So many questions on what Onitsha traders are exporting while responding to my call for Nigeria to open land borders for exports even if we keep them closed for imports! But before my response, let me share this comment from Francis.
Now, here is my response:
Most big manufacturers like Unilever and Consolidated Breweries use Nigeria as a hub to serve some west and central African countries. Because of the proximity of Cameroon to Aba, Unilever uses land borders to move its goods to that nation. In Onitsha, we have many small scale manufacturers making biscuits, cosmetics, etc which serve smaller West African nations. It is important to understand that some African countries see Nigeria in the same dimension as we see United States.
Pharmaceutical firms in Nigeria serve most markets like Togo, Benin Republic and southern Cameroon. In short, in my village of Ovim (Abia State), we have a beverage maker whose 100% market is Cameroon. He does not sell his products in Nigeria as he makes more money in Cameroon than Nigeria even though he sources the raw materials from Oron in Akwa Ibom.
So, when we write Onitsha or Aba, do not just think these guys are just traders. Also understand that many manufacturers serve Niger Republic from northern Nigeria. They manufacture in Nigeria even though they sell in Chad and Niger. There are many reasons for that – Nigeria’s has a more advanced banking system and deeper talent base to support production.
Largely, if this border closure continues, I expect companies like FrieslandCampina WAMCO (makers of peak milk), Cowbell, Unilever to experience massive revenue drops in 2019. Most of these entities serve other small African countries via land borders.
You may argue why not use sea to move these items – the fact is this, by the time you load a truck and travel from Aba to Lagos, you are largely already in Cameroon. And then it has to spend 3 months in the sea. Why do that especially for perishable or time-sensitive items like drinks, food items and medicine? It makes no sense.
The closure of border is simply saying that Customs is not doing its work well. If Customs does its works well, this will not be needed. Also, the argument that import revenue is improving because land borders are closed must also be evaluated on how much exports have been affected. We can make extra N2 trillion from import fees while our local industries that serve small African countries go out of business! Government will have more money in its vaults while families will lose breadwinners.---
1. Advance your career with Tekedia Mini-MBA (Sept 13 – Dec 6, 2021): 140 global faculty, online, self-paced, $140 (or N50,000 naira). Click and register here.
2. Click to join Tekedia Capital Syndicate and own a piece of Africa’s finest startups with a minimum of $10,000 investment.3. Register and join me every Saturday at Business Growth Playbooks w/ Ndubuisi Ekekwe (Sept 4 – Oct 23, 2021), Zoom, 4.30pm WAT; costs N20,000 or $60.