Two years in the saddle, efforts of President Buhari’s Administration on industry, trade and investment have shown that the government has made giant strides in policies formulation and implementation. KINGSLEY ALU AND OLAJIDE FABAMISE write on the journey so far.
Nigeria Launches Economic Recovery And Growth Plan
The federal government launched the Economic Recovery and Growth Plan (ERGP), a medium term plan for 2017 – 2020.
The plan focuses on achieving macroeconomic stability and economic diversification. Macroeconomic stability according to the government, would be achieved by undertaking fiscal stimulus, ensuring monetary stability and improving the external balance of trade.
Similarly, to achieve economic diversification, policy focus would be on the key sectors driving and enabling economic growth, with particular focus on agriculture, energy and MSME- led growth in industry, manufacturing and key services by leveraging science and technology.
While speaking at an event in Washington, D.C., organized by the Center for Strategic and International Studies, Okechukwu Enelamah, the Nigerian minister of industry, trade, and investment, said government would be working closely with the private sector to ensure an effective implementation of the plan. Enelamah also stressed the importance of partnerships with international institutions at all levels.
“People tend to work in the area where they have a burden, where they have an interest, and that is where we need global development institutions. They could pick their areas and work with us in those areas because we need a lot of capacity to get the result we seek,” he said.
He explained that the ERGP’s top priorities aim to strengthen the food and agribusiness sector, improve infrastructure and energy provision, and implement a robust industrialization of small- and medium-scale enterprises.
According to him, Its successful implementation would enable Nigeria achieve a diversification and job creation agenda while improving its trade and investment landscape.
An industrial council led by a representative of the private sector selected by the government would oversee the plan, Enelamah added.
He explained that the government aims to support the private sector’s diversification efforts in the digital industry through a smart digital economy project or initiative.
FG Announces New Tomato Policy, Increases Tarrif To 50%
The federal government announced a new policy for tomato aimed at reducing N52 billion spent on the annual importation of 150, 000 metric tons of tomato concentrate through the neighbouring countries into Nigeria.
Minister of Industry, Trade and Investment (MITI), Okechukwu Enelamah informed that the policy was aimed at promoting local production of fresh tomato fruit required for fresh fruit consumption and processing and also increase local production of tomato concentrate and reduce post-harvest losses.
Enelamah, said the policy was expected to create at least 60,000 additional jobs in fresh fruits production and processing.
According to him, the policy restricts the importation of tomato concentrates to the seaports to address the abuse of the ECOWAS Trade Liberalisation Scheme (ETLS), stops the importation of tomatoes preserved otherwise by vinegar or acetic acid; and increases the tariff on tomato concentrate to 50 per cent with an additional levy of $1,500 per metric ton.
Nigeria imports an average of 150,000 metric tons of tomato concentrate per annum valued at $170million mostly due to inadequacy in capacity to produce tomato concentrate.
Current demand for fresh tomato fruits is estimated at about 2.45million metric tons per annum while the country produces only about 1.8million Metric tonnes per annum.
The minister said the Federal Executive Council (FEC) approved the policy and the implementation of certain extraordinary price-based measures to safeguard the balance of payments, under the condition of recession.
Implementation of the new policy is expected to commence from May 7, 2017
Also speaking at a management retreat, penultimate week in Markurdi, Benue State , the minister assured that the new measure is at the core of the Nigeria Industrial Revolution Plan (NIRP), which prioritises agro-allied businesses, an area that the country has comparative advantage.
According to him, prior to the new policy, farmers lost about 50 per cent of their tomato harvest as there were no enough processing plants to buy the fresh produce and turn them into concentrate, while the heavy losses according to him discouraged the farmers from cultivating more tomatoes.
The new policy he explained, would encourage farmers to cultivate more tomatoes, earn more money as they sell to processing plants and with decrease in importation of concentrate, the nation saves huge sums in foreign exchange.
New Investment Promotion Agenda Unfolded
The federal government unveiled plans to pursue a new initiative that would bring Nigeria from 189th to less than 100th position in the ranking of business-friendly economies by 2019.
At a forum organised by Deloitte Nigeria for top company executives in Lagos, the Minister of Trade, Investment and Industry, Okechukwu Enelamah, said the government was working to ensure that drastic, fast-paced business reforms were initiated simultaneously to improve the business environment and attract foreign investors.
Nigeria moved up one place in the ‘Ease of Doing Business’ in 2015, but still ranks 36 out of 47 countries in sub-Saharan Africa.
Enelamah said reforms must be adopted within the next 12 months to reflect positively in the 2018 ‘Ease of Doing Business’ report.
The minister pointed out that despite the economic challenges bedevilling the country, the fundamentals of the Nigerian economy remain strong in the mid-term.
Building on President Muhammadu Buhari’s recent trips outside the country, he disclosed that the administration was implementing strategic partnership framework with countries to boost bilateral trade with such nations like China, United Arab Emirates, China, U.S. and Singapore.
