Nigerian exporters missing market opportunity offered by AGOA– NACC
The Nigerian-American Chamber of Commerce (NACC) says Nigerian exporters are missing out on opportunities offered by African Growth and Opportunity Act (AGOA).
“Nigeria is not taking full advantage of AGOA. There is lack of information and the culprits are usually are the government people,” said Olabintan Famutimi, president of NACC, during the hosting of Seward Jones, deputy assistant secretary, US Commercial Service for Middle East and Africa.
AGOA is a trade act, which is targeted at giving access to the United States market for 6,500 products from Sub-Saharan African (SSA) countries.
The AGOA Act was originally meant to cover October 2000 to September 2008, but it was extended to 2015. On review, it was observed that some SSA countries such as Nigeria did not derive much benefit from it.
Nigeria, with 182 population, exported goods worth only $1.2 million to the US in 2014 whereas the more prepared South Africa, which is just 55 million, shipped products valued at $2.6 billion to the same market and within the same year.
AGOA was subsequently extended to 2025 to enable countries like Nigeria to make maximum benefits. However, Nigeria’s major export to the US remains minerals.
“When you say AGOA, remove oil from it, because crude oil has always been taken to the US under AGOA. My argument over the years is, ‘Don’t calculate crude oil under AGOA,” Famutimi said, while accusing government of not providing the right environment for AGOA to thrive.
Africa’s biggest economy is hard hit by harsh doing business environment, characterised by high cost of energy, multiple taxation and weak currency. Exporters of crops from Nigeria made huge gains in 2016 on the back of weak local currency, naira, but Nigeria’s currency has become in 2017 stronger on the back of central bank interventions.
There are also drops in production of major export crops such as cocoa and rubber.
AGOA rule says that in order to qualify and remain eligible for it, each country must be working to improve its rule of law, human rights, and respect for core labour standards.
“AGOA is a trade concession, where the US wants exports coming from Africa to qualify. It is really up to the African countries to find a way to prepare themselves and get their countries export ready,” said Brent Omdahl, commercial service counsellor, US Consulate in Nigeria.
“The US perspective is that we have given you AGOA; we have given you the opportunity, it is left for you to take advantage,” Omdahl said, adding that many companies in the US were willing to do business with Nigeria and urging the government to improve transparency and ease of doing business.
Seward Jones, earlier cited, said US businesses were eager to do business in countries with good ease of doing business environment, transparency, and places where the customs would not harass them unnecessarily.
“The average America believes that there are things going on in Nigeria. People have a wrong impression about Nigeria and this is what we need to overcome,” he said.
Ikenna Nwosu, director, NACC, said Nigerian SMEs were complaining of insufficient partnership with US companies.
“The complaint is that US companies are largely at the level of multinationals,” Nwosu said, urging US to be aggressive with trading with Nigeria.
Osita Oparaugo, CEO of Footprint to Africa, said despite the impression given by US businesspeople, Nigeria still had honest, hardworking entrepreneurs who were making their marks across the world.
“The US should wake up to the reality that they are also missing out here in Nigeria,” Oparaugo said.
ODINAKA ANUDU