To exchange

Chinedu Eze writes that despite its enormous potential to become a major source of foreign exchange for Nigeria, which could exceed oil revenues, the country has failed to export its goods and services which have been in high demand in the country. foreigner. At a recent freight conference held in Lagos, experts identified the obstacles to exporting local products and the invaluable economic gains that could be achieved if the right actions and decisions were taken.

With over 15 million Nigerians living abroad nostalgic for products made in Nigeria and others yearning to have organic agricultural products from Africa, the country could have made billions of dollars from perishables if the good environment had been created for export.

Much of the Nigerian administrative system at airports is cluttered with slow bureaucratic bottlenecks, selfish staff in government agencies, and policies that are not ready to spur economic growth.

On the other hand, the situation where perishable and manufactured goods are produced in Nigeria is still below the norm, these goods can be accepted in various countries where the demand for products made in Nigeria is high.

These points and many more were the main points raised at the recent Aviation and Cargo Conference held in Lagos on August 25-26, 2021, during which aviation experts, operators freight, insurance experts and handling companies have been thinking about how to maximize the benefits of exporting. of products made in Nigeria.

Export process

The CEO of ABX World, a freight airline, Captain John Okakpu in his presentation said that one of the main failures of the export process in Nigeria is the inability to match exports to markets, especially in the areas of documentation and certification requirements. He said Nigerian exporters continue to rely on the country’s bogus documentation and certification standards, most of which are not recognized anywhere in the world.

“The first step to engaging in exporting is to identify, properly analyze and comply with the requirements of the proposed importing countries. Thus, the exporter must provide the necessary products, their satisfaction and the documentation. Then a transparent export can be performed.

“Economic experts have recognized many on the brink of economic collapse due to the serial failures of government agencies that have been mandated and economically empowered to drive the process,” said Captain Okakpu.

He observed that due to the continued decline in revenues from crude oil sales and the inability to increase Nigeria’s export business, especially agro-export business, the country’s currency “ continually degenerates into devaluation ”.

On the other hand, he noted that Nigeria, by properly meeting the demands of the export market, has the innate capacity to rake in $ 250 billion per year just on agro-export products.

He said the only way to resolve this anomaly is to strictly adhere to the requirements of primary export markets, which is to provide the following: GAP certificate for agricultural products to be exported; Phytosanitary / veterinary certificates and personalized certification.

Obstacles

“The main obstacle preventing Nigerian exporters from having a seamless export experience is: GAP (Good Agricultural Practices) certifications and our exit points cluttered with multiple / multiplication of agencies and too many MDAs (relevant and not relevant) positioning itself to stimulate agro-export! The Agro-Export program is 100% led by the private sector and will remain so forever. For nearly five decades Nigeria has had about five different policies on the agro program. Each of them died immediately after the end of this regime. So. what does this tell you, the private sector is the answer and the public sector is the catalyst.

“Another essential element and one of the most important aspects of our agro-export problems are the government fees and taxes which are about 90% higher than our closest competitor. So, in most cases, it is cheaper for most cargo planes to leave Nigeria empty than to carry cargo.

Okakpu said it is known that exchange rates are increasing daily and all aircraft spare parts are imported and most of their maintenance checks are done overseas. This, he said, weighs on the revenues of airline operators. This situation, he noted, is exacerbated by the Covid-19 pandemic, which has made airline revenue generation so meager that most of them are barely surviving now.

“We import almost everything for flight operations, including fuel. Then we are now looking at high government fees / taxes and we expect our agricultural products to be competitive in the world market which is not possible.

“For example, 2kg of pineapple from Costa Rica about a 12 hour flight to London costs £ 0.95 to £ 1.10 in most supermarkets. 2 kg of pineapple from Nigeria about six hours flight time to the same London, logistics cost, I mean logistics cost alone is around £ 1.75 without production. Now tell me how are we going to compete?

“In addition, almost all of our farmers are not GAP certified nor do they understand what it is. Instead of the government wasting its resources on businesses that would not yield any results in agro-export activities, the government should invest in sponsoring the GAP certifications of our known top farmers who will eventually form the core of GAP certified farmers. who will be able to set our GAP standards as in the case of many advanced countries, Ghana, Kenya and others, ”he said.

Advantages

Okakpu said this process would have multiplier effects on farmers’ ability to have assured buyers, rapid repayment of loans taken out, increased crop yield per hectare, increased profitability and little to no post-harvest losses.

“It should be noted, however, that some people mistakenly believe that proper packaging or a trade and bilateral agreement between two countries guarantees the free flow of agricultural products. Yes, such agreements open the doors of free trade between countries for mutual benefit. But there is a caveat here that ensures that advanced countries will only accept agricultural products traceable with internationally recognized Good Agricultural Practices (GAP) certifications / traceability. A responsible country would not allow, because of trade deals or beautiful packaging, to let poison or substandard products into its country to kill its citizens, ”he said.

The right facilities

Mainstream Cargo Limited CEO Seyi Adewale, who looked at the growth of the air cargo value chain in Nigeria, stressed the need to provide the right facilities to improve cargo export in the country.

Adewale said that with airports being a critical need for the movement of air cargo, connecting the dots to move mainly agricultural products is a real need. He said that many agricultural products or agricultural products are moved by road transport, especially from the northern / middle region of Nigeria to its southern region, while finished or manufactured goods, equipment and material resources move in the region. north and middle direction.

“It is therefore necessary to encourage and support these state governments to build this infrastructure to develop the economy of the affected state, generate IGR, create jobs, noting that supply creates demand.

“To meet the needs of domestic airports, we need good and efficient cargo warehouses in and around these airports. We can explore the current opportunity within the airport itself using Lagos domestic airports as an example. Does MMA2 or GAT (General Aviation Terminal) have good / large storage, sterile or temperature controlled warehouses to hold perishables, pharmaceuticals etc.

“Secondly, as an indication, the impending Lagos airport around the Ibéju / Lagos State Free Zone axis should plan the construction of a good freight warehouse with modular temperature-controlled storage assets. to support the investments of companies / entrepreneurs who have invested in an excellent storage center and warehouses along the Lekki-Epe axis, the free trade area axis and the highway axis Lagos-Ibadan, ”he said.

Adewale regretted that Nigeria does not have dedicated air cargo airlines operating at domestic airports to date, noting that Allied Air appears to be the only cargo airline trying to fill this gap.

He observed that when air cargo transportation opportunities arise, freight forwarders, companies look for air charter (freight), but the process of doing so makes it inefficient. In other words, the businessman is faced with such cumbersome, expensive and frustrating processes that he might be discouraged from going into the business.

National freight airlines

“If we have at least two approved / licensed air cargo airlines operating on the domestic side, hopefully they will be busy all year round and this could be incorporated into Africa’s regional air cargo flight from there. ‘Where is. We need to highlight and highlight these needs to aviation investors. What is preventing even one of the handling companies in Nigeria from procuring planes for this purpose and thus providing this domestic air cargo service? It will even greatly benefit their quest to take advantage of tax, exchange and other incentives enjoyed by airlines (especially international) because they could integrate their handling services into them. I understand that they explored this opportunity from a free trade zone, but they encountered obstacles and legal challenges which limited these expectations of benefiting from such a free zone license, ”he said. -he declares.

Thus, the stimulation of exports depends on two major factors, the revision of government policies to facilitate the process of exporting by air freight and improving the quality of agricultural products, and obtaining the appropriate certifications. When these are completed, Nigeria would be able to draw the planned $ 250 billion from exports.

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