The Central Bank of Nigeria, in conjunction with bank chief executives, continued with the implementation of the Race to $200 billion Non-Oil Export Earnings, RT200, program by holding the maiden edition of the biennial Non-Oil Summit with the theme “Setting the Roadmap toward Achieving RT200”.
Introduced in February this year, the RT200 comprises a set of plans, policies, and programs designed to increase the nation’s earnings exclusively from non-oil exports to $200 billion in foreign exchange repatriation, within the next five years.
The RT200 initiative is designed to be implemented through five anchors: Value Adding Exports Facility (VEF); Non-Oil Commodities Expansion Facility (NCEF); Non-Oil FX Rebate Scheme (NFRS); Dedicated Non-Oil Export Terminal; and the hosting of a Bi-annual Non-Oil Export Summit
Three months after the program was introduced, the CBN commenced the implementation of the Non-Oil FX Rebate Scheme (NFRS). The scheme was designed to incentivize exporters in the non-oil export sector to repatriate and sell their export proceeds in the local foreign exchange market and earn a rebate. Under the scheme, the CBN pays non-oil exporters N65 for every $1 repatriated and sold at the I & E Window to authorized dealers and banks (ADBs) for other third-party use, and N35 for every $1 repatriated and sold into I&E for own use on eligible transactions only. The payment of the rebate, which is quarterly, commenced in April with 150 exporters receiving N3.5 billion as a rebate for selling $60 million of export proceeds through the I&E window.
Non-Oil Export Summit
Following the successful commencement of the rebate scheme, the CBN and the banks last month organized the maiden non-oil export summit to mobilize stakeholder support and harness ideas on how to increase the volume and value of non-oil exports out of the country.
According to Osita Nwanisobi, Director, Corporate Communication Department, CBN, the one-day summit specifically seeks to identify challenges across the non-oil export value chain from the perspectives of all stakeholder groups as well as provide an understanding of the current situation and the implications for Nigerian citizens and the economy as a basis for urgent action.
“Other objectives of the summit include understanding trends and lessons from other countries, including regional and global market outlook; sharing best practices across the agriculture exporting value chain; obtaining guidance on how to obtain financial assistance; and identifying opportunities for improving the performance and viability of non-oil exports. He said that ultimately, the CBN and its partners, through the summit, seek to launch the development of a comprehensive non-oil export optimization framework.
The summit, which was held in Lagos on Thursday, June 16th, was declared open by the Governor of Lagos State, Babajide Sanwo Olu.
A problem-solving summit
The summit, according to CBN Governor, Godwin Emefiele in his keynote speech, is aimed at harnessing ideas that will help the country achieve the ultimate goal of $200 billion in non-oil exports over the medium term.
Emefiele said: “In continuation of the implementation of the RT 200 program, we are gathered here today for the maiden edition of the biannual non-oil export summit to harness ideas on how we can increase the value and volume of exports in the country and improve the availability of foreign exchange therefrom.” As things now stand, we really have very little choice left but to look inwards and find innovative solutions to our problems.
“It is my earnest hope that at the end of the summit today, presenters, panelists, and participants will put on their thinking caps and come up with even more innovative solutions to the problems of non-oil exports in Nigeria.”
“I am delighted to see that many of the agencies, businesspeople, financiers, and practitioners in the non-oil export space in Nigeria are present here. While I warmly welcome you all to this event, my hope is that this will be a problem-solving gathering. A summit that will guarantee that for every complaint, problem, issue, challenge, or difficulty that is presented or identified, there will be one or several agencies or practitioners that can articulate options for solving that problem.
“I strongly believe that the ideas harnessed from this maiden summit would be invaluable in helping us reach our ultimate goal of $200 billion in non-oil exports over the medium term.”
Potential to increase non-oil exports
While commending the CBN and the banks for organizing the summit, Governor Sanwo-Olu, said, Nigeria has so much potential to scale up its non-oil exports, shifting from over-dependence on oil and gas to agricultural produce, solid minerals, chemical products, furniture, and clothing, among others.
Noting that Lagos state is the home to the biggest and most important sea ports in the country, the Lagos State Government, he averred, has the responsibility to ensure that we make the business of exporting (and also importing) as seamless as possible.
He said: “Lagos State is home to the biggest and most important sea ports in the country.
There cannot, therefore, be any conversations about growing non-oil exports in Nigeria, without bringing Lagos State and our transport and logistics infrastructure into the picture. This is why I am pleased that Lagos is hosting the maiden Summit.
He said: “For us as a government, a lot of the work we have been doing and still doing is aimed at improving the state of transportation infrastructure, to enable imports and exports, and generally bring down the cost of doing business.
“When goods for export get stuck on the roads and can’t make it to the ports, we have a big problem on our hands. There is a big price that the economy pays for these dysfunctions at all levels – from the small and large businesses whose goods are being exported to the people in the business of exports, to the users of our roads who have to waste valuable time in traffic because of worsening gridlock.
“It is, therefore, our responsibility, as governments, to ensure that we make the business of exporting (and also importing) as seamless as possible. Nigeria has so much potential to scale up its exports, shifting from over-dependence on oil and gas to agricultural produce, solid minerals, chemical products, furniture, clothing, and so on.”
Working Group to address constraints
A major highlight of the summit was the decision of the CBN to team up with the Nigeria Port Authority and the Nigeria Customs Service to form a working group to identify and implement measures to address constraints to non-oil exports.
Among other things, the working group is to take measures to tackle logistical and documentation challenges to the export of non-oil commodities out of the country.
While announcing the need for the workgroup, Emefiele, said that achieving the $200 billion in non-oil export earnings requires the partnership and support of all the government agencies and stakeholders.
Emefiele’s comments followed recommendations from the first-panel session of the summit, focussed on “Addressing the Logistical Constraints to improve Non-Oil Export”, which featured presentations and recommendations by the Managing Director of NPA, Mohammed Bello-Koko; Deputy Comptrollers General (DCG), Nigeria Customs Service, Elton Edorhe; Chairman, Committee of Banks’ CEOs and MD of Access Corporation, Mr. Herbert Widgwe, and the MD/CEO of Ecobank, Bolaji Lawal.
Emefiele said: “I want to appeal to Koko of the Nigerian Ports Authority and the Nigerian Customs that we establish a working group comprising the Bankers Committee, NPA, the Nigerian Customs and maybe a member of the shipping lines to resolve two issues.”
“We have heard of people who want to export their goods queuing for weeks or months before their goods can go out. Because time is against us, in the short run, what can the NPA and customs do for the exporters, whether they want to create or set up a dedicated route from which they can easily export their goods?
“We need those export proceeds badly.” It is sad that, because of the problem of finding an easier route for goods to be exported out of the country, Nigerian exporters prefer to transport them by road or sometimes by barge from Lagos to Accra or the Republic of Benin to export from there. By doing this, we lose the opportunity to earn export proceeds. In Customs and NPA in the working group, we want you to look at the long run and the short run.
“In the short run, look at how we can immediately create a dedicated export route for exporters so that their goods can leave. Many of those containers that bring goods into the country go out empty because of these problems.
“Let us work on finding a dedicated route where exports can go out easily. In the long run, we can talk about how we can go through Lagos.
Free Trade Zone to create a road that will take the goods through some express road. The Lekki Port has a blueprint of a road that goes to Ondo, which is about 50km. IntraCorp is ready to fund that if those of us can yield in. So in the medium term, the road for Lekki Ports and in the Long term we can talk about Badagry, Bonny, and Ondo ports”.
