By Obinna Chima
The Executive Director/Chief Executive Officer of the Nigerian Export Promotion Council (NEPC), Mr. Segun Awolowo has assured exporters in the country that the Export Expansion Grant (EEG), which had been suspended by the federal government would soon be re-introduced.
The federal government had introduced the EEG in 1999 to encourage non-oil exports and cushion the effect of cost disadvantages faced by Nigerian exporters due to infrastructural deficiencies. The grant was planned to be disbursed to qualified exporters in the form of the Negotiable Duty Credit Certificate (NDCC) and utilised by beneficiaries for the payment of customs and excise duty on their export shipments.
The EEG scheme was conceived as a very vital incentive required for the stimulation of export-oriented activities that will lead to significant growth of the non-oil export sector. The scheme was, however, suspended in January 2014 for it to be reviewed.
But Awolowo said the EEG had increased the non-oil export of the country from $600 million to $3 billion, adding that the grant was been reviewed holistically by the Federal Executive Council to lower its threshold. He said the review has since passed through the two relevant ministries, which include the Ministry of Industry, Trade and Investment and the Finance Ministry. He said further that the two ministries were expected to take their recommendations on the EEG to the Federal Executive Council for ratification and onward disbursement of the incentives.
Speaking at the inauguration of the Zero-2-Export project of the NEPC in Lagos recently, Awolowo said an impact assessment has been carried out on the grant, pointing that it would begin to give non-oil exporters 30 per cent incentives as soon as the suspension was over.
“An impact assessment has been carried out on the EEG and it will begin to give non-oil exporters 30 per cent incentives as soon as the suspension is over. The Zero-2-Export initiative is being funded by Fidelity Bank as an active partner in the project and it’s aimed at training individuals and corporate bodies on non-oil export products with information, toolkits and other facilities needed to explore market opportunities,” he noted.
According to him, the programme already has four batches trained in agro-export commodity and processing value added export. While the first batch has done a cumulative export of about $16,000, the second batch with a cumulative export of about $23,500, adding that the second batch has exported 12 tonnes of Hibiscus flowers to Mexico and Ukraine.
Awolowo described the initiative as an integral part of pre-export incentives tailored at equipping potential exporters with the requisite knowledge and practical skills needed to enhance their competitiveness in the market place.
According to the NEPC boss, the importance of the partnership with Fidelity Bank on the Zero-2-Export project cannot be over emphasised, adding that the partnership would ensure regularity of the project in such a scale that would enhance the much-needed capacity building required for export business according to international best practices.
Also speaking at the event, the Managing Director/Chief Executive Officer, Fidelity Bank Plc, Mr Nnamdi Okonkwo, said that the programme was one of the most important steps that should help exporters come out of the present challenges in the economy.
He said the bank would be offering a single digit interest rate for loans granted within three years while loans above three years would be double digits.
“What we are doing is focusing on capacity development to help people learn from mistakes of others and do export properly to earn international respectability”, Okonkwo said.
“As part of our commitment to contribute to the growth of the Nigerian economy, we are collaborating with Lagos Business School (LBS) to establish the Export Management and Export Leadership Institute as a flagship export capacity development programme.
“There is need to reposition the non-oil export sector, which can play significant roles in diversifying Nigeria’s monolithic economy now that the government is pushing everybody to do something productive to earn Nigeria foreign exchange rather than continuing to spend”, Okonkwo added.
