Monday, March 18, 2019

Is The Diversification Drive of PMB Yielding Result in Non-Oil Export?

The diversification drive of the administration of President Mohammadu Buhari appears to be yielding some results in the non-oil export sector of the Nigerian economy. This is as a result of the consistency in the upward swing of the non-oil export volume since 2016. The report of foreign trade statistics released by the National Bureau of Statistics for the fourth quarter of 2018 revealed that non-oil export contribution to the total export from Nigeria in 2016 was about 4%, and this increased to about 4.6% in 2017 and the year 2018 witnessed a further increase to 6.2%. The increase seen in the growth of non-oil export in 2017 and 2018 are 15% and 35% respectively. 

The major contributor to this growth contributed more than half of the total non-oil export volume and that is the manufacturing sector, which contributed about 54.2%. This is followed by Agriculture which contributed about 25.4% being half of the total contribution from the manufacturing sector. The fact that manufacturing could surpass Agriculture despite the fact that the government effort is more towards Agriculture should make the administration of PMB to take the manufacturing sector more seriously during his second term in office.  

Even though, the significant growth in the non-oil export sector can be attributed to the diversification drive of the Buhari's administration on one hand, but more importantly on the other hand is the fact that a lot of Nigerian Manufacturers are waking up to the reality of generating their own foreign exchange through exportation having suffered greatly from the shortage of foreign exchange that bedevilled the economy of Nigeria during the last economic recession. This affected many manufacturers who largely depend on importation for their raw materials by making them to incur huge losses resulting from increased exchange rate and delay in getting the foreign exchange.

The fact that the non-oil export sector experienced such a tremendous growth despite the construction of the port access road and the abnormal delay being experienced by the exporters in entering the port, is a pointer to the resilience of the Nigeria exporters on one hand and the humongous potential of this sector on the other hand. I strongly believe that the PMB administration did not pay too much attention to exportation in his first term and I think this second term present to him the opportunity to take this sector more seriously in order to harness the potential of this sector for the betterment of the a Nigerian populace. 

Finally, I will like to bring to the attention of this administration, that top economies of the world are exporting economy. The government should make a deliberate effort this time around to grow non-oil export by signing African Continental Free Trade Agreement (AFCFTA), launching programmes on exportation, appointment of a Special Assistant on non-oil export, setting up committee that will regularly work with the relevant government agencies and report to the president every month on the proposals and programme to grow the sector, problems encountered in the sector, promotional activities for Nigerian products and progress being made in the sector.

Bamidele Ayemibo

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