NIGERIA:AGOA SUCCESS STORIES AND REMAINING CHALLENGES

UNCLAS SECTION 01 OF 02 ABUJA 000451 SIPDIS SIPDIS DEPARTMENT FOR AF/W (SILSKI) AND AF/EPS (POTASH) DEPARTMENT PASS TO USTR (AGAMA) ACCRA PLEASE PASS TO WEST AFRICA TRADE HUB E.O. 12598: N/A TAGS: ETRD AGOA ECON EAIDNI SUBJECT: NIGERIA:AGOA SUCCESS STORIES AND REMAINING CHALLENGES ABUJA 00000451 001.2 OF 002 ¶1. Summary. The Nigerian government (GON) has made strides towards using AGOA to diversify its exports and move away from relying on oil production. AGOA incentives are yielding some positive results. Category 9 Certification of folkloric and hand loomed textiles and the recent Turtle Excluder Devices (TEDs) certification have provided opportunities for Nigerian exporters. GON officials and exporters, however, complain that two major challenges to exporting to the U.S. are the general negative perception of the GON and its citizens; and the very high and stringent minimum quality standards requirement for goods entering the U.S. market. End Summary. . Recent Developments and Success Stories -------------- . ¶2. On February 28, EconOff met with David Ashiru, Advisor to the CEO of the Nigerian Export Promotion Council (NEPC),and Opeyemi Abebe, Head of the AGOA desk at the NEPC. Both officials confirmed that the Category 9 certification for special forms of textiles recently granted to Nigeria had resulted in the export of children's clothing made of combined African prints to the U.S. Both Ashiru and Abebe said that though the first sets of shipments were exploratory, the exporters confirmed that they have received positive responses and orders from U.S. buyers. ¶3. Both officials reported that a shrimp exporter recently took advantage of the TEDs certification to export shrimps to the U.S. The shrimp exporter told the officials that he sold shrimps to buyers in the U.S and it was likely that his company would receive more orders from the U.S. ¶4. Ashiru and Abebe said that a Human Capital Development Center had been established in Lagos to train producers and exporters. The center currently focused on commercial apparel producers, and eighty students recently completed training in the center. ¶5. Ashiru commended the USG for co-sponsoring a U.S. Customs seminar in Abuja for Nigerian customs officials, led by Brian Fennessy of U.S. Customs and Border Protection, in conjunction with the West African Trade Hub (WATH) on November 29, 2006. He said that it was a step in the right direction because such training would eventually improve the skills of customs officers and make them realize the essence of attending to exporters needs in a timely manner. He welcomed future collaboration with WATH. . Outreach Efforts -------------- . ¶6. Various seminars and trade missions were held in 2006, reported Abebe, including seminars on shea butter, cashew, handcrafts and product packaging. The seminars were all geared towards improving Nigerian exports to the U.S. There were four trade missions to the U.S. during the year, three in collaboration with WATH. . Remaining Challenges and Increased Efforts -------------- . ¶7. Ashiru and Abebe commented that the greatest challenge to expanding the benefits of AGOA for Nigeria was the overwhelming negative perception of Nigeria and its citizens regarding advance fee fraud and corruption among U.S. importers. They agreed that it would take some time to surmount such a perception problem but hoped the GON's ongoing anti-corruption and anti-money laundering campaign would change attitudes of importers. ¶8. Another challenge to increasing AGOA exports were the high quality standards required for products exported into the U.S. and the dearth of skilled Nigerian customs officers. The recent customs training and the Human Capital Development Center in Lagos were positive steps taken by the GON to overcome this problem. . Comment -------------- . ¶9. Nigeria's efforts to diversify its exports from oil to non-oil products is a step in the right direction and fits with USG objectives for AGOA. A major hurdle to accelerating Nigerian benefits under AGOA is the high cost of doing business in Nigeria. Infrastructure - roads, electricity, water, railways - are all in horrible condition, while endless delays continue to clear goods at the ports. In addition, the opaque types and multiple number of documents required to clear goods at the ports aggravates the situation. If the current economic reforms are continued, a transparent and accountable expenditure procedures are implemented ABUJA 00000451 002.2 OF 002 to revamp infrastructure, and more emphasis placed on trade and investment policy and structural reforms progress is likely to continue. CAMPBELL