Nigeria’s 13% Africa Export Trade Share That Buhari Is Kicking In The Teeth, And Dangote Is Agitated

The Oasis Reporters

November 6, 2019

On October 29, 2019, The Oasis Reporters published a scholarly article by Tahiru Azaaviele Liedong, Assistant Professor of Strategy, University of Bath titled ‘Nigeria’s border closure has implications for Africa’s economic integration’.
One revelation out of it is the size of exports to African countries by Nigeria which was put at 13%.

It seemed negligible to Nigeria’s president, Muhammadu Buhari who has scoffed at it and promptly shut the country’s borders with neighboring countries. But that figure means the world to neighboring countries in the ECOWAS sub region, and also Nigeria’s growing legion of international business persons.

It flew in the face of free trade protocols signed, when “Nigeria recently partially closed its border with Benin in an effort to stem the smuggling of rice. It then went on to close its land borders to the movement of all goods from Benin, Niger and Cameroon, effectively banning trade flows with its neighbours”, writes Tahiru Azaaviele Liedong.

The author also states that Nigeria’s actions raises important concerns about the seriousness and prospects of regional integration in Africa as it acted just three months after it had signed the African Continental Free Trade Agreement.

All the countries in the West African sub region are decidedly unhappy about Nigeria’s unilateral action, but seem impotent in confronting the challenge. Still there’s something that they can do.

Suddenly, Ghanaian shopkeepers woke up one morning and ordered Nigerian shops to remain shut. It was a reaction.

Former President Olusegun Obasanjo’s home area is Ibese in Ogun State, just 28 km to The Republic of Benin.

In February 2012, Aliko Dangote opened his Cement Factory to serve the key Lagos and South West markets. And ostensibly, the market in the French speaking country of Benin Republic. Dangote took advantage of the 150 million tonnes of limestone, enough for about 78 years at Ibese, producing 12.0mt and is supported by 1,488 cement delivery trucks. Now, an angry President
Patrice Guillaume Athanase Talon of Benin has reacted. He would rather his country import cement from China than buy from Dangote, just 28 km away.
Political reaction.

To power the plant, Dangote invested in a 3 x 37 MW Captive Power Plant. And the continent’s biggest billionaire according to Forbes Magazine says that at zero production level, he is at par with Chinese producers.

Why would President Talon snub Dangote ?
Anger against Buhari’s action.

Tahiru Azaaviele Liedong concludes his article by examining Nigeria’s case that “Africa accounts for only 13% of its exports and 4% of its imports. These statistics probably underestimate the true volume of trade between Nigeria and its neighbours. But they show that Africa is a dispensable market.

The recent oil crisis highlighted the need for the country to diversify and restructure its economy. The result was increased attention being accorded the agriculture sector, which had declined significantly since the late 1960s.

Nigeria’s 2017 Economic Recovery and Growth Plan aimed to deepen investments in agriculture and increase the sector’s contribution to economic growth from 5% in 2017 to 8.4% by 2020. The idea is to revive domestic farming and save on food imports (over $22 billion a year).

It is this national plan that precipitated the border closure. The government wants to protect domestic farmers from cheap imported foodstuff.

While Nigerian rice farmers are happy about their government’s actions, there are concerns about whether domestic food production can meet domestic demand. In 2017, demand for rice in Nigeria reached 6.7 million tons, almost double the 3.7 million tons produced domestically.

Since the border closure, the price of a 50 kilogram bag of rice has increased from 9,000 naira ($24) to 22,000 naira ($61).

This is good for the farmers. But it is hurting consumers”.

The biggest concern revolves around protecting home based farmers, who even in the face of rolling acres of immeasurable farmlands, fail to produce enough.
What is the cause ?
Such factors have not been addressed and yet a spiteful ban has been imposed making the rice grown at home several times more expensive than the one coming from another continent far away.
Something is definitely wrong, meanwhile, the people go hungry whereas Aliko Dangote says Nigerians prefer to consume rice three times a day because it is their staple.

Greg Abolo

Credits:

Resource article from Tahiru Azaaviele Liedong

Aliko Dangote

Mo Ibrahim

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Greg Abolo

Blogger at The Oasis Reporters.

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