…Say non-oil sector strategic for economy diversification, support 10m persons
…Experts advise EDF administration should be transparent
Ben Eguzozie, in Port Harcourt
The Umuahia Chamber of Commerce, Industries, Mines and Agriculture (UCCIMA) along with South East Chamber of Commerce, Industry, Mines and Agriculture (SECCIMA) and the Nigerian Export Promotion Council (NEPC) have asked small and medium-scale enterprises (SMEs) in the South-East region to work assiduously to access the N50 billion export development fund (EDF).
The aim is to get the SMEs who are mainly in the non-oil sector to become versed with international export trade dynamics.
Chidi Aruoma, president of UCCIMA said in Umuahia that the EDF as a grant would cover the initial expenses with respect to export promotion activities.
“The EDF is a pure grant that would financially assist SMEs with access to the international market, make for research and development, consultancy on product design and packaging, as well as business development services such as: production of bankable business plans and feasibility studies,” he said.
Aruoma implied that individuals, group of persons and co-operative societies are encouraged to take advantage of the EDFS grant in order to launch themselves into the non-oil sector of the Nigerian economy.
He said the federal government has earmarked N50 billion for the EDF as free pre-shipment incentive or grant to financially assist Small and Medium Enterprises (SMEs).
He enjoined all SMEs and entrepreneurs – especially in the South-East region – to avail themselves of the opportunity to access the fund in order to grow their businesses.
Experts say the non-oil export sector is strategic for the diversification of Nigeria’s economy and can support the livelihoods of over 10 million persons. The country’s exporters suffered greatly amid the Covid-19 pandemic.
As a result, export experts are calling on the Nigerian federal government to utilize the Export Development Fund to provide relief to exporters directly and rapidly; saying this will be a key success factor to promote country’s non-oil exports.
But these exporters have equally called for adoption of transparency in administering the EDFS for greater impact and transparency just like other developing countries that have implemented several measures to help their exporters to mitigate the Covid-19 adverse impact.
The EDF scheme was set up by the Nigerian federal government under the Export (Incentives and Miscellaneous provisions) Act CAP E19 Laws of the Federation, 2004, with the objective of providing financial assistance to exporting companies to cover part of their initial expenses with respect to export promotion activities.
With the knock-on effects of Covid-19 pandemic on the global trade, national governments have been embarking stimulus advances to rejig their trade. According to the WTO, global merchandise trade in 2020 declined by 9.2 per cent; with a projection to rebound with a 7.2 per cent growth in 2021.
For Nigeria, with its high commodity-dependent economy, its exports of oil and non-oil have suffered a deadly blow, due mainly to a dramatic fall in the international demand for crude oil, with disruption of trade logistics. The Nigerian Bureau of Statistics (NBS) said, Nigeria’s total merchandise exports declined by 52 per cent and 44 per cent in quarter two and quarter three of 2020 (Q2 2020 and Q3 2020) respectively over the corresponding period in 2019.
However, exports of agricultural goods jumped the trend, and recorded growth of 6 per cent and 44 per cent year-on-year.
As national governments all over the world came up with relief measures to cushion the effects on their vulnerable sectors at macro and micro levels, and to support industries and firms, exporters welcomed Nigeria’s augmented export development fund scheme (EDFS) under the FGN National Economic Sustainability Plan (NESP).