AGOA still not accessible, says NEPC

Source: The Nation Newspaper Published:Tuesday, January 26th, 2010

The Executive Director,/Chief Executive Officer, Nigeria Export Promotion Council, (NEPC), Mr. David Adulugba, has disclosed that Nigerian entrepreneurs are yet to fully maximise the benefits of the African Growth and Opportunities Act (AGOA).

Adulugba stated this during a media luncheon in Abuja, adding that the poor response of Nigerian entrepreneur, to AGOA is attributed to the non-competitive business environment they operate in.

He said: "As gloomy as the situation appears, we are optimistic that soon Nigerian entrepreneurs are taking advantage of the opportunities offered by the Act. In 2009 alone, 37 companies under the scheme exported $37,734,286,81 and 286,224,53pound worth of various products to the United States.

"This was about $48million less the amount that was realised in the corresponding year 2008 when a record of $86,502,236,36 was made. Our target for 2010 is to hit $10billion in the non-oil sector.

"The competition includes lack of functional infrastructure, high cost of banks loans and myriads taxes which have resulted in increasing cost of production.

"The profile of textile and apparel exports to the United States showed Nigeria only pegged as 25

th among the 41 countries of Africa, due to the fact that most textile factories in Nigeria have closed because of the high cost of production.

"Some of the challenges facing the development and promotion of locally made goods are high cost of production arising from inadequate infrastructure particularly as it relates to poor power generation, bad transport systems and inaccessible cum dilapidated roads.

"Added to this is poor packaging, lack of access to finance and poor quality of some of our products. Apart from this, allowing primary agricultural commodities to dominate our non-oil export sector has not paid off well for the economy, since the country is always ripped off good gains that could have been made from manufactured or semi-manufactured goods.

"Another major challenge is non-oil export trade in Nigeria today, is the difficulty in accessing funds by exporters for their international transaction.

Even though the current crisis in the banking industry have compounded the woes and expectation of exporters as most of the banks prefer to finance imports, rather than support export rather than support export initiatives."

Adulugba maintained that the high interest rate and other administrative charges make the cost of borrowing very prohibitive, thereby rendering production for export uncompetitive .

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