The UK Government announced it has reduced tariffs on duty-free trade in goods exported from Nigeria.
This was disclosed by Mr Ben Llewellyn-Jones, Deputy British High Commissioner to Nigeria at the launch of the Developing Countries Trading Scheme (DCTS) in Lagos.
He stated the move which will take effect from April 2023 will boost Nigeria’s non-oil export trade as trade volume between UK and Nigeria hits 2.2 billion pounds in 2022.
Import costs: Llewellyn-Jones revealed the move to cut tariffs from Nigerian exports will reduce import costs to the sum of £750 million per year for the British consumer, he added:
- “ The UK Government has reduced the tariffs of 90 per cent of goods that Nigeria would export to our country and has also provided a preferential trading scheme for a range of other exports that the country might have.
- “ We have reached out to small and large businesses in different parts of the country and this is intended to help exporters and other people in the trading business to make the United Kingdom an export destination.
Non-oil exports: The UK envoy added that it will also enable the growth of non-oil export-based jobs in Nigeria and create jobs in Nigeria.
- “This would also serve as an opportunity to grow the non-oil and gas sector in Nigeria and create jobs in the country, and most importantly, we are reaching out to people at the grassroots level so they can know what we are doing.
- “The DCTS is much more generous and simpler than the existing Generalised Scheme of Preferences (GSP).”
Trade volume: Llewellyn-Jones added that trade volume between both nations was 2.2 billion pounds for the year 2022, citing that the oil and gas sector still makes up a bulk of trade activity, adding:
- “We have to change focus to the non-oil sector but this takes time, but we are working with experts from Nigeria Export Promotion Council and the Federal Government to grow the economy through expanding of its export.
- “The key challenges for exporters are finding key partners in the UK to sell their products but we are working on ensuring that we link exporters with potential buyers so as to ensure there is enough demand and supply.”
Mr Simon Calvert, Senior Commercial Agriculture Adviser, Foreign Commonwealth and Development Office (FCDO) added Nigeria does not require international conventions to enjoy the benefits of the Developing Countries Trading Scheme.
He also noted that cutting tariffs for Nigeria would ensure that 3000 new products are duty-free for the first time as the average existing tariff on these goods is seven per cent, meaning these changes make Nigerian exports more competitive in the UK.
- “ Many tariff reductions are on value-added goods such as processed sesame oil, cotton clothing and cocoa butter and paste and complement existing duty-free trade on raw products.
- “ We have made it simpler for Nigeria to get and retain these enhanced tariffs by removing the need for Nigeria to ratify and implement certain international conventions.”
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The Nigerian Export Promotion Council (NEPC) revealed that Non-oil-based exports in Nigeria grew by 39.91% in 2022 to $4.820 billion. Semi-processed/manufactured products made up 36.61% of the exports beating Agriculture’s 30.12% volume of non-oil exports.
NEPC added Nigeria’s Non-oil exports record for 2022 reached its highest since the establishment of NEPC 47 years ago, acknowledging export intervention programmes by the NEPC over the years, they said:
- “About 214 different products ranging from manufactured, semi-processed, solid minerals to raw agricultural products were exported in 2022.
- “Of these products exported, Urea/Fertiliser topped the list with 32.87 per cent.
- “The emergence of Urea/Fertiliser as the highest exported product in 2022 can be attributed to the Russia-Ukraine war which created an avenue for Nigeria’s Urea/Fertilizer to thrive.
- “It is worthy to note that our products were exported to 122 countries with Brazil recording the highest import value of 12.27 per cent.”
Now the Nigerian government should reciprocate by working with OPS and LCCI to ensure we derive maximum benefits. The business environment is too toxic. Funding for start ups is very difficult while existing businesses access funds at high interest Cost. There are myriads of issues why we are not doing well economically. It takes a serious business minded government to resolve these issues holistically and start getting results say in 9 months. At this rate, even if the British government reduce the tarrif to zero, it is meaningless.