NEPC’s non-oil exports drive boost diversification

…as the Zero Oil plan plan begins to yield dividends

By AYOOLA OLAOLUWA

The efforts of the Federal Government in accelerating Nigeria’s economic diversification through non-oil exports have continued to yield dividends with the country’s non-oil exports increasing from N1 trillion to N2 trillion in one year.
According to the National Bureau of Statistics (NBS), the value of Nigeria’s crude oil exports decreased by 3.78%, as non-crude oil exports rose by over 30% in value between 2018 and 2019.
The NBS disclosed that the total value of exports grew by 2.5% to hit N14.4 trillion as at third quarter of 2019 while total value of imports in 2019, as at the third quarter stood at N11.6 trillion, compared to N9.6 trillion as at third quarter of 2018.
“Strong performance in the external sector suggests increasing diversification of exports and export revenue. This resulted in a stronger overall performance and an increase in the value of total trade by 10% between 2018 and 2019. This represented an annual growth rate of 21% between 2018 and 2019,” said NBS.
Business Hallmark findings revealed that the accomplishment is largely attributed to the efforts of the Nigerian Export Promotion Council (NEPC), an agency with the mandate to enhance the nation’s non-oil exports for increased revenue. While the Federal Government had over the years set up various incentive schemes for Nigerian companies whose businesses are export focused, NEPC had been at the forefront of realizing this objective.
The council, though, created in 1976, until recently, has not been able to live up to expectation. However, in the last six years, NEPC under the leadership of its Chief Executive Officer (CEO), Mr. Olusegun Awolowo, has strived to make the non-oil export a significant contributor to Nigeria’s GDP by facilitating exports to promote sustainable economic development.
Following the consistent fall in the price of crude oil which later pushed the country into recession three years later, President Goodluck Jonathan was forced to effect a change in the leadership of NEPC in 2013 in bold a move to enhance Nigeria’s non-oil exports for increased revenue.
The unenviable task fell on the lap of the newly appointed chief operating officer, Mr. Segun Awolowo, who immediately hit the ground running by launching series of initiatives towards fast-tracking the growth of non-oil exports in Nigeria as a means of reviving the national economy.
On his assumption of office in 2013, he had declared that under his leadership, NEPC’s target is to ensure that Nigeria always attains a balance of trade in its international trade, stressing that with the commitment by the agency for export promotion, the country will soon be in a position to offset its import bills with proceeds from exports.
Seven years after, available figures indicate that NEPC under the new management had largely lived up to expectations.
BH findings revealed that NEPC under Awolowo began to develop strategies to accelerate the diversification of the Nigerian economy through exports long before the recession with the launch of its flagship program called ‘Zero Oil’ plan.
The ‘Zero Oil’ plan provides a roadmap to replace oil as the major national foreign exchange earner through carefully conceptualized interventions. The plan is one of the key components of the Federal Government’s Economic Recovery and Growth Plan. The goal is to grow national earnings from non-oil exports first to $8billion and eventually $25 billion.
The ‘Zero Oil’ plan also aims to diversify the country’s export base away from exporting raw commodities to value added products, increase participation of SMEs in export trade by 50%, achieve $706 million in non-oil export to the West Africa Sub- region and create 1.5 million new jobs in the SME sector by 2020.
The Zero Oil plan is based on three major trust, namely the One State One Product initiative (OSOP); Nigeria Diaspora Export Programme (NDEX) and the Selecting Export Products (SEP).
Under the selected export products plan, products such as palm oil, cocoa, cashew, sugar, rice, cement, iron ore/metals, auto parts/cars, aluminum, petroleum products, fertilizer/urea, petrochemical and methanol are given priority to ensure that sufficient income can be earned to replace lost national revenues within a reasonable investment cycle.
Also, the One State One Product initiative is an essential part of the Zero Oil plan, whereby, all states of the federation identify at least one strategic export product based on their comparative advantage from which Nigeria can earn foreign exchange.
However, states are not limited to choosing only one item. For instance, Enugu state continues to successfully export pineapples into the European market, despite choosing other products for OSOP.
Another key component of the “Zero Oil” plan is the Nigeria Diaspora Export Programme. It is meant to leverage on the opportunity provided by the huge population of Nigerians overseas, by promoting commercial, cultural and social development of our people.
NDEX has initiatives such as, Nigerian Heritage City, NHC (a business and cultural enclave akin to Chinatown, a venue where national cultural values can be projected and visitors can experience/purchase Nigerian goods and services across global cities.) and the Nigerian Cuisine Beyond Borders, NCBB (which promotes Nigerian cuisines at restaurants in major cities around the world for the purpose of attracting export-oriented investments by Nigerians in the diaspora.)

