China-Africa tariff exemptions: Why is Nigeria excluded?

Guardian Nigeria

Watch China-Africa tariff exemptions: Why is Nigeria excluded? - Guardian Nigeria on Dailymotion

Transcript

00:00Nigeria is urging China to remove trade tariff in extension to the gesture given to 33 other

00:05African countries, stating that the move will deepen economic cooperation and boost trade

00:09in areas critical to Nigeria's development goals.

00:12Meanwhile, Nigeria and China recently signed a 7.6 billion euro green hydrogen energy deal,

00:17a gradual transition from fossil fuels to clean energy.

00:20Obie Ramadu, the Director-General of the Africa Centre for Supply Chain, joins me now for

00:24this conversation.

00:25Thank you so much for your time today, Mr. Ramadu, and interesting news we're seeing

00:29playing out from China here.

00:31We've seen the exemptions given to these other African countries, but why is Nigeria excluded,

00:36you would say?

00:38Thank you very much.

00:39I think I wouldn't say that that determines how important we are to China, but the fact

00:46is that it is he who asks that receives.

00:52So now that we have seen it extended to 33 countries, we're asking, and hopefully we

01:00shall receive, but that will be a function of a whole lot of things.

01:03Yeah, but how significant do you think this will be for the countries that are already

01:07receiving these tariff exemptions?

01:10Well, generally, once you have a duty-free access into a market, the tendency, if you

01:19are strong in export, because it is subject to that, if you are strong in export, obviously

01:25your export will be expanded with other multiplier effects, creation of jobs, probably bringing

01:32up SMEs.

01:35So definitely these are the kind of benefits, and probably more, because the point is that

01:40if you get into that kind of bilateral trade agreement and you are able to do a thorough

01:45analysis of where your strength lies, you will get more benefit.

01:52And the dangers are China, well, maybe for those 33 countries, they are not asking for

01:58equality, duty-free on both sides.

02:06That's an issue that could arise.

02:09My point is that a very good thing we're asking for, and we're likely going to get it because

02:16we've had a very good relationship with China, but the question will be, are we ready to

02:21exploit the advantages?

02:22Yeah, but critics will say that when you look at the goods under the exemptions here, it's

02:29still low-value raw materials that are still being considered here, and more or less, how

02:34then do we improve the conversation to issues like value capture and exporting more processed

02:41goods into China?

02:43We've cried about this for a very, very long time, that when you export commodities, you

02:47export jobs and other things.

02:50And here, in this arrangement that we're asking for, we're looking at agriculture, we're looking

02:56at solid minerals.

02:58Of course, we're not looking at oil, even though the oil trade will continue to grow.

03:03So I agree with you that value addition should be the name of the game.

03:08Are we ready for value addition?

03:11Are we ready for value addition?

03:12Because if you talk to those who are into manufacturing, production, no matter how small

03:18your production facility is, it's a hell because of infrastructure, which includes electricity

03:24and the rest of them.

03:25So we are not competitive.

03:28We're not competitive.

03:30That is the biggest challenge that we have.

03:31So we will need to deal with all those things, even if we get this very particular duty-free

03:38access to Chinese market, which we're asking for.

03:40I can tell you that it will take a while.

03:44An example is that AGOA has been there for about 25 years.

03:48What did we do out of it?

03:49So it's not about getting the bilateral trade agreement where you have duty-access-free,

03:55but the action behind that.

03:58You have to work on it from your side.

04:00Be prepared.

04:01Actually, you hit the nail on the head when talking about export competitiveness here.

04:04And I'm thinking, looking at the strides that we claim to have made in terms of competitiveness

04:09in Nigeria, why is it so difficult for us to compete?

04:13Yes, we know the perennial issues, electricity is still a big key challenge here.

04:18Many barriers still are in there.

04:20But I'd like you to speak to that, how to improve Nigeria's export competitiveness.

04:23It's a complex challenge.

04:26My doctorate thesis was based on the dynamics of logistics infrastructure and Nigeria's

04:32export competitiveness.

04:34So during that study, I found out quite a lot.

04:39These things you know is not rocket science, but the fact is that, I don't know, we want

04:44to take a giant leap instead of making small incremental movement towards that.

04:52Nigerian commodities in Nigeria here, their prices are higher than the international market

04:55price.

04:56The logistics component cost of doing exports is the highest, probably the highest in Africa.

05:07So the point is that we need to do something about infrastructure within.

05:14We also need to do something about infrastructure in the port.

05:18If you look at our position in logistics performance index, you know that it's not too good at

05:23110 to 136, and then failing in almost all the components of logistics, easy access and

05:33the rest of them.

05:34So it is something that we must be intentional about and deliberately start with infrastructures

05:41that will give a direct impact on the issues at hand.

05:46That's the way to go about it.

05:48It's not something that can happen overnight.

05:50If we are deliberate and then we are also measuring, then we can gradually get to where we're going.

05:57Alright, so definitely being deliberate and intentional about the wins we want to get

06:02out of the entire ecosystem will help there.

06:05But I'd like you to speak to the 7.6 billion euro clean energy deal, you know, and what

06:10that means in terms of Nigeria-China partnership.

06:13We've seen that that partnership, the trade volume is about 20 billion already, crossing

06:16that mark.

06:17What could this mean for Nigeria-China?

06:20Well I think that will bring about some direct foreign investments into Nigeria.

06:30At times I get confused actually, when we are selling fossil fuels and then we are also

06:37talking so much.

06:38But of course we have to move with the world.

06:41That is a big leap in the trade relationship between Nigeria and China.

06:47And probably more of it will happen when we negotiate this bilateral, this duty free access.

06:54But what does that mean for our main area of dependence at this moment?

07:03That is the question.

07:04Is it beneficial?

07:05Fantastic.

07:06But the fact is that, how does it affect the area where our emphasis, where our economy

07:13is practically dependent on?

07:16Those who are in the administration will have to answer that question.

07:19Finally, I'd like to bring in geopolitics into this here, because when you look at the

07:22world and how the world is evolving, you know, choosing a strategic partner or even how you

07:26partner across the nations is quite important.

07:28And I'd like you to speak to the nature of trade we're seeing between Nigeria and China

07:32on one hand, and how that differs from what we see play out with the US.

07:37I think, if you ask me, I think...

07:40Especially with the Trump phenomenon coming on.

07:43If you ask me, I think that we have a more friendly trade relationship with China, obviously,

07:50given a lot of what is going on.

07:52We are aware that recently we had the first direct shipment from China that came into Nigeria.

08:00But the question is, I hope the vessels didn't leave empty, because that's what bilateral

08:05trade is all about.

08:07So if it left empty, then there's a problem.

08:10Then looking at it from the American point of view, Trump has always been anti-Africa,

08:18so to say.

08:19And I think the first victim is likely going to be AGOA, which expires in September this year.

08:27So I think, of course, it is part of what we're asking China to do for us, is the part

08:34of it is a fear of what is likely going to happen with AGOA.

08:39But the question is, even while AGOA lasts, to what extent did we take advantage of it?

08:44That's the question.

08:45All right.

08:46Obi Aramadi, they're posing many questions here on trade.

08:49I've been speaking to the Director General of the African Center for Supply Chain.

Category

Transcript

Recommended