By Daniel GUMM
MANUFACTURERS Association of Nigeria Export Group (MANEG) has said that the United Nations Conference on Trade and Development (UNCTAD) has warned that trade and investment flows with the South and reinforcing a long standing trend in which African countries export farm produce, minerals, ores and crude oil, and import manufactured goods, according to a new study by UNCTAD.

In a submission to the Nigerian Export Promotion Council (NEPC), MANEG noted that “the report says the situation should be reversed while South-South trend is still in its early stages. A repeat of the traditional pattern will not help African countries to reduce their traditional dependence on exports of commodities and low-valued-added goods.”

MANEG explained that besides, sub-Saharan countries suffer up to 40 per cent cost disadvantage before their products go out of their stores due to inefficiency of services and infrastructures.

It claimed that “the higher the Nigerian Local Content, the higher the cost of manufacturing, thus tire, textile, foundry industries and others that have no protection from smuggling or tariff are closing down.

“While cement, steel and other local content industries are sustained by high import tariffs. “Manufacturing companies that are surviving are mostly manufacturers that import up to 80 – 90 per cent of their raw materials.”

According to MANEG: “Some reasons that contribute to high cost of manufacturing are: irregular electric supply, high cost of generating own energy, labour when compared to Asian and other African countries, except South Africa, high banking interests, etc.

“Non-availability of sea transport in the Gulf of Guinea. Nigeria’s manufactured products are sold to the ECOWAS sub-region, in a formal or informal trade, as well as in Central Africa.

However, there is not a single Nigerian cargo sea vessel to transport ECOWAS products to other countries of the sub-region and as such the freight from Lagos to Monrovia is over and above that from Shanghai to Lagos (US$2500).

Our experience is that a shipment may take up to eight weeks and up to seven trans-shipments as confirmed by the Nigerian Shippers Council, while shipment to the countires of Central Africa is almost impossible.

High cost of road transport. Road transport per container is over $2500 from Lagos to Accra due to bad condition of the trucks, corruption in the borders and non-implementation of ECOWAS ISRTS.
Very high cost of port charges. Nigerian port charges are over four times higher than any port in Africa.