The British Deputy High Commissioner in Lagos, Mr. Ben Llewelyn-Jones, said that UK exports to Nigeria amounted to 3.3 billion pounds in the four quarters of 2022, noting its imports from Nigeria, in the period, amounted to 2.2 billion pounds. This, according to him, put the trade volume between the United Kingdom and Nigeria at 5.5 billion pounds.
Mr. Llewellyn-Jones gave the figures in an interview with the News Agency of Nigeria, NAN, in Lagos. He said the UK government was exploring ways to improve the trade relations with Nigeria, including partnering with it in bringing in electric meters. He said the UK government had also introduced the Developing Countries Trading Scheme, DCTS, that would encourage and improve exportation of goods from Nigeria.
He said that under the scheme, 99% of goods exported to the UK would be duty free and with the introduction of the DCTS, which would take off in April, 99% of Nigeria exports to the UK would be duty free, as we see this as a real opportunity to improve trading between both countries.
The United Kingdom government in its efforts to strengthen bilateral trade relationships with Nigeria and 64 other countries had launched the Developing Countries Trading Scheme (DCTS) which will kick off in 2023 spring.
The scheme which was launched in Lagos on Wednesday 25th January 2023, will replace the UK’s Generalized Scheme of Preference and offers one of the most generous sets of trading preferences in the world. The DCTS benefits 65 countries, 37 of which are African, and will mean that Nigeria benefits from duty-free trade on over 9200 products.
This is significantly more generous than both the EU’s GSP scheme and the US’ AGOA scheme and, based on current trade volumes, would mean that 99% of goods exported to the UK are duty-free. This is intended to help exporters and other people in the trading business to make the United Kingdom an export destination.
Speaking on the launch earlier, Ben Llewellyn-Jones had said Nigeria is one of UK’s most important partners in Africa and the UK Government is committed to working with Nigerian businesses and exporters to boost trade between both nations.
“One major benefit of this new UK trading scheme is that it abolishes tariffs on over 3000 everyday products that Nigeria currently exports including cocoa, cotton, plantain, flowers, fertilizers, tomatoes, frozen shrimps and sesame; the overarching aim of the new scheme is to grow free and fair trade with developing countries, boosting the economy and supporting jobs in those countries, as well as in ours,” he mentioned that the DCTS is a work which is part of a wider push by the UK to drive a free trade, pro-growth agenda across the globe, using trade to drive prosperity and help eradicate poverty.
The top 5 goods exported from the UK to Nigeria in the four quarters to the end of q3 2022 were:
• 33R – Refined oil (£1.0 billion or 59.3% of all UK goods exported to Nigeria)
• 65 – Textile fabrics (£56.8 million or 3.3%)
• 55 – Toilet & cleansing preparations (£49.3 million or 2.8%)
• 793 – Ships (£41.9 million or 2.4%)
• 05 – Vegetables & fruit (£32.8 million or 1.9%)
The top 5 goods imported to the UK from Nigeria in the four quarters to the end of q3 2022 were:
• 33O – Crude oil (£1.3 billion or 64.2% of all UK goods imported from Nigeria)
• 34 – Gas (£328.3 million or 16.8%)
• 33R – Refined oil (£325.7 million or 16.7%)
• 11 – Beverages (£4.5 million or 0.2%)
• 71MI – Mechanical power generators (intermediate) (£4.3 million or 0.2%)
Nigeria is targeting to grow its exports to the United Kingdom (UK) from 0.3% to 5% share of the market valued at £14 billion by 2030.
Executive Director/CEO of the Nigerian Export Promotion Council (NEPC), Dr. Ezra Yakusak, who made this known said it would be achieved through the recently launched Developing Countries Trade Scheme (DCTS) by the UK.
Under the new scheme, DCTS is to replace the UK’s current Generalized System of Preference (GSP), while Nigeria will now be benefiting from 9500 tariff lines instead of the previous eight. Besides, Nigeria no longer has to ratify the 36 conventions with the UK before trading. This is significantly more generous than both the EU’s GSP scheme and the US’ AGOA scheme and based on current trade volumes, would mean that 99% of goods exports to the UK are duty-free.
Ezra, who disclosed this at a workshop organized by the UK-Africa Trade and Investment Service, noted that the recent development by DCTS will boost trade with Least Developing Countries (LDCs) through reduced tariffs as well as simplified Rules of Origin for LDCs.
“The opportunity for Nigeria to increase its non-oil exports to the UK in sectors where supply currently exceeds the demand are cocoa, fertilizers, sesame, ginger, and cashew nuts. Others are natural rubber, cotton, frozen prawn, plantain, and tomatoes,” he added.
However, he lamented that several challenges have continued to inhibit the country from realizing its full potential. These, he said are issues of market access, access to affordable finance, cost and pricing, and poor regulatory regime/bureaucratic process among other infrastructural deficits such as bad road networks, power outages, and dilapidated port facilities leading to port congestions.
Based on this key indicators, and other prevailing trends of the UK-Nigeria Trade and Investment Relations, we at Cater and Merger Consult, is working in collaboration with the Ministry of Industry, Trade and Investment, the Nigeria High Commission and the British High Commission, to further strengthen our trade facilitation via major private sector driven initiatives and exchange opportunities in 2023.
Watch out for this year’s UK-Nigeria Trade and Investment Mission Summit 2023.