Nigeria’s level of exports under the African Growth and Opportunity Act (AGOA) rose by several million dollars in 2017, driven by the oil sector of the economy.
The exports of Africa’s biggest oil producer went from about $3.4 billion in 2015 to $6 billion last year. The country they did have some growth in agricultural exports but the levels are still very small, it went from around $3 million to $9 million, a fraction of the level of exports.
“I think the key thing for Nigeria is diversification”, said Harry Sullivan, acting director for Economic and Regional Affairs at the U.S. State Department’s Bureau of African Affairs.
“So if you just want to increase exports to the United States, we’re always interested in oil and petroleum-derived products. But I think really in order to spread the wealth, Nigeria needs to diversify into other products. And I know that the government, for instance, is trying to spur greater agricultural diversification, certainly more agricultural products could mean more agricultural exports to the United States”, Sullivan told journalists across the region and beyond, in a telephonic press briefing on Tuesday.
Total U.S. trade with sub-Saharan Africa rose 16.8%, from $33 billion in 2016, to $38.5 billion in 2017. U.S. exports to African increased 4% to $13.1 billion, while African exports to the United States rose by more than 24% to more than $24 billion.
“Increased oil exports did account for a large share of this increase, but we also saw some encouraging signs of diversification”.
African exports of agricultural products to the United States rose 10% to $2.7 billion in 2017. Between 2016 and 2017, Ghana saw its exports to the United States more than double, with exports under AGOA quadrupling to more than $300 million. Madagascar also registered strong growth in garment exports under AGOA by more than 57% to $152 billion. Ethiopian exports under AGOA rose 35% to 92 billion. Countries like Senegal, Rwanda, Namibia, and Uganda have also succeeded in boosting overall exports to the United States and exports under AGOA.
“We’re continuing to work with African countries to help them reduce impediments to trade, strengthening their enabling environments for investment, and putting in place the right ingredients for the private sector to thrive, both the domestic African private sector and foreign investment”, Sullivan added.
Sullivan described Nigeria as the largest market in Africa, a potential market for local industries, and that the whole ECOWAS market is behind Nigeria.
He encouraged Nigeria to liberalise in order to attract greater foreign investment. “Because there is a great interest in foreign companies and servicing the Nigerian market, but where investment has fallen, it’s because there have been a lot of restrictions on doing business in Nigeria that have thwarted not only foreign investment but also, I believe, domestic investment as well”, he said.