Nigeria's leading finance and market intelligence news report.

Sealink Project to formalise trade at Aba business corridor— NEXIM Bank

…to start before end of 2019

The proposed regional Sealink Project, spearheaded by the Nigerian Export Import Bank (NEXIM), will start operations before the end of 2019, says Ugoenyi Kalu, head, Lagos Area office of NEXIM Bank.

Kalu, who represented Abba Bello, managing director, NEXIM Bank, said at a one-day capacity building workshop in Aba, Abia State, that the project would encourage formal trade within the Aba finished leather cluster.

The training, which centred around  export financing, was organised by the Nigerian Export Promotion Council (NEPC) for exporters and intended exporters in the industrial city.

The project would also enhance Nigeria’s export to Economic Community of West African States (ECOWAS) countries, which has remained muted for several years at about 12 to 15 percent.

The Aba finished leather cluster, made up of shoe, belt and bag manufacturers, is waiting for the take-off the regional Sealink Project to formalise their trade.

Aba-made shoes and other finished leather goods are popular in Cameroon, Cote d’Ivoire, Gabon and other West, East and Central African countries, however, these transactions are done unofficially.

Ken Anyanwu, national secretary, Association of Leather and Allied Industrialists of Nigeria (ALAIN), an association of shoe, bag and belt makers, told BUSINESSDAY  that the data currently used for policy and advocacy in the leather sector are estimates, stressing that no accurate and verifiable information on the activities of the sector are available for use.

These include finished leather goods needed by Nigeria annually, finished leather produced and exported from Nigeria annually, Nigeria’s finished leather goods production capacity, quantity of products exported from the country and the number of persons engaged in production in the sector.

The regional Sealink Project, a partnership between NEXIM and the Federation of West African Chambers of Commerce and Industry (FEWACCI), will connect West and Central Africa sub-regions, according to NEXIM, and foster indigenous participation of African nations in the maritime sector.

BusinessDay gathered that 700 containers have been registered in Sealink, which is expected to provide immediate impact on basic road infrastructure, which has slowed African and Economic Community of West African States (ECOWAS) trade levels by 20 percent, according to available statistics.

The total project cost is estimated at $60million, with $36million to procure vessels, equipment, office space and other infrastructure. About $24million will be the working capital to cover the general and administrative expenses.

BusinessDay also gathered that the project would make Nigeria a maritime hub for West and Central Africa and enable NEXIM achieve its planned revenue growth by improving intra-regional trade levels to about 15 per cent annually.

NEXIM recently signed a tripartite memorandum of understanding (MoU) for the partnership in the project, between the National Inland Waterways Authority (NIWA), NEXIM and Sealink Promotional Company Limited.

Bello, at the signing ceremony, explained that the regional Sealink project was initiated in 2011 to remove the huge logistics challenges and non-tariff measures along the ECOWAS trade corridor.

According to him, NEXIM’s strategic interest to promote the project was to bridge the infrastructure gap, to promote and enhance trade connectivity as well as spur Nigeria’s regional and global trade competitiveness.

He described the agreement as a historic one aimed at deepening the partnerships between NEXIM and NIWA, on the one hand, and NEXIM and the Sealink on the other.

He said the agreement would boost the realisation of one of the priority projects under the ECOWAS Community Development Programmes.

The interest to pursue the project, he said, was driven by the desire to encourage formal trade and enhance Nigeria’s export to ECOWAS, which has remained muted for several years at about 12-15 per cent.

To realise these objectives, he said, NEXIM introduced the ECOWAS Trade Support Facility (ETSF) designed specifically to achieve intra-regional trade and development objectives.

Also, the facility was to help increase Nigeria’s trade flow within the ECOWAS sub-region, especially trade in manufactured goods to broaden national export basket.

He stated that the support was targeted at facilitating formal/recorded trade within the sub-region and promote exports by small traders as well as micro, small and medium enterprises by integrating them into the formal sector of the economy.

It was also to deepen the current payment systems and trade instruments in the ECOWAS region, he added.

“As a trade policy bank, NEXIM’s strategic interest and partnership in the regional Sealink Project is to promote and diversify exports as well as enhance trade connectivity in line with the government’s objective to diversify the economy,” he said.

Also, the bridging of the maritime infrastructure gap is expected to significantly enhance exports of bulk solid minerals, thereby boosting the gross domestic product(GDP) contribution of both shipping and solid minerals sectors, from current levels of about 0.2 per cent,” he stated.

Whatsapp mobile

Get real time updates directly on you device, subscribe now.