Besides, he noted that the government would use special economic zones and industrial parks to catalyse the implementation of Nigeria Industrial Revolution Plan (NIRP) with emphasis of infrastructure.
Already, he said the government has set ambitions of providing funds and technical assistance to one million beneficiaries of Small, Medium Enterprises (SMEs).
FG Introduces N25bn Loan Scheme For Transport Coys
The federal government also set up N25 billion revolving loan scheme for transport companies in the country to access funds for purchase of mass transit vehicles.
Minister of Industry, Trade and Investment, Mr Okechukwu Enelamah, said at the opening of a two-day national workshop for chief executives of mass transit companies in Abuja.
Enelamah said that the initiative was aimed at boosting the country’s mass transit system as well as encouraging local patronage of local vehicle assembly plants.
He explained that the loan would be administered through the Infrastructure Bank at zero per cent interest rate.
The workshop was organised by the National Automotive Design and Development Council (NADDC) in collaboration with the Nigerian Institute for Transport Technology (NITT), Zaria.
The theme of the workshop is “Nigeria Automotive Policy: A National Agenda for Sustainable Mass Transit Operation Development.’’
“Government is determined to develop the automotive industry because of its extensive linkages, impact on job creation, technology transfer as well as foreign exchange savings and earnings.
“The response by investors has been encouraging and we have brought back vehicle assembly and are now focussing on local content development.
“Many of the new assembly plants produce buses and mini-buses. I hereby call on all Nigerians to patronise the products of these assembly plants,’’ he said.
FG Resumes Export Expansion Grant
The federal government announced that it would resume the Export Expansion Grant (EEG) scheme in this year to expand the volume and value of exports, diversify export products and improve global competitiveness of exporters.
At a news conference in Abuja, Minister of Industry, Trade and Investment, Okechukwu Enelamah, said the scheme would be included in the budget, to manage the impact on government’s revenue and promote transparency.
He said that approved liability on the scheme for unused certificates would be settled after the conduct of an audit to verify the actual amount due.
Enelamah disclosed that an inter-ministerial committee has been set up following the EEG suspension, to access the scheme holistically and make recommendations on framework for its continued operation.
According to him, there was ongoing negotiation of 21st century Nigerian free trade agreements to expand market opportunities for companies as well as look into the ECOWAS Common External Tariff that had been controversial.
He said the ministry was running a feasibility study for the development of six Special Economic Zones and securing funding in the budget for the first development phase to be launched in 2017.
According to him, specific goals include to help overcome the infrastructure disadvantages faced by local manufacturers and promote the cluster effects gained by locating similar manufacturing businesses together.
Enelamah said the ministry was also updating the Nigeria’s trade policy priorities to correct the imbalances in the country’s trade relationships and reversing failures.
According to him, one of the items being examined at the moment is the Economic Community of West Africa States’ CET.
The CET is a regional tariff structure for West Africa on the basis of which products are imported within the region.It came into effect in 2015, with a transitional period of implementation to 2020.
“The challenge for the economy is that manufacturers and industrialists said that the negotiation that resulted in the CET did not take into account the sensitivities of industrial and manufacturing sectors,” the minister said.
The minister said that the pre-existing sensitivities had been compounded with the onset of the recession and other vulnerabilities.
He said that stakeholders believed the economy would be damaged if the CET was implemented in 2020, and that the situation would be compounded if Nigeria signed the Economic Partnership Agreement (EPA) with the European Union.
“As a consequence, producers, manufacturers, industrialists and others have requested for the postponement and negotiation of the CET and for the EPA not to be signed,” he explained.
N1.4bn Committed To Industrial Clusters, SEZs Development
The federal government also committed the sum of N1.4 billion to the pre-development phase and N50 billion to stage one development in 2017, for the establishment of six Special Economic Zones (SEZs) and Industrial Clusters in the country.
Minister of Industry, Trade and Investment, Okechukwu Enelamah, who made this known at the 5th edition of the EU-Nigeria business forum, said the Pre-development studies on the six pilot SEZs in Nigeria which would be built to world class standards will commence next month, adding that, “Afreximbank and China Exim Bank have committed $1billion into the project.”
Commenting on the creation of an enabling environment to improve the Ease of Doing Business, EODB, based on a Presidential initiative, he said,“Work has commenced on setting up the structure to support the initiative on the EODB, the supporting secretariat has been set up and is functioning in the Nigeria Investment Promotion Commission (NIPC). Knowledge experts and technical consultants to support the team have been constituted.
“The Nigerian Industrial Revolution Plan, NIRP, priorities are agribusiness and the agro-allied sector, auto-assembly and component manufacturing, sugar, food processing (tomato and fruit juice), textiles and garments, palm oil processing and leather and leather products.
“These are the sectors where SMEs are operative. Specific programmes are being implemented at various stages,” he noted.