As the petrodollar economy crashes to the lowest level in history, there is an urgent need for Nigeria to increase local production, boost non-oil exports in order to earn more foreign exchange.
Nigeria, a major oil-exporting country had earlier benchmarked its 2020 budget on $57 per barrel oil price, but the outbreak of coronavirus pandemic has crashed prices to below $20 per barrel thereby throwing the nation off balance on the budget implementation.

Managing Director, Nigerian Ports Authority, Hadiza Bala Usman, among other stakeholders that spoke at an interactive session on Webinar, tagged, ‘Non-Oil Exports: Disrupting Nigeria’s Growth Cycle’, which was organised by BudgIT, bemoaned the low level of non-oil export in the country.
Usman said the expected revenue from the seaports might drop by 75 per cent, as crude exports and prices decline due to the effect of COVID-19.

She said: “By the reduced crude oil price and shipment, revenue expected by the government from the ports will be reduced by 75 per cent.

“This underscores the importance of diversification of the economy through non-oil exports so that we can reverse this trend.

“There is the need to encourage local investors. We are a large country of consumers. We need to increase local production. We need to make domestic investment a priority, she said.

Usman said about 191 million metric tons of export cargo passed through the nation’s seaports in 2019, 78 percent of which was crude oil cargo, while the remaining 22 per cent was non-oil export.
Executive Secretary, Nigeria Investment Promotion Council (NIPC), Yewande Sadiku, predicted that Foreign Direct Investment (FDI) into countries in Africa is expected to fall by 30-40 per cent in 2020-2021.

She stressed that Nigeria needs not only to attract more foreign direct investment but to also increase production capacity in-country in order to grow the non-oil export.

Sadiku, who listed countries such as United States, China, Singapore, Netherland and United Kingdom as top recipient of FDI globally, said that Africa, which contributes 17 per cent of the global population, is only able to attract three per cent of global FDI.

She said: “Whether oil or non-oil export, investors are looking for one thing, which is a conducive environment, financial return as well as sustainable and available asset,”

According to her, Nigeria needs to encourage domestic investors by increasing the rate of incentives extended to domestic investors via tax, removal of administrative and regulatory bottlenecks, quick delivery aftercare /investors care, and improvement in the business environment.

She called on multinationals to diversify their production base without concentrating on one region.

Publisher, Nairametrics, Ugo Obi Chukwu, emphasised the need to do away with reliance on crude oil as a nation.

He said that Nigeria would continue to surfer currency depreciation if the country does not diversify immediately.

Chukwu noted that a country that relies on oil to earn revenue especially foreign exchange, would not develop.