Embracing Non-Oil Exports As Viable Means Of Economic Growth

One of the greatest desires of any nation is the need to build a resilient economic system that is self-sustaining, highly competitive, and externally visible. Citizens of every nation too desire a strong and reliable economy and a conducive environment where they could live and operate satisfactorily. To this end, nature endowed nations of the world with natural and human (intellectual) resources through which they could develop economically and sustain her citizens. However, no country of the world, Nigeria inclusive, could grow or develop effectively despite her natural endowments without depending on another country. This growth is mostly enhanced through trade and export. Before Nigeria gained independence in 1960, her economy was dominated by trade and export and the non-oil sector (agricultural and solid mineral sub-sector) was the mainstay of her economy and the greatest foreign exchange earner contributing about 65 per cent of her (Nigeria) aggregate income.
The non-oil economy can be defined as economic activities that are not directly or indirectly related to the petroleum and gas industries. These are the manufacturing, agriculture, services, telecommunications, the financial sector (banking and insurance) activities and tour operator (hotel, restaurant, park) aside others. According to a recent research, seven non-oil activities in percentages contributed to the Nigeria Economy in Q2 of 2022 and they include Agriculture – 23.2 %, Trade- 16.8 %, Telecoms -15.0%, Manufacturing- 8.65 %, Crude oil and Gas -6.33 %, Real Estate -5.33% while Financial and Insurance contributed 4.25%.On August 23, 2022, the Nigerian Export Promotion Council (NEPC) announced that Nigeria exported over 4.146 million metric tons of non-oil products worth $2.593 billion from January to June 2022. According to Dr Ezra Yakusak , the Executive Director of NEPC, the progress report of $2.593 billion represents a 62.37 per cent increase in non-oil export recorded in the year as against the $1.59 billion and $981.44 million recorded in the first half of 2021 and 2020 respectively.Yakusak said that the report was also the highest half year non-oil export performance since 2018 which contributed significantly to the nation’s economy growth in the face of a global economic recession that affected most businesses in 2021.
He said it also contributed to poverty alleviation, industrial development and foreign exchange employment earnings for the country. “The figures of 4.146 million metric tons of product worth $2.593 billion exported between January and June 2022 culled from the non-oil export performance reports of various pre-shipment inspection agents, reinforces NEPC’s campaign to embrace non-oil export trade as a viable means of economic growth,” he said. The NEPC Executive Director equally hinted that over 200 different products, ranging from manufactured, semi-processed, solid minerals to raw agricultural products, were reportedly exported in the period under review. He said that unlike what was applicable in the past, products exported from the country were gradually shifting from the traditional agricultural products to semi-processed/manufactured goods. Yakusak equally said that during the period under review there was no incidence of export rejections while different Nigerian products were exported to 112 countries including America, Asia, Europe, Oceania regions and some Africa countries adding that of this number Brazil, US and India were the top three export destinations based on the value of imports.
“With 572 companies reportedly participating in exporting products, analysts’ belief it is an indication that Nigerian businesses are gradually embracing the diversification campaign of the NEPC by venturing into non-oil exports,” he said. Also worthy of note is the fact that the Federal Ministry of Industry, Trade and Investment (FMITI) is working assiduously with other Ministries, Departments and Agencies to end the rejection of Nigeria’s products in the international market. To this end, the Minister of FMITI, Otumba Adeniyi Adebayo, inaugurated a Technical Committee on Export Rejects charged with the responsibility of identifying the major causes of the rejection of the agro produce and proffering appropriate recommendations. The committee headed by the Director, Commodities and Export Department, Mr Suleiman Audu, is expected to make recommendations that would assist the promotion of non-oil commodity exports which had led to farmers and product aggregators partnering to explore the export market for their products.
Reacting to the above Chief Chidike Okoh, Secretary, National Fish Association of Nigeria (NFAN) is of the view that Nigeria non-exports especially agro-products should not be allowed to suffer rejection. “If Nigeria agro-products continue to suffer from export rejections by most countries of Asia, Europe and America, it will lead to huge financial loss with its attendant negative impact on the supply value chain and job creation. “The global market is competitive and welcomes products of high quality with relevant certifications and quality packaging that are environmentally friendly,’’ Okoh said. Mrs Adaku Chidume-Okoro, the Group Managing Director, Gum Arabic Company Nigeria (GACON), and an exporter also emphasised the need for the Federal Government to scale up efforts in encouraging non-oil export activities.
She urged the Federal Government to look beyond dependence on crude oil as a major income earner for Nigeria but optimise the full potentials in the non-oil export sector. Chidume-Okoro is also of the view that government and stakeholders should equally begin to identify emerging issues that disrupt the non-oil sector. She listed the war in Ukraine, food safety and traceability issues, organic foods, certification, digital world and COVID-19 as some of the global factors disrupting the activities of the non-oil sector. “On the other hand, weakening of the Naira is a major domestic factor adversely affecting Nigeria’s non-oil export sector. “These disruptive events both at the global and domestic levels have unsettled the status quo in the traditional Nigerian non-oil export sector. “A good strategist sees great opportunities in disruptions. It is time to think outside the box and come up with innovative solutions that will skyrocket the Nigerian non-oil export to an all-time high performance,” she said.
She also solicited FG’s intervention on international trade barriers. “For example gum arabic from Sudan and Chad are duty exempt in China and India, whereas the same product from Nigeria is under heavy duty. “This makes Nigerian gum arabic unattractive to China and India markets. Our government will need to intervene in this matter by discussing with the governments of India and China,’’ she said. The GMD of GACON in addition advocated for more support to the Small and Medium Enterprises (SMEs) which she said would serve as an innovative solution for enhanced non-oil export growth. According to her, SMEs are catalyst for the desired non-oil export boom and so should be encouraged. “Government should go out of its way to encourage non-oil exports activities that guarantee job security and boost employment for bottom of the pyramid members of the value chain,’’ she said.
On his part, Mr Sam Agbe, Director of Performing Arts, National Council for Arts and Culture (NCAC) stressed the need for Nigerians to embrace the creative industry and export talents. According to him, it is not only goods and services that are exported, one can export one’s talent so that individuals and the country can benefit economically. ‘You don’t need to have a doctorate degree before you can strive in the creative industry. “What the country needs at this time is to get everybody involved in the creative economy. NCAC has been keen in exporting talents,” Agbe said. Conclusively, before Nigeria gained her independence in 1960, her economy was mainly dominated by trade and export of non-oil producing products. With the discovery of crude oil, the country’s economic dependence shifted from non- oil products to crude oil. Today, the near negligence of non-oil products seems to be having its toll on the nation’s economy, reason some analysts had advocated the return back to agriculture and other non-oil products.Since countries are endowed with natural resources and export is important for the survival of every economy even when other activities fail, there is therefore need for Nigeria to heed the call for an attention shift to non-oil exports through more support and empowerments to SMEs and other players in the non-oil industry.

By: Calista Ezeaku