Nigeria’s intra-African trade has continued to underperform expectations despite the commencement of the African Continental Free Trade Area (AfCFTA) as the trade value fell Year-on-Year (YoY) to N842.6 billion in the first quarter of 2023 (Q1’23) 11.95 percent down from N956.93 billion in Q1’22.
AfCFTA, which aims to enable a free flow of goods and services across borders in Africa and boost the trading positions of the continent in the global market, is projected to boost trade within the region by 52.3 percent by 2025, according to the International Monetary Fund (IMF).
However, more than three years after the AfCFTA kick-off, Nigeria’s trade value with other African countries in relation to its total foreign trade remain low.
The National Bureau of Statistics (NBS) report on the Foreign Trade in Goods Statistics for Q1’23, showed that at N842.6 billion, Nigeria intra-African trade represented just 6.99 percent of its total foreign trade (N12.047 trillion) in Q1’23.
This is against the 7.4 percent contribution to its total foreign trade (N13.001trillion) in Q1’22.
On a Quarter-on-Quarter basis, Nigeria’s trade value with other African countries also declined by 24.87 percent to N842.6 billion in Q1’23 from N1.122 trillion in Q4’22.
Breakdown of the trade data, however, showed that Nigeria exported more than it imported with export value rising to N665.10 billion in Q1’23 from N444.418 billion in Q1’22, while imports fell to N177.50 billion in Q1’23 from N512.513 billion in the corresponding period in 2022.
Further analysis showed that the trade volume has been on a decline since 2021 when AfCFTA kicked off.
In 2020, the percentage of Nigeria’s intra-African trade as a proportion of its total foreign trade stood at 11.03 percent; the figure fell to 7.46 per cent in 2021 and went further down to 6.5 per cent in 2022.
Senior analyst, Parthian Partners, Okiki Oladipo, commenting on this, said that despite the potential of the AfCFTA agreement, implementation still remained an eyesore given the state of infrastructure among African countries and the issues of economic ties.
“When agreements like this that cut across both Anglophone and Francophone countries become a thing, there are usually many barriers to be pulled down. Thus, African nations have struggled with optimizing the agreement.
“For Nigeria to be better positioned to milk the benefit, there is a need to promote industrialisation in the country vis-a-vis fixing infrastructures that would aid optimal production cost.
“When this is done, Nigeria will become an export hub into other African countries, meeting the local content requirement while also exporting at a competitive price,” he said.
Chivita Hollandia unveils new Hollandia pack designs
Chivita Hollandia (CHI Limited), one of the top ten Fast Moving Consumer Goods Players in Nigeria recently unveiled new pack designs for its Hollandia range of Products.
The new pack designs reflect the premium image and high quality of the Hollandia brand, which offers a range of Value-Added Dairy Products across multiple segments – Evaporated Milk, Drinking Yoghurt, UHT Milk and Lactose Free Milk. The company also launched a new flavour into its Hollandia Yoghurt portfolio, Vanilla.
The new Hollandia pack design features the new Hollandia logo, which is enclosed in a seal signifying the stamp of high quality that the Hollandia brand is very well known for.
The new pack also displays the company’s new heritage as “A Product of the Coca-Cola Family” since the full acquisition of Chivita Hollandia (CHI Limited) by The Coca-Cola Company in 2019.
Since then, the company has invested over $125 million to further upgrade the quality and sustainability of its facilities.
Managing Director, Chivita Hollandia (CHI Limited), Mr. Eelco Weber remarked, “We are currently the largest beverage carton packaging manufacturing site in Sub-Saharan Africa. Next month we will install Lines 49 and 50.
“We have more than 4,500 employees responsible for making sure that only the best products reach our consumers daily. As we head towards producing two billion packs yearly, we remain committed to ensuring that our consumers receive nothing but the best.”
He further added, “We are very passionate about sustainability and protecting the environment. As part of our sustainability roadmap, we changed our energy generation to cleaner alternatives over the last year.
“We are also constantly looking to empower used beverage carton recyclers, which is why we tripled our collection rate in 2023 in comparison to last year.
“Our aim is to reduce our carbon footprint and positively impact the environment for generations to come. As one of the major FMCG Companies, we commit to continuing our role to drive sustainability in Nigeria.”
Speaking on the new Hollandia pack design, Marketing Director, Chivita Hollandia (CHI Limited), Mrs. Toyin Nnodi, highlighted the newly introduced Dairy Power stamp on the packaging.
She stated that, “The new design reinforces the brand’s promise to provide dairy power to its consumers. The stamp validates that Hollandia products contain the vitamins, minerals, and nutrients from dairy, which gives consumers the Dairy Power they need to stay ahead in their daily activities.”
Paint manufacturers receive 15 strategies to thrive
By Omolola Dede Adeyanju
The Paint Manufacturers Association of Nigeria (PMAN) in response to economic challenges has received critical strategic initiatives in order to thrive in a constantly evolving marketplace.
The initiatives were recommended at the association’s 32nd Annual General Meeting by the guest speaker, Principal Partner of Tomflims Associates International Limited, Hon.Ogundimu Leke lectured on the theme: ‘Post Fuel Subsidy Removal- Survival Strategies for Pains Manufacturers’.
