Trade Policy Review: Nigeria
This fourth Trade Policy Review of Nigeria has given us a better understanding of the country's recent economic, including trade, policy developments and enabled us collectively to measure the challenges Nigeria currently faces in improving its economic prosperity. Our candid discussion has proved more engaging thanks to the full and open participation of the Nigerian delegation, led by H.E Frederick Agah, and by the insightful remarks made by the discussant, H.E. Faizel Ismail of South Africa, as well as active participation by numerous delegations.
Members appreciated Nigeria's active participation in the WTO and the constructive part it was playing in the DDA and noted the important role being played by Ambassador Agah as Chairman of the General Council, in the preparations for the 8th Ministerial Conference later this year.
On the positive side, Members commended Nigeria on its robust and broad-based economic growth during the review period, they welcomed the reduction in the average applied MFN tariff and the number of products on the import prohibition list while praising the steps taken to simplify customs procedures. Members also recognized Nigeria's efforts at diversification of the economy and regulatory reform. However, they also noted that reform would have to continue and the pace of reform would have to accelerate if Nigeria was to meet its own ambitious development objectives.
Some delegations however also stated that certain measures taken by Nigeria might not be compatible with its WTO commitments, such as import prohibition and restrictions and the Nigerian Content Development Act, which discriminates against foreign suppliers of goods and services in the oil and gas sector of the economy. Some delegations also noted that Nigeria continues to use trade restrictive measures to achieve objectives that could be better served with other policies.
The numerous statements, questions and replies voiced in the course of this Review have highlighted the fact that there remains room for significant further improvement of Nigeria's trade and trade‑related policies. In fact, there are a number of areas where reforms could be both beneficial to Nigeria and would help strengthen its international trade and investment. The Nigerian authorities might give thought to improvements that could be made in the following spheres:
- Legislative change: Some members mentioned the large number of draft bills at various stages of development, some of which had already been prepared at the time of the last review in 2005. Although some legislation has been enacted, many important pieces of legislation are still at the draft stage or have been before the National Assembly for some time. Delegations urged Nigeria to implement its planned reforms, in areas such as competition policy, contingency measures, the petroleum industry, and public utilities. Such reforms would provide a more conducive economic and investment environment.
- Transparency: Members stated the lack of transparency in existing laws and regulations including those pertaining to customs rules and procedures increase the cost of doing business in Nigeria. Members invited Nigeria to provide full transparency of its laws and regulations including import procedures and customs regulations.
- Tariff predictability: While they welcomed the reduction in the average applied MFN tariff from 29% in 2003 to 12% in 2009, some delegations were concerned that the significant gap between the applied MFN tariffs and the bound rates and the low level of tariff bindings created uncertainty and urged Nigeria to make its tariffs more predictable.
- National treatment: Members noted that some other duties and charges levied on imports appeared to be applied in a discriminatory fashion. They recommended that such discrepancies be eliminated in order that Nigeria fully comply with the WTO principle of national treatment.
- Intellectual property rights: Members noted that the current law on intellectual property was out-dated and, therefore, encouraged Nigeria to implement the new National Bill quickly, as well as strengthening protection and enforcement aspects.
- Government procurement: Members took note of the new Public Procurement Act and urged Nigeria to consider the benefits of becoming an observer to the WTO Agreement on Public Procurement as a first step toward full membership.
- Infrastructure: Several delegations, including the Nigerian, noted the poor state of infrastructure generally, particularly electricity while noting progress made in telecommunications. However, the welcomed the Government's new Power Sector Plan and progress made in privatisation and divestment in power generation, distribution and transmission.
This review of Nigeria's trade policy would not be complete without a mention of its booming film industry. Nollywood, as the movie production centre is called, is in close competition with its Hollywood (United States) and Bollywood (India) counterparts for first place in terms of volume of film production. This new industry, which has contributed to diversifying production in Nigeria, emerged in the early 1990s and currently provides direct or indirect employment for 2 million people, according to the sector concerned. A fine example that could serve as a case study for schools of economics and business administration. Moreover, there are a number of aspects that relate to our discussions, including audio‑visual services and intellectual property, amongst others. This is an industry that bears witness to the wealth of creativity in Nigeria.
In conclusion, this Review has confirmed the important role played by Nigeria in the multilateral trading system, as evidenced by the large number of advance questions and statements made. Once again, I thank the delegation of Nigeria, the discussant and Members for contributing to an informative and interesting review. I also wish to express my appreciation to the delegation of Nigeria for its oral and written responses during the meeting. We look forward to receiving Nigeria's outstanding responses within the coming month.