Growing non-oil earnings

Earnings from the non-oil sector of the economy rose by 236.4 percent in third quarter of 2013 and 362.0 percent above the level in the corresponding quarter of 2012, the Central Bank of Nigeria (CBN) has revealed recently in its third quarter economic report. The report equally showed that total non-oil export earnings by Nigerian exporters during the third quarter of 2013 stood at US$2.64 billion.

This positive development is attributed, largely, to the 55.9 percent and 187.4 percent increase in the proceeds of industrial and manufacturing sectors, respectively, as well as the significant increase in proceeds from primary agricultural and other products.

A breakdown of the proceeds showed that agricultural products earned US$1.3 billion, manufactured products earned US$738.7 million, industrial earned US$522.7 million, minerals earned US$47.5 million, and food products earned US$27.4 million.The shares of agricultural products, manufactured products, industrial, minerals and food products in non-oil export proceeds were 49.3, 28.0, 19.81.8 and 1.1 percent, respectively.

Available data from the report showed that total federally-collected revenue during the third quarter of 2013 stood at N2.7 trillion, representing a decline of 4.2 percent and 1.58 percent below the quarterly budget estimate and the level in the corresponding quarter of 2012, respectively. However, relative to the level in the preceding quarter, total federally-collected revenue rose by 14.4 percent.

The report shows that at N1.6 trillion gross oil receipts, which constituted 59.7 percent of the total, declined below the proportionate budget estimate and the level in the preceding quarter by 16.1 percent and 10.5 percent, respectively.

The development relative to the preceding quarter was attributed to the decline in most of the components of oil revenue during the review quarter non-oil receipts (gross), at N1,093.64 billion (40.3 percent of the total), was above the proportionate budget estimate and the level in the preceding quarter by 21.3 percent and 95.3 percent, respectively.

This emerging picture from the non-oil sector, against an unfolding scenario of volatile crude oil earnings occasioned by growing oil theft and increasing threat of shale gas sources, gives a reassurance that there is a promising future in the pursuit of diversifying Nigeria’s revenue sources.

It has been said severally that Nigeria’s economic growth on a sustainable basis does not lie alone in the exploitation of crude oil or other natural resources but also in the tapping of other potentials especially manufacturing, agriculture and taxes in general. That is why governments must go beyond lip service and continue to provide enabling policies, environment and infrastructure for the growth and development of these activities.

In this regard, we continue to remind governments that the needless drudgery of doing business in Nigeria should be steadily minimized, the tax infrastructure should be streamlined and efficient to boost tax payment, and greater access to less costly funds provided for small and medium businesses.

It is only by doing the needful towards empowering businesses to reach their full capacity that the pursuit of diversification of revenue sources can be achieved.