FG to review export expansion grant

The Federal Government has announced its plan to commence the review of Export Expansion Grant (EEG) next January. The decision, which was disclosed in a cashew export promotion meeting in Lagos last week, was coming after a comprehensive review of the scheme in order to block loopholes in the initiative and eliminate its inadequacies.

Speaking at the event, Mr. Segun Awolowo, the Executive Director of Nigerian Export Promotion Council (NEPC), explained that the review of the scheme became expedient following the challenges encountered by stakeholders in the non-oil export sector and to cater for the present realities in the nation’s manufacturing sector as it takes off in January 2015.

He added that the challenges of issuing an EEG certificate has been resolved, as it would be issued out soon to beneficiary.

He stated: “We work on holistic reserve of the scheme which we reintroduced to stakeholders and the days of operations of the reviewed EEG will manifest the intended development in the sector.”

Also, the NEPC boss added that the existing certificates would be honoured, as the Coordinating Minister of the Economy, Dr. (Mrs.) Ngozi Okonjo-Iweala, has agreed on that. He stated that he would find out when it is going to be honoured as he lamented that it is hampering operations of manufacturers in the country.

He explained that the issue of branding is among the things that affect Nigeria’s export activities, while the council has put measures in place to address issues like training of stakeholders,  brand building, brand marketing.

“It is very important about training, about developing the farmers. Because when your product is good, the next issue is how to sell it, how to market it and you need to create brands. We need to solve it because it was a problem in NEPC and it was our basic strategic keys; we said look, the way forward is that farmers must develop brands. We really must have a marketable brand,” he submitted.

Commenting on cashew particularly, he said that in 2013, cashew exports generated N17.7 billion ($110 million), which represents about 10 per cent of agricultural exports. However, if they compare this figure with India’s export of over $2.5 billion and Vietnam’s export of $3 billion mainly from processed kernel, annually, it means Nigeria definitely needs a well-articulated strategy to grow the cashew sector.

“In recognition of the potentials for job creation and generation of foreign exchange estimated at N2 billion from the cashew sector, the council had set up a mini-processing factory at Obollo-Afor in Udenu Local Government Area, Eungu State.

“The main objective of the projects is to harness the abundant raw materials (RCN) and tap the skills of women in cashew processing. The pilot scheme, which had success could be replicated by potential investors in other cashew producing states. Some investors have approached the council for possible collaboration in investing in cashew processing,” he added.

He noted that a recent study by USAID, an increase of 20 per cent from Nigeria’s current products figure would create more than 344,000 new jobs and $75,875,000 additional incomes. According to him, the stakeholders are fashioning out the cashew sector strategy that would assist the council to develop a new implementation strategy that would grow the sector in line with the Transformation Agenda of the government.

He further said the council partnered with USAID/NETT on untiring efforts to develop the sector in particular and the economy through its flagship Lakaji Corridor Project.

EEG is an initiative first introduced by the former President Olusegun Obasanjo administration to help Nigerian manufacturers deal with the inherent disadvantages of the harsh operating environment induced by the poor state of power and other infrastructure in the country.

It was intended to help manufacturers deal with high production cost, which prevented them from accessing and competing effectively in the export market.