods amounted to N6.569 trillion in the second quarter of 2018, a decrease of N641.1 billion or -8.9% from the N7.211 trillion recorded in the first quarter of 2018.
Chairman, Export Group, Lagos Chamber of Commerce and Industry (LCCI), Bamidele Ayemibo, said the hydra-headed challenges can be addressed through collaboration between the private sector and government in the areas of policy initiation and implementation.
Ayemibo said: “The challenges of product is in two parts, on one hand, it has to do with the quality of product being exported and on the other hand is the focus on only exportation of primary products.
“The quality issues are mainly due to knowledge gap on the part of exporters, dubious practices among exporters and local suppliers, inadequate inspection agents, inadequate laboratories for testing and sometimes unprofessional and dubious inspection agents.
All these hinder the exporters from getting paid after shipment and this makes them to be discouraged and halt further shipment.
“The focus on the exportation of primary products also reduce our foreign exchange earnings because the more the value addition of the product, the more buyers are willing to pay”.
Executive Secretary of the UN Economic Commission for Africa, Vera Songwe, also called for improved processing saying: “We must do more, better and faster by improving on infrastructure, logistics and reducing tariffs and non-tariff barriers”.
Chief Executive Officer of Friday Consult Limited, Fred Uwheraka noted that the only solution to storage is harnessing these products from the farmer’s gate by adding value.
“Our selection process is a major issue. As an exporter you have to know the requirements of a specific product for each country you are exporting to.
Your selection process must be very good; you must know if the products are exportable and you must also be consistent.
“Another problem exporters are having is the issue of freight forwarding.
You must use a reliable forwarding agent and the selection process should be yours.
Delays in forwarding can bring about somelevel of doubt on the part of the receiver at the other end”, he added.
He said the reason why Nigerian products are not selling well at the international market is due to lack of continuous supply.
He advised exporters to carry out due diligence economies of scale for each export they make to have pre-knowledge of returns.