Despite aggressive and financially-backed efforts at diversifying Nigeria’s economy, the country remains highly dependent on oil for its national revenue and foreign exchange.
Till date, oil still accounts for 80 percent of Nigeria’s revenue, though recent GDP figures show it has less impact on the country’s Gross Domestic Product computation.
A number of initiatives and investments have gone into developing a cohesive and sustainable diversification plan, with a special focus on agriculture, Nigeria’s initial money maker before it discovered oil.
Those plans have either proved abortive or not sustainable enough to displace the oil dominance. The recent crash in oil prices and Nigeria’s subsequent economic struggles, both at Federal and State levels, are visible proof that Nigeria is yet to effectively move on from its reliance on oil.
But the Nigeria-America Chamber of Commerce, the oldest Chamber of Commerce in Nigeria, is proffering a new and sustainable solution; growing trade.
Nigeria holds some of the largest arable land mass on the continent and is considered a significant producer of yams and other agricultural produce. In recent months, it has begun exportation of some of these products to Asia, South America and Europe. However, import figures show there is much more to be done, particularly in exploiting trade deals to grow these exports.
The Nigeria-America Chamber of Commerce (NACC), which helps Nigerian manufacturers and investors gain access to the American market, it is under-utilizing AGOA, one of the most lucrative trade deals afforded it.
Dr. Ikenna Nwosu, the Director of NACC, during a Business Roundtable discussion with the Deputy Assistant Secretary, U.S, Commercial Service for Middle East and Africa, Mr. Seward Jones on Thursday, advocated that while the U.S steps up its engagement with Nigerian businesses and investors, that the AGOA agreement—which allows African country’s tariff-free exports into America—is an important gateway and a possible solution to growing Nigeria’s exports and building significant non-oil revenue and as such should be looked at with more keenness by the Nigerian government.
He did note, however, that Nigeria must build a concrete AGOA strategy if it intends to fully enjoy the benefits of this trade agreement between the U.S. and Africa. He revealed that the Chamber of Commerce was prepared to work with the U.S. to set up a standard FDA testing facility in Nigeria to ensure the quality of goods exported from Nigeria meet the health and safety standards of the U.S. in order to ensure local goods are not rejected once exported.
Dr. Nwosu revealed that if such a plan is implemented, Nigeria’s non-oil trade exports could easily grow from $200 million to $5 billion annually, a potentially significant foreign exchange earner.