Impediments To Agro-Export, The Way Forward

By Babajide Okeowo

To export products from Lagos Ports costs about $786 in terms of documentary compliance compared to a sub-Saharan African average of about $633, the number of hours it takes to export from Nigeria is about 124 hours while in Sub-Saharan Africa, it is about 97 hours. The export process in Nigeria is in about 10 to 11 steps while in Sub-Saharan Africa, it is about 5 steps. The list of impediments to export in Nigeria goes on and on!

All these impediments have led to a huge decline or outright loss of revenue that could have been generated from agro-export in the country.

For example, according to data collated by MMS Plus, in 2021, agricultural exports from Nigeria stood at $1.2 billion whereas a year earlier, in South Africa, the country exported $9.5 billion worth of agricultural products signaling a huge gulf in terms of revenue generation from agricultural products from both countries identified as the two biggest economies in Africa.

While Nigeria depends majorly on petroleum products as the source of foreign exchange earnings, it has been identified that agro-export is capable of earning Nigeria the much-needed FOREX and sustaining our weakening naira.

To this effect, stakeholders recently gathered at the Nigerian Shippers’ Council (NSC) Training Room to address this issue and proffer ways to make Nigeria move from an import-dependent economy to an exporting country.

Themed “Multi-Agency Stakeholders’ Enlightenment On Key Reforms Of the Presidential Enabling Business Environment Council Under The National Action Plan 7.0 On Agro-Export” the stakeholders ranging from the Nigerian Shippers’ Council (NSC); Nigerian Export Promotion Council (NEPC); National Agency for Food and Drug Administration and Control (NAFDAC); Nigerian Agricultural Quarantine Service (NAQS); Nigerian Ports Authority (NPA); Nigeria Customs Service (NCS); Organised Private Sectors like Shipping Companies, Terminal Operators all resolved to remove the impediments and bottlenecks hindering the actualization of the huge potential of agro-export.

Kickstarting the discourse, Executive Secretary/Chief Executive Officer (CEO) of the Shippers’ Council, Hon Emmanuel Jime reiterated the need to find a lasting solution to challenges confronting Nigeria’s agro-export and other finished products while highlighting that Nigeria’s economic growth depends on export.

He identified the multiplicity of checks by government agencies and frequent clashes with security agencies as one of the impediments to export at the ports.

“In 2021, the statistics available showed that a 1% increase in agricultural products boosted our economic growth by 25%. This means that Nigeria has the potential to be much more, however, there are two challenges and impediments, one is access to markets and the second one is access to finance for exports.

“Nigerians need access to finance to be able to sell their goods at the international market. It is not just the shipping line charges or terminal charges, the challenges start from the farm, all the way before it even gets to the ports.

“We have yams in Nigeria, but it is being exported by Ghanaians, how does that happen? It would be good if Nigeria is really committed to facilitating trade and aggressively drive these policies that would enable trade both locally and internationally” he stated according to Mrs Ifeoma Ezedinma, Director of Regulatory Services who represented the ES.

Chief CC Agu, Director, Consumer Affairs, NSC is even more worried about the precarious state of Nigeria’s export potential.

He wondered how Nigeria perceived to be the giant of Africa will continue to lag behind and not actualize its huge export potential.

He decried the myriads of challenges facing exportation and reiterated the resolve of stakeholders to tackle them frontally.

“Exportation is the livewire of any economy, a barrier to trade is a barrier to development, it is sad that Nigeria is not paying frontal attention to exportation whereas it is a very powerful tool for job creation, wealth creation and an amazing tool for improving the standard of living of the citizenry.

For Nigeria to get it right, we must export. My advice to this gathering is to identify the solutions, all the agencies are here and we must remove the challenges.

If you take a look at the trade indicators, you will realize that we are not doing well at all, in 2020, the National Trade Facilitation Committee carried out a review of the Nigerian Trade Facilitation Road Map, but the outcome is not good.

The cost of exporting from Lagos Port is about $786 in terms of documentary compliance while the sub-Saharan average is about $633 while in the developed countries it is about $150

When it also comes to the processes and steps to follow, it is about 10 steps, in sub-Saharan Africa, it is about 5 steps

The number of hours it takes to export from Nigeria is about 124 hours while in sub-Saharan Africa, it is about 97 hours.

In the World Bank Global Logistics Performance Index, Nigeria is ranked 97 out of 140 countries that were ranked, ten years ago, we were around 75, so why are we moving backwards? We should be going forward, South Africa is around 25 to 26 on the ranking and this is a country that we are competing against in Africa, the indices are not favourable

All of us must come together and remove these obstacles. We must identify ways to reduce the number of time it takes to export from our ports to the sub-Saharan average, and how we reduce the cost to the sub-Saharan average.

