Cet article est uniquement disponible en Anglais.

Ceci est un article de la publication "51: Special Issue: Nigeria", publiée le 1 février 2011.

The Agro-Pastoral Product With Neighbouring Coutries: What’s at stake?

Bio Goura Soulé

Commerce régional / intégration régionalePolitiques commercialesNigeria

Nigeria is a central actor in the trade of farm and livestock products between countries in the sub-region. This article presents and analyses intra-regional trade in West Africa.

Trade between Nigeria and its neighbours in West Africa (Niger and Benin) and in Central Africa (Cameroon, Chad, Equatorial Guinea) is intense and long-standing. As a consequence of its economic importance (over 50% of GDP in ECOWAS), population (one out of every two West Africans is Nigerian), and contrasting levels of development compared to neighbouring countries, Nigeria accounts for more than 60% of intra-regional trade in West Africa.
This trade involves primarily agricultural products and manufactured goods, in large part hydrocarbons. Over 50% of the petroleum consumed in Benin and Niger is supplied by Nigeria. Farm trade is nonetheless of major importance, in particular the foodstuffs that are consumed by the population.
Trade in agricultural products between Nigeria and its neighbours has expanded greatly over the last thirty years, and now has a well-established structure, including both formal and informal elements. In addition to reciprocal trade that complies to some extent with current regulations, there are exchanges that exploit the opportunities created by the multiple trade, fiscal and monetary divergences between the Federation of Nigeria and its neighbours in the franc zone.

Nigerian Exports to Neighbouring Countries. As producer of 75% of the dry grains grown in western and central Africa, Nigeria is a net supplier of millet, sorghum and maize to Niger, Chad and occasionally northern Cameroon. Transactions with these three countries represent a volume of around 500,000 tonnes annually, and constitute a food safety valve for Niger and Chad, countries that regularly experience food shortages that are more or less severe.
Root plants and tubers are the second largest category of products exported by Nigeria to neighbouring countries, in particular yams and cassava products (mainly gari). While total production is estimated at around 80 million tonnes, Nigerian exports of yams and cassava products do not reach the volume of grain exports.
The third category of Nigerian agricultural exports includes counterseasonal crops, principally potatoes and tomatoes. Nigerian potatoes, that compete successfully with extra-African imports on markets in Benin, show that local products can find local outlets if production is encouraged by appropriate incentives, primarily better access to the production factors (inputs and irrigation) needed for cultivation. Potatoes are grown in several irrigated sectors that were initially intended for rice or wheat crops in northern states such as Kano and Jigawa.

Imports from the Surrounding Region. Only a limited range of farm and livestock products have been exported by neighbouring countries to Nigeria in recent years. The main imports are cowpeas (niebe) and tigernuts (souchet), mainly from Niger. Niger’s cowpea exports have been erratic. In the 1970s and 1980s, they stood at around 300,000 tonnes per year, and then fell to under 100,000 tonnes in the 1990s. The policy deployed by the government of Niger over the 2000- 2010 decade was based on better guidance for growers, price incentives, and organised harvest collection; it doubled production volume, estimated at over 1 million tonnes in 2008. Half of the crop is exported to Nigeria that implicitly supports cultivation of this legume in Niger by offering a sure and steady market outlet.
The market for live animals is also growing rapidly. On top of exports from Niger, Chad and Centrafrique, via Chad and northern Cameroon, to Nigeria there are now exports from Burkina Faso, via Benin. It is estimated that one million head of cattle are traded each year.

Informal Trade Fuelled by Nigeria’s Protectionist Stance. The exchange of agricultural and pastoral products drives trade that is mutually beneficial for States and for the private sector. Trade development is hindered, however, by the unpredictable nature of Nigerian trade policy and by the numerous obstacles (periodic import and export bans on certain products, graft by inspection and enforcement officers) that relegate a portion of transactions to the informal sector or even to illicit trafficking.
Indeed, the outstanding feature of Nigeria’s trade relations with its neighbours is the prevalence of informal (i.e. unrecorded) transactions for a certain number of products. This trafficking probably began with cocoa deals in the late 1960s and early 1970s. The civil war in Nigeria disrupted trade channels in Nigeria, facilitating contraband cocoa, much of which passed through Benin to reach the international market. Although Benin had no cocoa plantations on its territory, cocoa accounted for 40% of the country’s official exports between 1968 and 1970.
The measures deployed by the Nigerian government to counter the effects of the second oil crisis, including rationing or outright embargoes on certain mass market commodities (rice, wheat, wheat flour) gave rise to an almost-legal form of smuggling: re-export trade. In this type of transaction, a country imports consumer products in excess of its domestic needs, and exports the surplus to other countries, taking advantage of differing protective trade tariffs. Unlike through-country trade that allows land-locked countries to receive supplies via coastal countries, re-export is a fraudulent activity. It involves products that are either banned or highly taxed as imports by the country of final destination.

