How Nigeria can diversify its exports

Nigeria, known for its rich mineral resources, particularly crude oil, has been facing a decline in its exports. Latest data from the National Bureau of Statistics revealed a 31 per cent decrease in exports, amounting to 6.3 trillion naira. Spain and the Netherlands emerged as top destinations for Nigeria's exports, emphasizing the need for the country to diversify its export portfolio. To delve deeper into Nigeria's export diversification strategy, Akin Laoye, Executive Director of FTN Cocoa Processors, and Nnamdi Nwizu, Co-Managing Partner at Comercio Partners, joined CNBC Africa's Kenneth Igbomor in a conversation that shed light on the challenges and potential solutions. Key Points: 1. The African Continental Free Trade Area (AfCFTA): With the AfCFTA set to commence in January, Nigeria has an opportunity to leverage this regional trade agreement for economic growth. Nwizu highlighted the importance of empowering businesses to participate effectively in the AfCFTA, emphasizing the need for accurate information on African markets, credible partnerships, and discussions on volume, value, and concessionary arrangements. 2. Challenges in the Manufacturing Sector: Despite Nigeria's competitive advantage in terms of size and population, the manufacturing sector faces obstacles such as inconsistent power supply, inadequate infrastructure, and poor roads. Nwizu urged the government to focus on revitalizing existing manufacturing capacities, particularly in sectors like textiles and fast-moving consumer goods. Enhancing logistics and transportation networks will be critical to boosting exports. 3. Private Sector Initiatives: Dangote Cement's export strategy exemplifies the proactive approach the private sector can take in enhancing Nigeria's exports. By investing in export terminals and exploring alternative logistics options, private companies can contribute significantly to the country's export diversification efforts. However, the government's support is crucial in addressing logistical challenges and creating a conducive environment for trade. The conversation also touched upon the issue of border closures and the need for trust among trading partners within the AfCFTA framework. While Nigeria has established companies with strong manufacturing capabilities, the focus remains on overcoming infrastructure challenges and fostering a business-friendly environment. Quote: Akin Laoye highlighted the importance of private sector involvement in export diversification, stating, 'If we continue to wait for the government, we may not be able to get anywhere. Every other company in the private sector should follow Dangote's strategy to enhance exports.' As Nigeria navigates its export diversification journey, strategic partnerships, infrastructure development, and private sector engagement will be pivotal in driving economic growth and expanding the country's export markets. With the AfCFTA on the horizon, Nigeria stands at a critical juncture to leverage regional trade opportunities and transform its export landscape for a sustainable future.