Speaking, Hon.Ogundimu said, “According to the June edition of Nigeria Development Update, petrol subsidy has grown to be a huge fiscal burden on Nigeria’s economy as it increased from 1.1% of total revenue in 2020 to 32.4% in 2022 overshadowing budget allocations for health, education and social protection in the same year.”
“There was a dilemma and a tough decision the government was confronted with continuing the subsidy or deepening an unsustainable fiscal deficit or risking potential social and economic unrest by its removal. Fuel subsidy removal could save Nigeria around N7tn annually which could be channeled into infrastructure, education and health. Ghana removed fuel subsidies in 2013, causing petrol, kerosene, diesel and LPG prices to increase by 15% to 50% until reaching market levels by mid-September. They invested the savings into critical sectors.” He stated.
Hon. Ogundimu explained that as it stands, the elimination of fuel subsidy brings both challenges and opportunities.
He explained that the withdrawal of fuel subsidy led to a 150% to 200% surge in fuel costs (N500 – N600) across the country.
Also, he expressed, “Small and medium-sized enterprises are facing difficulties in accessing affordable power. As a measure to address these difficulties, the Federal Government has announced an N5bn palliative for each state, including the Federal Capital Territory, to cushion the impact of the removal of the petrol subsidy.”
He highlighted 15 critical strategic considerations Paint Manufacturers can implement for Response to Economic Challenges as; ‘Assess the; Situation; Define Clear Objectives; Strategic Planning; Cost Management;Digital Transformation; Diversification; Innovation; Customer Centric Approach; Talent Management; Risk Management; Monitor Progress; Adaptability; Communication; Collaboration; Long-term Vision.
“Paint Manufacturers may consider hedging strategies to mitigate these risks, such as; forward contracts to lock in exchange rates for future transactions; Currency hedging involves using financial instruments like forward contracts, options, or futures to protect against adverse currency movements.”
He further recommended that manufacturers embrace cost-cutting Innovations, stating that thehigh inflation and devaluation of the Naira has emphasized the importance of optimizing expenses. ‘Don’t be afraid to think outside the box and uncover innovative cost-cutting measures’ he urged.
Hon. Ogundimu concluded, “While the removal of subsidies, high inflation, and Naira devaluation have presented significant challenges for Nigerians and businesses, there is a silver lining amidst the storm. Implementing the above strategies can help transform challenges into opportunities and thrive in this new economic era. The key lies in embracing change, staying agile, and envisioning a future that transcends the obstacles of the present.”
In his welcome address, the Chairman, PMAN, Mr A.S Babatunde noted that this is the first Annual General Meeting to be held since the last one was held in 2018, he explained that the Covid 19 Pandemic disrupted economic, financial and social activities around the world especially in the areas of inputs supply chain and domestic foreign exchange availability.
Reiterating the theme of the AGM, the chairman pinpointed reasons why the theme becomes necessary at such time, saying, ‘The theme for the AGM was chosen because of the need for members of the Association to explore ways and means on how to survive in the present economic challenges posed by the sudden and unprepared removal of subsidy on petroleum by the Federal Government, which has further disrupted secial and economic activities in the country. The need for paint manufacturers in the country to look inward and come up with strategies to sustain their business so as to remain afloat also influenced the choice of the theme’ he revealed.
FG to build industrial hubs for job creation
The Federal Government says it will establish industrial hubs to accelerate job creation to tackle rising unemployment in the country.
President Bola Tinubu said this at the 55th International Conference of the Chartered Institute of Personnel Management (CIPM) on Tuesday in Abuja.
The theme of the conference is “Sustainable Human Resources (HR), Business and National Development.”
Represented by Nkiru Onyejeocha, the Minister of State for Labour and Employment, Tinubu said that his administration was geared to steer Nigeria towards self-reliance and reduce dependency on others in the face of global challenges.
“We envision an unprecedented level of industrial activity, marked by the establishment of unique industrial hubs tailored to the strengths of each region in our great nation,” he said.
He reiterated the federal government’s commitment to end poverty, adding this was deeply intertwined with our focus on economic growth and job creation.
“We recognise that sustainable development can only be achieved by fostering an environment where job opportunities abound, ensuring food security and eradicating poverty.
“In the pursuit of our vision, inclusivity is paramount, we will prominently feature women and youth in all our endeavours, recognising them as integral contributors to our nation’s success,” the President said.
He said that HR practitioners play a crucial role in moulding and effectively managing people to become catalysts for economic resurgence in an increasingly competitive and changing world.
Earlier, the President and Chairman, Governing Council of the CIPM, Mr Olusegun Mojeed said that this year’s theme was borne out of the fact that most industries in today’s ecosystem were experiencing rapid and exponential bouts of change triggered by disruptive technologies and increase agile nature of the external market.
“Now more than ever, HR is charged with the responsibility of shaping a progressive organisation and nation. Sustainable people practice is a strong catalyst for cultural, national, and infrastructural development, amongst others.
“Talent supply will play a major role in creating and shaping the conditions in which organisations and nations will operate. Let me once again appreciate my HR colleagues for where we have taken HR post-COVID-19.
“Thank you for showing up and continuing that upward trajectory,” he said.
According to him, the conference seeks to provide cutting edge solutions for people managers and leaders to navigate the changing times and build sustainable HR practices with the end goal being business and national development.
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