Charles Nwaoguji
Since his assumption of office, Nigeria’s president, Muhammadu Buhari, has never hidden his administration’s resolve to diversify the nation’s economy, away from oil as a major foreign exchange earner.
This resolve which has been the prayer of the generality of Nigerians has been emphasized in the president’s budget speeches, as well as in interactions with foreign investors and other important functions and meetings from time to time.
As a matter of fact, one policy of the Federal Government which remains a reference point in terms of export promotion, is the Export Expansion Grant (EEG). The Export Expansion Grant scheme is a very vital incentive required to stimulate export-oriented activities that will lead to significant growth of the non-oil export sector.
The EEG provides for claims payable to individual exporters depending on the value and volume of products exported ( as outlined in the EEG Policy Circular of Federal Ministry of Finance) and the individual rating as per the company baseline data ( also outlined in the EEG Policy Circular of the Federal Ministry of Finance).
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The company baseline data is based upon the audited financial results of the exporting companies and is based on the audited results of the company filed at the CAC ( Corporate Affairs Commission) and it verifiable by the NEPC before it even begin to process any EEG application.
This means that how much that is eventually paid out is based on the claims processed and approved by the EEG Implementation Committee meetings, a committee which draws membership from such agencies of the Federal Government as the Federal Ministry of Finance, Federal Ministry of Industry, Trade and Investment, the Central Bank of Nigeria, the Nigeria Customs Service, the Federal Inland Revenue Service, the Federal Ministry of Budget & Planning and the Nigeria Export Promotion Council.
There is no doubt therefore that the EEG is not only valuable, but follows a diligent process, with a mindset of accelerating export volume and enabling exporters to diversify their export products and market coverage.
However, the present situation surrounding the settlement of EEG obligations appears to be threatening its noble objectives.
Having made a lot of sacrifices and investments keying into the EEG initiative, non-oil exporters in the country appear being shortchanged for now. This is because they are currently owed outstanding payments running into several billions of naira in respect of the EEG.
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In fact, the Executive Director and Chief Executive Officer, Nigerian Export Promotion Council, Mr Segun Awolowo put it at over N1tn, saying that the payment is expected to commence as soon as the National Assembly reconvenes and gives its approval.
Awolowo who spoke on the sidelines of the Annual General Meeting of the Export Group of the Manufacturers Association of Nigeria (MAN), gave assurance that the government had processed the promissory notes and concluded plans to start payment but was waiting for final approval from the National Assembly.
“The government has done all that is necessary for the take-off of this programme. Right now, we are waiting for the National Assembly to reconvene and then they will grant approval for that promissory note programme.
“There are other debts that are coming under the promissory note programme. So hopefully, if the National Assembly reconvenes before the end of the year, everything will be implemented.” They hold the requisite promissory notes issued in lieu of the export values but have not been able to claim the monies due”, he said..
“We are really expectant on the National Assembly, because the monies involved is huge and the delay in payment is hamstringing Nigerian exporters”, said Mr. Jude Ajuonu, Executive Director of the Export Think Tank.
“if there are policies that should be expedited, it is ones tending on promoting the export sector. All over the world, countries are seeking to maximize the export market, and Nigerian should not lag behind”.
Also speaking along the same lane, Mrs. Mojisola Adenekan expressed optimism that the members of the assembly would do justice by promptly approving the payment as a way of triggering increased activity in the export sector.
“I personally believe that this government is committed to increasing the capacity of the country to export. The EEG is a veritable tool to achieving that, and it behoves on all concerned to see that the grant is promptly signed and disbursed.
In an opening remarks he had delivered at the forum indicated above, the Chairman, MAN Export Group, Chief Ede Dafinone, had passionately appreciated the Federal Government for reviving the EEG, especially with the expansion of the use of the Export Credit Certificate and transfer of the ECC.
“As a result of this expansion, our members will be able to transfer the ECC to a third party and use it to settle all Federal Government taxes as well as purchase of government bonds and settlement of credit facilities by development banks and liabilities of the Asset Management Company of Nigeria.”
Godwin Odhiare, general manager of Stagenta, a cashew processing company also said the Buhari administration needed commendation for initiatives targeting at boosting exports.
“But it does not just end at initiating. There is need to ensure that noble initiatives involving our export sector are implemented to the latter”.
He said there were many Nigerian firms desiring to explore the export market but who are discouraged by the heavy investments involved without quick response from eh government.
“IF I were an adviser of this government, it is one area I would advise them to address. You see, when investors get the required incentive, they do more. Many of us are proud to be business owners and employers of labour and to also create wealth for the country, but it would not be by losing whatever we have invested.
I think it is commendable that the government is lending full support to export trade. The national Assembly should do all in its power to back it”.
Other Experts are of the view that since the exporters have acted in good faith in relying on the extant government policy of EEG in making their investment and pricing decisions in their business, that they should not be made to regret it.
“They have taken on debts to service these receivables and these debts are incurring further interest with the continuing delay. This is pushing the exporters into greater financial distress with their banks and financiers.
The Senate /National Assembly should expeditiously clear the payment of Promissory Notes so that the non-oil exporters can get the much needed relief and succour and rededicate themselves to growing the export sector thereby contributing to the creation of jobs and livelihoods and growing the valuable foreign exchange reserves of Nigeria, they said.