Nigeria’s services sector has emerged as the highest contributor to the national output in the last decade and offers great potential to drive the diversification agenda of the government which has predominantly concentrated on agriculture and manufacturing. Services now contribute the highest proportion of the overall domestic activities and economic growth moving from less than 30 percent of gross domestic product (GDP) in the 1990s to 50.79 percent of the GDP in 2010 and 53 percent in 2019. Nigerian services economy is among the fastest growing in the African continent, recording double-digit growth rates between 2009 and 2012.
This Roundtable, put together by the PDF Bridge Programme, featured representatives from the Network of Practicing Non-Oil Exporters of Nigeria (NPNEN), the Nigerian Export Promotion Council (NEPC), private sector companies, and individuals interested in export to discuss the findings from the Services Export study and the best approach to utilize the output from the study to support diversification efforts of the Government of Nigeria (GoN).
Panellists include Mr. Francis Anatogu, Executive Secretary, National Action Committee on AfCFTA and Senior Special Assistant to the President on Public Matters; Barrister Nkiru Joy, President/ National Coordinator at Nigerian Network of Women Exporters of Services; Dr. Madu Obiora, President, Association of Outsourcing Professionals of Nigeria (AOPN); Barrister Legborsi Nwiabu, Trade Lawyer and Private Sector Specialist, Executive Director Nigeria Private Sector Alliance (NiPSA) and Mr. Abubakar .G. Shu’aibu, Assistant Director, Services, Nigerian Export Promotion Council (NEPC).
At the Roundtable, it was noted that among business owners and exporters, there is little understanding of what services export entails. Many businesses engage in service exports but are not aware of this. Understanding the four modes of services – Cross border trade, Consumption abroad, Commercial presence and Presence of natural persons – is important for business growth. To achieve this, stakeholders including the NEPC will need to conduct capacity building and sensitisation workshops for exporters, working with relevant business associations.
There was an extensive discussion on the available incentives for non-oil exports in Nigeria. Among the list of incentives introduced in the 1980s to support non-oil exports, only the Export Expansion Grant (EEG), which focuses on goods exports, is functional. The Roundtable however noted that existing incentives for goods exports are not adequate, while there is currently no incentive for services exports. The government was urged to prioritise the development of non-oil exports, going forward.
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The Policy Development Facility Bridge program (PDF Bridge) held a Trade Policy Roundtable to discuss the findings and recommendations from its recent study titled “Diversification and Non-oil Export Opportunities for Nigerian States Post-Covid19”.
The objectives of the policy roundtable were;
- To provide a forum for relevant stakeholders to learn about and discuss the findings from the Export Diversification study;
- Through discussions, generate recommendations on necessary actionable steps towards reforms, process restructuring, elimination of various challenges identified in the study, and implementation of the study recommendations.
This study conducted by PDF with support from FCDO (formerly DFID) shows that women who engaged in cross border trade contribute to food security by trading food products from areas of surplus to areas of deficit. The paper reveals that depending on how this trade is organized, these women have the potential to contribute significantly to household earnings and resources. This empowers women by giving them financial independence and control of their own resources.
PDF II held a two-day capacity building training themed: “Capacity Building for Banks and DFIs”. This is designed to explore access to finance challenges, awareness campaigns, and opportunities that non-oil exporters face with banks in accessing finance. The capacity building covered topics such as Export Industry Regulations and Documentations, payment methods and trade finance instruments, Handling export finance options, managing export risks, understanding the franchising potential etc.
Aba Industrial City is an aggregation of thousands of MSMEs and mass producers of industrial goods including garment and leather products. If properly harnessed, the mass production capacities of component clusters of AIC and similar models are capable of positioning Nigeria at a competitive advantage in the global garment and leather industrial space. In 2016, the Textile, Apparel, and Footwear sector contributed N2 trillion ($6.6 billion), approximately 2% of Nigeria’s total GDP, to Nigeria’s economy.
Africa’s contribution to global trade in services is little with slow growth despite rapid globalisation and liberalisation. The continent’s intra – African trade in services is also relatively little. Nigeria’s services sector contribution to its GDP is huge, representing 55.8 per cent in 2017. It recorded a growth rate of 1.83percent in 2018. Hence, the services sector possesses the immense potential to promote diversification, employment, and growth, even without a current holistic services sector policy. This study specifically mapped and profiled key services sectors; reviewed domestic regulations relating to services; estimated the current and future potentials for export, and provided associated recommendations.