I sincerely believe that if we are the giant of Africa as we claim to be, we should be doing better than these other African countries” he added.

Chief Executive Officer, XPT Logistics International Limited, Barrister Kola Awe, blamed every stakeholder in the export value chain for contributing to the bottleneck and challenges which has deprived Nigeria of achieving the much-required potential in the sector in one way or the other.

He lamented that the export processes in Nigeria are extremely too much and called for the simplification of the whole process. He noted that many ports globally are working towards a paperless port, the same cannot be said of Nigerian ports.

Proffering the way forward, Mr Awe enjoined all to be intentional and deliberate in coming together to eliminate some of the challenges that we are facing.

“Exporters must know their commodity, the documents, the specifications and standards, use the correct packaging for each product, and be conversant with the import procedure of the country they are exporting to.

Dubai is doing about $48bn, China and some European countries are doing trillions in dollars in terms of exports, and Nigeria can also aspire to do better.

Having multiple agencies carrying out the same functions within the ports defeats the essence of ease of doing business, In Nigeria, you write to about 6 to 7 agencies, whereas in Ghana, you only write to the Customs” he added.

This is where agencies like the Nigerian Export Promotion Council (NEPC) come in. According to the NEPC Executive Director/CEO, Dr. Ezra Yakusak training and capacity development are crucial to a sustainable agro-export business.

“Before you go into export, there is a need to build your capacity, know what you are exporting, know the market, and understand all the strategies that you need to deploy to make a success of the business.

Once you register with NEPC, there are different categories of capacity building starting from export training, we also have a mentorship programme in place that trains our exporters from zero level until they become an expert, at the end of the training exercise, the exporter would have been introduced to all the logistics involved in exporting” he said through his representative, Mrs Patricia Onu, a Senior Officer at the Council.

She also disclosed the role of the establishment of Domestic Export Warehouses (DEWS) in boosting agro-export.

This is also an area that the Council is working to ensure that export is boosted. We have collaborated with all the sister agencies to ensure that export products get to the ports in a timely and cost-effective manner, all the sister agencies are available in this location once the container is identified to have come out from the DEW, no government agency will stop the container. It is a one-stop shop for all export products before shipment is done.

She further disclosed that the council is working assiduously to address the issue of export rejects by identifying what are the reasons for export rejects.

“We understood that one of the major reasons is administrative in nature, non-compliance with export documentation. Export documentation is very key, it is very important for an exporter to do proper export documentation without which importers cannot access our Export Expansion Grant Scheme

Then the issue of food safety is another aspect that we must address, once the exported products leave the shores of this country and it is tested, there are high level of pesticides are present in the product, this is one of the reasons our products are rejected

Poor packaging, poor labeling, and poor quality, NEPC helps in putting the exporter through with this

Exporters must also adhere to the regulations of the countries they are exporting t Port and trade facilitation” she pointed out.

 Also identifying the way forward, PEBEC Project Manager, Mr Ayokunnu Ojeniyi said the Federal Government has now made it mandatory for Ministries Departments and Agencies (MDAs) to publish their processes and vital information on their websites with the required timelines.

Speaking, Ojeniyi said “MDA’s are now mandated as a requirement to publish processes of licenses, permits, waivers, approvals and other vital information on their websites, this should also carry timelines.

“Each MDA is now required to identify processes, and services that they render, and they have to give timelines to each of these processes and it has to be on their websites. The good news is that this would empower Nigerian citizens to understand.

“Oftentimes when you speak with people at the MDA’s, they give you different information.

The PEBEC Project Manager also said the Federal Government is creating a single customer interface at the ports and airports in order to ensure efficiency and eliminate corruption.

“This means that there has to be a joint inspection, led by the Nigeria Customs Service, different agencies would not be inspecting cargoes differently at the ports,” he said.

Also speaking on the efforts of the Nigeria Customs Service to boost agro-export, Comptroller Babandede Mohammed, the Customs Area Controller, Lillypond Export Command disclosed that the service has collaborated with the NPA, NEPC in establishing Export Processing Terminals (EPTs) in the country with the mandate to undertake stuffing, examination and documents processing.

“We do this to serve as a one-stop shop for the business of export to be effective and efficient and to fast rack export business for quick turnover.

This way, we can decongest the ports, terminals, and port access roads” he added.

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