$230m lost as Nigeria fails to capture $46bn non-oil exports

Nigeria’s inability to properly capture the value of non-oil exports moving to different markets in Africa, Europe and  the Americas in five years, may have cost the country a whopping $230 million in revenues that could have accrued as export duties to the Federal Government.

Between 2009 and 2013, the cumulative total of these uncaptured non-oil exports hit $46.19 billion, according to data from the International Trade Centre (ITC), aggregated by the Nigerian Export Promotion Council( NEPC), obtained by BusinessDay.

On the other hand, information obtained from the Manufacturers Association of Nigeria Export Group (MANEG) showed that the Federal Government mandates each non-oil exporter to pay 0.5 percent duty on the value of the total non-oil exports to the Nigeria Customs Service (NSC).

 The 0.5 duty is often called Nigerian Export Supervision Scheme (NESS), according to MANEG.  By implication, 0.5 percent duty on uncaptured $46 billion implies a revenue loss of $230 million.  

Currently, Cobalt International Limited is the Federal Government-appointed agency that inspects and calculates non-oil exports pre-shipment. On the other hand, the ITC is a subsidiary organisation of the World Trade Organisation (WTO) and the United Nations Conference on Trade and Development (UNCTAD), which provides trade-related technical assistance to 117 countries.

 Findings have revealed that while Cobalt obtains its data from the volumes of goods leaving the country, the ITC obtains data from import destinations of countries, meaning that the latter obtains data on Nigeria’s non-oil exports from  countries where the exports move to.

Colbalt’s 2009 data indicated the country’s  non-oil exports data by end of the year were $1.71 billion, but the ITC data revealed the actual non-oil exports were $6.55 billion. This leaves the country with an uncaptured data of $4.85 billion, according to the ITC data.

Similarly, 2010 Cobalt’s statistics revealed non-oil exports value by end of the year were $2.32 billion, but the ITC’s showed the total exports as $4.81 billion, leaving the country with uncaptured non-oil exports of $2.5 billion.

In 2011, Cobalt non-oil exports calculation showed $2.77 billion, whereas the ITC’s read $10.62 billion, meaning the value of uncaptured data was $7.86 billion.

In a related development, Cobalt’s non-oil exports data in 2012 showed a decline to $2.55 billion, but the ITC’s revealed an increase to $13.66 billion, leaving the country with an uncaptured value of $11.11 billion.

Last year, 2013, non-oil exports calculated by Cobalt indicated an increase to $2.97 billion, while the ITC’s statistics showed a further increase to $22.85 billion, implying that uncaptured data within the year reached a peak of $19.877 billion. Hence within these five years, the country has undercalculated non-oil exports value of $46.19 billion.

Africa’s biggest economy has failed to plug such and many other revenue loopholes, leading the country to incur so much wastes and resulting in graft and inability to meet financial and developmental obligations.

  The Central Bank of Nigeria (CBN) data in 2013 showed the country lost $1.3 trillion from oil decline, occasioned mainly by crude oil theft, which is yet to be checked in the Niger Delta region. Again, this is coming at a point when allocations  to state

governments have declined, dropping to N634.721 billion in April 2014, from N641.38 billion recorded in the previous month.

‘’I am disappointed with loss of revenue to the country.  We also need the international community to get involved,’’ said Ngozi Okonjo-Iweala, coordinating minister of Nigeria’s economy and minister of finance, during an interview on CNN, bordering on revenue loss last year.

Olusegun Awolowo, chief executive officer (CEO), NEPC, said the data indicated that 80 percent of non-oil export transactions  were not recorded, accounting for the wide disparity in the official statistics in the country and those provided by the ITC.

‘’If the above data, especially the one from ITC, is a true reflection of the activities in the sector, it means progress is consistently being made in Nigeria’s non-oil export sub-sector and the rebased of Nigeria GDP is in order,’’ he stated.

‘’ It suggests that a fraction of non-oil activities is being captured as an average of about 200 percent of the transactions are not recorded,’’ he added.

Analysts say that this is also an indication of  enormous opportunities in Nigeria’s non-oil export business, notably manufacturing,  with its 6.81 percent contribution to the rebased $510 billion, which amounts to  $34.8 billion (N5.47 trillion).

But they say it shows the informal sector accounts for the majority of the country’s non-oil exports.  The informal economy  is part of an economy that is not taxed or monitored by any form of government or included in the GDP), experts say.

Stakeholders also add that in-spite of the efforts of the Nigeria Bureau of Statistics (NBS), which manages data in the country, there is still so much disconnect  among relevant agencies, leading to poor data coordination.

‘’If you look at the problems confronting us as a nation today, all of them derive from a single fact that we lack data. And because we lack data, we don’t plan. So that is what I think we should be looking at,’’ said Eze Duruiheoma, chairman, National Population Commission( NPC).

ODINAKA ANUDU