Non-oil exports rise by 205%, hit N942bn in five years

Nigeria’s non-oil exports rose from N458.6bn recorded between January and September 2017 to N1.4tn within the same period of 2021, according to an analysis of data from the National Bureau of Statistics.

This means that within the five-year period, non-oil exports rose by N942bn or 205 per cent.

A breakdown of non-oil exports within the period under review showed that in the first quarter of 2017, non-oil exports stood at N170.6bn, but fell to N161.57bn in the second quarter and dropped further to N126.47bn in the third quarter of the year.

These brought the value of non-oil exports in the first nine months of 2017 to N458.64bn, which is 4.7 per cent of total exports made during the reviewed period.

Further analysis of data from the NBS shows that in Q1 2018, non-oil exports rose sharply to N577.6bn, but dropped to N218.4bn and N163.3bn in Q2 and Q3 respectively, bringing total non-oil exports within the reviewed period to N959.3bn.

The N959.3bn non-oil export accounted for 6.9 per cent of the total exports of N13.8tn recorded within the reviewed period.

In 2019, the value of non-oil exports in Q1 stood at N604.4bn; it ballooned to N1.08tn in Q3 after falling to N277.6bn in Q2.

The total value of non-oil exports between January and September 2019 was N1.8tn, about 12.4 per cent of aggregate export during the reviewed period.

Non-oil exports stood at N611.2bn in Q1 2020, N352.9bn in Q2, and N214.6bn in Q3, bringing the total non-oil exports within the period under review to N1.2tn.

During the reviewed period, export was dominated by crude-oil which accounted for 63 per cent of total exports while non-oil products accounted for 13 per cent.

The NBS stated that in Q1 2021, non-oil exports stood at N455.4bn; it rose to N462.8bn in Q2 2021 and jumped to N546.2bn in Q3.

These showed that non-oil exports stood at N1.8tn in the first nine months of 2021, which accounted for 13.7 per cent of the N13.1tn exports recorded as at September 30, 2021.

While there was a significant increase in non-oil exports during the five-year period, a cursory look at the export component of each year showed that crude-oil exports accounted for a large chunk of the total exports recorded.

For instance, between January and September 2021, crude oil export accounted for 80.6 per cent of the total exports recorded within that period.

This was despite the various programmes and initiatives introduced by the government to shore up non-oil exports.

For instance, in 2016, the Federal Government through the Nigerian Exports Promotion Council instituted the zero-oil plan, a core component of the Federal Government’s Economic Recovery and Growth Plan, to increase the contribution of non-oil exports to Nigeria’s Gross Domestic Product by 20 per cent.

According to the NEPC 2016 annual report, the focus of the plan is to ‘generate at least a minimum of 40 – 50 per cent of Nigeria earnings from non-oil export.’

Among other things, the report disclosed that the plan was expected to grow non-oil foreign exchange to $30bn by 2020.

The $30bn was to be generated from 11 strategic export products – such as petrochemicals, palm oil, cocoa, soybeans, rubber – with high financial value to replace oil.

The $30bn target when converted to naira using the current official exchange rate of N411/$ equals N12.3tn.

Speaking on the development, financial analysts explained that the growth in non-oil exports could be attributed to some of the listed initiatives which were effectively implemented.

A professor of Economics and Public Policy at the University of Uyo, Akpan Ekpo, said the upward trend in non-oil exports was as a result of increased agricultural goods export backed by government interventions.

“There are a lot of government policies to encourage non-oil exports, especially among small and medium-scale industries. For instance the NEPC provides various incentives to the SMEs that encourage exportation.

“A lot of people do not know that we export a quite a number of agricultural products such as snails and ginger to neighbouring countries. So the reason for the upward trend is agricultural exports.

He however stated that crude oil remains Nigeria’s top export product and foreign exchange earner.

Ekpo emphasised the need for the Federal Government to diversify the economy by creating conducive spaces for the manufacturing sector to strive, adding that the exportation of manufactured goods could significantly boost foreign exchange generation.

He said, “Crude oil is still our major export, it is through it that we earn our foreign exchange and generate revenue.

“The message is that the government should try to put in place policies that will diversify the economy, not just talking about it. The country must be industrialised so that we export non-oil products with real value.

“What I mean is that, our current non-oil export portfolio shows that we are exporting a lot of agric product which isn’t generating enough foreign exchange.

He further explained, “Also, focus must be placed on diversifying the economy and not just the GDP. What this means is that, currently the GDP is diversified into 46 sectors but the economy is not, in other words, manufacturing only contributes about 8-10 per cent to the GDP.

“For us to change this narrative, we must address the challenges in the sector which will lead to increased production, enough production to contribute at least 30-35 per cent to the GDP.

“Until we do that, oil will continue to be our major export and this is dangerous because there are projections that oil will go extinct soon.

“Also, the revenue from oil isn’t certain as the government doesn’t control the price or the output that is under the purview of OPEC.”

He also urged the Federal Government to use the revenue currently generated from the export of crude oil to boost production in critical sectors of the economy.

Another expert and senior lecturer in the Department of Economics at the Pan Altalntic University, Olalekan Aworinde, said there is huge potential in the non-oil sector if properly harnessed.

“There is a lot of revenue to be generated in this country if the government will focus on non-oil products.

“To shore up non-oil exports, we must shift from the exportation of raw materials to semi-finished goods with higher value, create good bilateral relationships that encourage trade, not just imports, an enabling environment for business growth and institute policies that favour growth in critical sectors,” he added.

 

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