The United States of America, through its ‘Prosper Africa’ initiative is determined to foster two-way trade between the US and Nigeria in order to help grow small businesses and improve Nigeria’s economy despite business challenges.
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During a day dialogue in Lagos with private sector business owners, US representatives opened discussions on ways to increase access to finance for Nigerian farms and firms, how to make the African Growth and Opportunity Act (AGOA) work for Nigerian businesses and efforts to scale up and out.
Speaking with select journalists after the dialogue, Earl Gast, executive vice president for programmes, Creative Associates Initiative, an international development organisation, said, “The idea of the new initiative ‘Prosper Africa’ is that with Africa’s prosperity should come the US prosperity; and how can we have private sectors of both Nigeria and the US partner in ways where US capital, know-how and exports can lead to greater economic growth in Nigeria and benefit Nigerians.
“The thinking is that US resources and exports might help grow Nigerian companies so that they are able to export more than they are doing now, and so AGOA allows Nigerians to take advantage of the US market.”
Today, the Nigerian economy is bolstered by a thriving small to medium enterprise (SME) community. The country owes 54 percent of its Gross Domestic Product (GDP) to small and medium businesses; hence, it is a matter of fact that the country will benefit a great deal if businesses are allowed to thrive regionally and globally.
“Today was an opportunity for us to listen to Nigerian companies, and it was a great opportunity to exchange information and make connections because ultimately, that’s how business is done. To scale, one needs to work through associations and we had the Nigerian-American chamber of commerce here, representing a lot of companies,” Gast told BusinessDay.
According to Florie Liser, president/CEO, Corporate Council on Africa, the point of Prosper Africa is that instead of 14-15 different US governments and ministries all doing their own thing, they can have a one-stop approach to co-ordinate support for US businesses that want to come to Africa, invest and do business on the continent and African businesses that want to trade in the US.
“US companies are already trading in Africa and a lot more are interested in coming to Nigeria to do business because the return on investment is one of the highest in Africa and because of the vast opportunities in sectors like agriculture, construction, health and information technology,” she said.
Nigeria has become attractive for foreign investment and double way trade in the last year, as it went up 16 places in the World Bank ease of doing business ranking.
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Liser said, “Already, one of the things that the US have tried to do over the years is the regional trade and investment hub in Accra Ghana that was put there to support African businesses that wanted to export to US markets under AGOA (African Growth and Opportunity Act) and to help them to be more competitive and understand the US market because the market is huge, complex and it’s not very easy if you’re trying to export into the US market but AGOA is a big incentive because there is no taxes or duties on those products. There are over 6,500 products that can come in.”
Through the initiative, Nigerian companies will be helped with product packaging, processing of raw materials into value added products, improving productivity and will be supported when they approach the US for trade terms.
“By bringing Africans to US trade shows, where everybody is looking to buy, they have a chance to meet these smaller companies. These are the kind of things that prosper Africa would want to build on and do a better job. There are also a lot of US companies that are ready to engage with legitimate African companies.”
The Nigerian government has been urged to ensure that an enabling business environment is created so that businesses can grow and investment can occur.
