• Friday, March 29, 2024
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Exporters push for friendly policies as Afreximbank dangles $500m support

Afreximbank

Manufacturing exporters want friendly policies that will enable them to repatriate dollars into an economy in dire need of foreign exchange.

Speaking at an annual general meeting held in Lagos last Thursday, Ede Dafinone, chairman of the Manufacturers Association of Nigeria Export Promotion Group (MANEG), said the poor performance of exports called for export friendly policies that would enable players to raise production by expansing their factories.

Dafinone said a 1.5 percent increase in non-oil receipts in 2018 from 2017 was a testament that the government needed to restart the Export Expansion Grant (EEG),which had been the most successful export incentive deployed by the Federal Government.

Nigeria’s total non-oil export earnings from more than 25 commodities in 2018 amounted to $3.3 billion (N1.19 trillion), according to the National Bureau of Statistics (NBS). A country like Bangladesh earned ten times that from only one product — garment.

According to Dafinone, some of the challenges faced by the sector included poor infrastructure, high energy costs and non-payment of the EEG claims.

“I shall add the closure of borders to the list of the challenges,” he said.

“Our land borders have been closed and this is affecting export and import by our members,” he further said.

A document seen by BusinessDay shows that the National Assembly committees approved the promissory notes of 269 companies worth N193.042 billion for the payment of EEG claims.

Some of the companies approved were A&P Foods, African Glass Limited, African Textile Manufacturers Limited, Crown Flour Mills, Jebba Paper Mills, Deli Foods, Peugeot Automobiles, Procter & Gamble, Ajaokuta Steel Company, Olam Nigeria Limited and GZ Industries, among many others. But the Federal Government is yet to start settling any of these claims.

The EEG was originally established in 1986 to help Nigerian exporters to become competitive at the global market. It is a practice in many developing and developed countries such as China, India and Australia to provide concessions or cash rebates/grants to companies penetrating new markets or consolidating already established markets to enable them rival competitors.

In Nigeria, companies that exported different kinds of products or commodities between 2006 and 2016 were owed billions of naira in claims as the federal government did not meet the obligation of settling them as promised. After suspension since 2013, the current government says it will settle the claims, but is yet to do so.

The National Assembly is yet to approve the remaining 38 companies, which include PZ Cussons, British American Tobacco, Okomu Oil, Lee Group (which has seven subsidiaries), and Sapele Integrated. Others are Nestlé Nigeria, De-United Foods, Beta Glass, Unilever, and Dangote Agrosacks, among many others

 “The Group, in collaboration with our parent body, MAN, is working assiduously to ensure the enlisting of the 38 exporters by the 8th Assembly,” he said.

Kanayo Awani, managing director, Intra-African Trade Initiative at the African Export-Import Bank, who represented Benedict Okey Orama, president and chairman of Afreximbank, said the forthcoming African Continental Free Trade Area (AfCFTA) would help a cotton yarn producer in Nigeria to become a supplier to a fabric manufacturer in Senegal, replacing yarn imports from Asia.

Speaking on ‘Leveraging the African Continental Free Trade Area Agreement for Export Expansion in Nigeria’s Manufacturing Sector’, Awani said the bank had facilities available under both its Intra-African Trade strategy and its Industrialisation and Export Development Strategy that Nigerian exporters and manufacturers could leverage with AfCFTA coming.

“These facilities are available through our US$ 1 billion Nigeria-Africa Trade and Investment Promotion Programme (NATIPP), being done in collaboration with the Nigerian Export Promotion Council and the Nigerian Export-Import Bank (NEXIM) and is aimed at promoting and expanding trade and investments between Nigeria and the rest of Africa,” she said.

“Of this, the bank has allocated $500 million to support Nigerian manufacturers and exporters to take advantage of the opportunities offered by the AfCFTA,” she reiterated.

Earlier at an annual general meeting held by MAN, Oramah, the bank’s president, had announced a $500 million funding support for Nigerian manufacturers.

Awani reiterated her bank’s willingness to push exports from Nigeria through the fund.

She further said Afreximbank also had a programme to support intra-African trade champions (Intra-Champs), which would identify main players in intra-African trade and support their operations through financing, enabling market access, technical assistance, trade information and advisory services, twinning services and other forms of support for competitive tenders.

She said the bank was also working to eliminate non-tariff barriers to trade by collaborating with the African Regional Standards Organisation (ARSO) to harmonise standards across the continent.

 

ODINAKA ANUDU