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
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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.
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Outreach Efforts
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.

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
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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
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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