Since inception, NEPC has devoted its time and resources to assisting several export related industries in its drive to boost their productivity and in effect the nation’s income. An example is the agricultural sector, particularly the cashew industry, where the council’s targeted interventions are aimed at improving quality standards and safety, training local farmers on planting and harvesting best practices, the provision of jute bags for farmers, marketers and exporters, providing assistance with market linkages.
In the past three years, Nigeria has witnessed a steady increase in cashew product. Cashew nut production has grown in commercial quantities in 17 of the nation’s 36 states and Nigeria is now one of the world’s top 10 raw cashew nut producing countries in the world.
NEPC is also assisting the Nigerian textile and garment sector. According to the council, the fashion industry globally is estimated to be worth $2trillion by 2020. It lamented that despite Nigeria’s abundance of excellent designers and creative talents, the country has not been able to make any significant mark in the export of textiles and apparels.
“Our challenges range from weak production capabilities and lack of proper coordination among operators in the sector to limited knowledge of market requirements and challenging operating environments”, lamented Awolowo.
In order to address the shortcomings, NEPC embarked on key initiatives such as the rehabilitation of the Human Capital Development Centre (HCDC) in Lagos to enhance capacity for the sector; improve market understanding by supporting designers to participate at the world’s largest apparel sourcing event, Magic Fair, Las Vegas (2014, 2015 and 2016); entered strategic partnerships with multi-laterals (UNIDO, USAID) and private (Style House) sector stakeholders on capacity development for the sector.
It is also in collaboration with relevant government agencies and state governments on Common Facility Centres as a basis to attract investment to the industry.
As part of the Zero Oil plan initiative, the council identified 22 countries that have demonstrated a consistent capacity and high demand for purchasing Nigerian products. These countries are considered as primary targets because of their proven track record of importing Nigeria’s strategic export products in large quantities.
Awolowo stated that Nigeria’s largest trading partners, Netherlands, U.S.A and South Africa are experiencing increasing demand for oil palm and cocoa, nitrogenous fertilizer and ammonia in addition to agricultural products such as sugar, rubber and cocoa and rice.
“If Nigeria is able to capture only 5% of the international market share in these five sectors, the country could earn an additional US$8.25 billion. As more and more states and government agencies key into the vision of the Zero Oil initiative, especially now that it has been included in the national Economic Recovery and Growth Plan, I am optimistic we shall see steady growth in the percentage of non-oil revenues in the coming quarters”, he said.
To further develop the export market in Nigeria, NEPC introduced two primary incentives – the Export Expansion Grant (EEG) and the Export Development Fund (EDF). The EEG and EDF are post and pre-shipment schemes respectively for the purpose of helping all businesses in the export space from SMEs to large corporations.
The council however regretted that many Nigerian entrepreneurs are not taking advantage of the opportunities that abound in the export sector.
“Businesses in Nigeria have the ability to play a crucial role as engines of growth in our country. Empowering their development means creating wealth, reducing poverty and creating more jobs for Nigerians. If every single one of our over 17million SMEs was encouraged and supported to hire an additional 1 or 2 staff, over 30 million jobs would be created.
“Entrepreneurs should continue to take advantage of the various resources on offer to them from different government agencies such as NAFDAC, SMEDAN, NEXIM, CBN, Federal Ministry of Agriculture and Rural Development, Ministry of Solid Minerals and business friendly commercial banks.
“The Export Development and Incentive Directorate, (EDI), within NEPC, is available to support those who desire to export. Nigerian businesses must learn from each other, share information and embrace mentorship and the opportunity to grow”, the chief operating officer said.
Another area the council had intervened to boost the nations export is in the area of holding regular capacity building, sensitization, and enlightenment seminars for existing and aspiring exporters.
NEPC, in collaboration with international institutions, has organized several capacity building programs to empower producers by showing the benefits of formalized business practices. For example, its STDF Project 172 is a training program that focused on local Shea and sesame industries was undertaken in collaboration with the International Trade Center (ITC) and 13 other partners.
During the project over 600 women shea butter processors were trained on international best practices within the sector. Through improved SPS capacity building for private and public sector organizations and improved quality control along the supply chain of both products, participants have been able to improve and expand Nigeria’s exports of sesame seed and Shea nut/butter. Shortly after the completion of the program an American company placed an export order from Nigeria.

