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India, China, and Others to Drive Nigeria’s Export Trade Up by 9.7%

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non-oil exports

CEM REPORT, TRADE | A new report has listed 13 markets which will drive Nigeria’s export trade to $112 billion by 2030.

The report identifies these markets across Asia, Africa and the Middle East while noting that India, Indonesia, and Mainland China would be the major opportunity corridors that would spike Nigeria’s participation in global trade.

The report by Standard Chartered and its partners’ projects that Nigeria’s export trade would record a Year-on-Year (YoY) increase of 9.7 per cent.

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The report titled “Future of Trade 2030 – trends and Markets to Watch” highlighted that India will be Nigeria’s fastest and largest export corridor with exports expected to grow at an average of 12.4% yearly until 2030 and expected to reach around $112 billion.

The analysis, commissioned by Standard Chartered and conducted by PwC Singapore, examined historical trade data and estimates through 2030, as well as insights from a survey of more than 500 C-suite and senior executives from worldwide corporations.

According to the report, Nigeria’s future growth would be driven by existing and future investments in digital and physical infrastructure, as well as changes in the business environment.

“Driven by its Industrial Revolution Plan and National Digital Economy Policy (2020-2030), Nigeria has shifted its focus towards promoting digital transformation, financial inclusion, and physical infrastructure development with a series of billion-dollar projects. These efforts are forecasted to facilitate Nigeria’s plans for economic diversification and non-petroleum growth.”

Products fuelling this expansion, according to the research, include crude oil and natural gas, metals, and agricultural commodities.

According to the paper, Nigeria’s principal exports would be metals and minerals, with agriculture and food exports projected to expand its future trade pathways.

“India, Indonesia, and Mainland China will be the key corridors for Nigeria from 2020 to 2030. The rebound in global growth, as well as growing energy demand in Asia, will spur demand for crude petroleum. Nigeria has the largest natural gas reserves in Africa and ranks ninth globally in proven gas reserves. With the ongoing reforms to increase the role of gas in the energy mix, Asia Pacific LNG demand is expected to remain strong, driving Nigeria’s future export growth.

“Cocoa beans, sesame seeds, and cassava are Nigeria’s key agricultural exports. Nigeria is the world’s fourth-largest cocoa bean exporter and the largest cassava producer. Growing global demand for sesame seeds, underpinned by its positioning as a healthy product, and demand for ethanol and other cassava byproducts present strong export growth potential. Nigeria’s agriculture export share is small but expected to grow as Nigeria has prioritised agricultural development for its economic growth.”

The report noted Nigeria’s investment in digital infrastructure and efforts to create a seamless business environment as facilitating its growth.

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“Nigeria is actively nurturing its industrial sector through an array of tax and tariff breaks as well as reduced red tape and protectionist measures. It is working to streamline its trade procedures, lower trade-related costs, and reduce border delays. The government also offers a wide range of incentives, such as unrestricted profit repatriation, to attract FDI.”

The survey claimed that 14% of the 500 C-suite executives it questioned now or plan to source/manufacture in Nigeria within the next 5-10 years, indicating Nigeria’s attractiveness to global corporate executives.

The report stated that “global trade is set to grow by 70 per cent over the by 2030 next decade, with a shift towards more inclusive and sustainable practices.”

It added that Asia Pacific, Africa, and the Middle East would have the largest share of rising stars and hyper-growth markets of the future.

“Asia, Africa, and the Middle East will see a ramp-up in investment flows, with 82 per cent of respondents saying they are considering new production locations in these regions in the next five to 10 years, supporting the trend towards rebalancing to emerging markets and greater risk diversification of supply chains.”

The research also stated that global trade would be reshaped by five key trends, which are the wider adoption of sustainable and fair-trade practices.

“a push for more inclusive participation; greater risk diversification; more digitisation and a rebalancing towards high-growth emerging markets. Almost 90 per cent of the corporate leaders surveyed agreed that these trends will shape the future of trade and will form part of their five to 10-year cross-border expansion strategies.”

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