15 years after, Nigeria yet to exploit AGOA benefits – Data, experts
Analysis of relevant data indicates that Nigeria seems not to have utilised the opportunities provided by the African Growth and Opportunity Act (AGOA), a United States of America trade Act, to diversify her economy.
The Act, enacted on May 18, 2000, enhances market access to the United States for qualifying subSaharan African (SSA) countries.
Latest statistics published by the US Department of Commerce indicated that last year, the value of Nigeria’s exports to the US under the AGOA nosedived by N1.57 trillion ($7.88 billion).
The value dropped from N2.33trn ($11.72bn) recorded in 2013 to N764.62bn ($3.84bn).
The report revealed that the 67 per cent drop in US imports from Nigeria were “mostly oil.”
This was an indication that for the past 15 years, Nigeria had concentrated on oil exports to the US, neglecting non-oil exports, despite incentives provided for AGOA-participating countries.
For instance, South Africa’s value of exports to the US in the last two years have remained almost unchanged at over $8bn, more than double of Nigeria’s value for last year.
This is largely because South Africa’s exports were not oil-based and the reduction in oil imports by the US did not significantly affect the country.
While Nigeria is battling to diversify her economy from dependence on oil, some sub-Saharan African countries are benefiting from non-oil exports as US imports (mostly cocoa) from Cote d’Ivoire increased by 19 per cent.
Speaking at the sideline of an event in Abuja, an economist, Mr. Peter Nwaeze, said Nigeria did not exploit the potential of the AGOA and most gains it would have offered Nigeria in the last 15 years slipped off. Nwaeze said the trade Act provided export incentives to participating countries to enable them grow their economies.
“We played with it. The federal government built this country on the false hope that oil will be everything forever,” he lamented.
The president of the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), John Isemede, had recently called for the reassement of Nigeria’s participation in the AGOA. According to Isemede, “Nigeria has been on it but what has been the take-home from AGOA? I am not saying we should pull out. I am not condemning it. However, for Nigeria to continue, we have to assess how we started and where we are today.”
On the low product quality which most times stall exports to the US, the NACCIMA chief told the US authorities, “If you are taking produce from Nigeria and we can’t meet your standard, it is better you come and invest in Nigeria or bring your own experts to come and teach us the standard.”
The Executive Director of the Nigerian Export Promotion Council (NEPC), Olusegun Awolowo told the Daily Trust on Sunday on phone that the report released by the US Department of Commerce did not reflect the true picture of exports to the US as some exports were not captured under the AGOA.
The NIPC boss said a delegation from the Council just returned from the AGOA and the Council has achieved gains from the trade Act.
The US has extended the implementation of the AGOA, which had this year as its initial deadline, by additional 10 years.
It is expected that Nigeria will regain the lost opportunities of the past 15 years within the next 10 years by concentrating on non-oil exports in order to build a zero-oil economy.