The Managing Director of the Nigerian Ports Authority (NPA), Hadiza Bala-Usman, has explained that the agency in line with the directive of the federal government created an opportunity for goods to be exported to get to the port, saying non-oil export remains vital for Nigeria’s economic transformation.
She said the government created priority time for export goods to get to the port despite the gridlock on the port access roads so as to drive export, which has become very important as the country looks to diversify from oil.
However, she noted that most exporters have a habit of doing their documentation when they get to the port, stressing that doing so before moving goods to the port helps to preserve the cargo.
She made the disclosure while speaking at a webinar tagged, “Non-oil export: Disrupting Nigeria’s Growth Cycle, “organised by BudgIT recently.
While stressing the need for the Nigerian economy to be export-driven, Bala-Usman said 78 per cent of total export through the port in 2019 was crude oil export, adding that a decline in oil export would result to low port utilisation and decline revenue from the port for government.
“About 191 MT tonnes of cargo were exported through the port in 2019 and 78 per cent of it was crude oil export. We are prioritising non-oil export but the exporters have to know that you don’t get to the port before doing documentation.
“We must also know that multi-modal means of transportation is what will solve the problem of congestion. This is why the Ministry of Transportation is aggressively working on deploying railway at the port. Also we must utilise the inland waterways and move cargo by barges and we have signed an agreement to that effect.”
Bala-Usman, noted that the COVID-19 pandemic has once more exposed the vulnerability of the Nigerian economy to oil-related shocks.
“It underscores the need for Nigeria to look outward, diversifying its export base away from the volatile commodity if the country is to win its battles against poverty and inequality.
“A recent report has indicated that a unit increase in non-oil export stimulates the growth of the Nigerian economy by 0.03 percent. This outcome reveals the grossly underdeveloped state of the non-oil sector of the Nigerian economy.
“Also, data from the National Bureau of Statistics (NBS) shows the monetary value of the goods exported during the period. According to the NBS, Nigeria shipped $53.6 billion worth of goods around the globe in 2019, “she said.
Bala-Usman also expressed worry about the data, saying that with falling oil prices, it was not a good signal for the economy
“Nigeria is currently the largest African crude oil producer, and the resource accounts for 90 per cent of its exports and foreign exchange earnings and 60 per cent of government revenues.
“Nigeria’s crude shipment is tied to exportation and it contributes to the highest revenue of the ports, ”Bala-Usman said.
She added that with the reduction in oil shipment and price, occasioned by the COVID-19 pandemic, the revenue of the government from the port was likely to decline, stressing that it was time to increase the shipment of non-oil exports.
“This underscores the importance of diversification of the economy through non-oil exports so that we can reverse this trend. “There is a need to encourage local investors. We are a large country of consumers; we need to increase local production. We need to make domestic investment a priority,” she said.
Also speaking during the online seminar, the Executive Secretary/Chief Executive Officer, Nigeria Investment Promotion Council (NIPC), Yewande Sadiku, said the pandemic may see foreign direct investment (FDI) into African countries fall by between 30 to 40 per cent between now and 2021.
She agreed with Bala-Usman on the need to strengthen the local production base and increase non-oil export while also attracting more FDI.
Also speaking, the Publisher of Nairametrics, Mr. Ugo Obi Chukwu reiterated the need for the country to do away with reliance on crude oil.
He noted that the naira exchange rate could depreciate if the country does not diversify its external revenue base.