While the Nigerian Export Promotion Council had been able to record tremendous successes in its mission of enhancing Nigeria’s export, it also experienced a lot of challenges that undermined its sterling efforts. One of the challenges confronting NEPC, according to the council, is inadequate access to finance for exporters.
“Finance is an integral factor for exports and we are in active collaboration with other Nigerian institutions, such as NEXIM, the Nigerian Investment Promotion Commission (NIPC), and the Bank of Industry (BOI) to ease this challenge.
“Financial institutions can be somewhat hesitant to lend to potential non-oil exporters because of the perceived risks involved, and oftentimes, when lending is available, interest rates are high. This is something the council is aware of, and working on.
“Nigerian exporters require improved financial support, and we continually emphasize the importance of financial institutions support to our exporters. Under our new structure, the council has a unit dedicated to sourcing finance, and liaising with financial institutions to provide our SMEs with the adequate resources they need to grow and thrive. We also look for creative solutions to common funding bottlenecks so business owners are no longer forced to rely on personal and family funds to carry out their businesses”, he said.
He also identified some other major challenges faced by Nigerian entrepreneurs as infrastructural deficits such as power, water and poor roads. Others are weak logistics and support supply chain linkages as well as poor quality standardization of products (labeling and packaging).
“Quality control is an important area we must tackle in developing our non-oil exports. We lack an internationally recognized quality infrastructure framework that ensures the safety of our products; this is a major hindrance”, Awolowo said.
To address these challenges, NEPC regularly holds capacity building workshops and trainings, as well as collaborates with other government agencies both domestic and international.
NEPC is one of the government agencies actively participating with the EU and UNIDO on the National Quality Infrastructure Project (NQIP). NQIP aims to improve the quality, safety, integrity and marketability of Nigerian goods and services, especially those produced by SMEs.
Quality control capacity building programs are held throughout Nigeria, and SMEs are actively encouraged to participate.
NQIP has hosted Food Assessment Risk Trainings, Monitoring and Evaluation Workshops, Laboratory Trainings, Quality in industry and Trade workshops; as well as Quality and Standards system improvement trainings, specifically for exporters of several agricultural products including beans and melon seed.
Awolowo assured that NEPC under him will ensure that Nigeria always attains a balance of trade in its international trade, stressing that with the commitment by the agency for export promotion, the country will always be in a position to offset its import bills with proceeds from exports.

In recognition of its achievements, NEPC has won several awards both locally and internationally. One of the awards it received included the Certificate of Merit from the World Customs Organisation (WCO).
It also won the award for the ‘Best Initiative to Ensure That Trade is Inclusive and Sustainable’ given by the World Trade Promotion Organisations (WTPO) during the World Trade Promotion Organisations (WTPO) 2018 Awards presentation ceremony.
The WTPO Awards is open to all national trade promotion organizations (TPOs). It is designed to recognise and celebrate TPOs that excel in innovative and effective practices in export-development initiatives.