The underside of Intra-ECOWAS Trade

This contraband remains vigorous, and is stimulated by the market protection measures taken by the Nigerian government. For example, Nigeria’s protection of the rice market went from an initial ban on imports, to a 300% duty in 1994, then 100% in 1998, and finally stabilised at a tariff around 50% at the beginning of the 2000s. Since the adoption of the Common External Tariff (CET) by ECOWAS, the rate of protection is now 30% for Benin and 31% for Niger, positioning these two countries as the largest re-exporters in the zone. Re-export volume is estimated to exceed 500,000 tonnes per year. After rice re-exports come butcher meat, in particular poultry cuts (over 50,000 tonnes traded) and golden apples.

Trade Driven by Opportunity and Opportunism. Trade in farm products and livestock is organised and carried out via structured merchant channels, sometimes on a regional scale. The economic, financial and strategic stakes are high for this trade, and the different stakeholders—States, economic operators and consumers—are not always all winners. The overall value of trade in agrifood products between Nigeria and neighbouring countries is estimated at more than $1 billion, broken down as follows: exported livestock on the hoof, $350 million; re-exports from neighbouring countries to Nigeria (rice, poultry cuts, apples), $300% million; locally grown grains, $200 million; and about $100% million for other contraband (cowpeas, yams, cassava flour, potatoes, tomatoes, onions, other spices) for the most part from Nigeria to neighbouring countries.
The added value of these transactions goes essentially to economic operators, some of whom have formed networks with very strong ties to complicit public authorities. This trade has allowed a class of prosperous businessmen to flourish, whose strategies constantly defy the rules set forth by regional integration organizations and by States.
The countries involved (Nigeria, Benin, Niger, Cameroon and Chad) do not share the same analysis of the effects and impacts of these transactions, even though all agree that they help consolidate the ongoing regional integration process. For Nigeria, the re-exportation situation is less a factor mitigating the effects of the economic and financial crisis that has diminished urban consumers’ purchasing power, than it is a phenomenon that wipes out the government’s efforts to jumpstart domestic agricultural and industrial production. Inversely, for Benin and Niger this type of transaction brings considerable financial resources, and their budgets, fuelled by various taxes levied on re-exported products, would be in serious trouble if re-exports were eliminated. The recent crisis between Benin and Niger that arose over the rationing of Niger’s vegetable oil imports, in part re-exported to Nigeria, is a good illustration of how these two countries have internalised the economic stakes associated with this quasi-official contraband.
The creation of the ECOWAS customs union, with a five-band CET, will bring on a restructuring of the regional market and more fluid intra-community transactions. National fiscal regimes will have to be harmonised to accompany this union, however—Niger and Benin apply 18% VAT, compared to 5%in Nigeria—if it is to significantly reduce contraband and foster an attractive market zone. The hesitation and procrastination observed in the CET negotiations leave little room for hope that this will be achieved in the near future.

Restez informé⸱e !

Abonnez-vous à nos publications et bulletins pour les recevoir directement dans votre boîte mail.

  • Ce champ n’est utilisé qu’à des fins de validation et devrait rester inchangé.

Autres articles qui pourraient vous intéresser

Grain de sel No. 51: Nigeria. A Look at the Agricultural Giant of West Africa

Contents A Grain de sel “Country Report” Editorial The Nigerian Giant, an Imposing Neighbour Jean François Sempéré Benchmarks Benchmark – Nigeria Inter-réseaux Forum Nigeria: Called to Hegemony Daniel C. Bach With its privileged position in the sub-region, Nigeria is poised to play a pivotal role in ECOWAS. But Nigeria’s elites and its public policies must show that they are up to this challenge. On the way to a single currency for ECOWAS Countries ? Gilles Dufrénot The ECOWAS…

Lire PDF
A Grain de sel “Country Report”

Breaking with its custom, Grain de sel is devoting this issue exclusively to one country, Nigeria. Why this country? Nigeria alone represents half of the population of West Africa and half of its economy. Despite its size and influence on all surrounding countries, most rural and agricultural development actors in French-speaking countries (and sometimes in English-speaking countries as well) both in the North and within Africa know little about Nigeria. This special issue contains reports on initiatives, analytical…

Lire PDF
The Nigerian Giant, an Imposing Neighbour
Jean François Sempéré

By its size and population Nigeria is almost a subcontinent in and of itself. The country continues to have one of the most dynamic economies in Africa, with GDP growth of around 6% in 2009. The effects of the international crisis have been felt, however, with a significant drop in oil prices, scarcer credit and a financial sector made fragile by toxic assets. These factors threaten the precarious macroeconomic equilibrium that had been attained between 2003 and 2007,…

Benchmark – Nigeria

Facts on Nigeria Agricultural Activity in Nigeria A Large and Divided Population. With a population of over 150 million people, Nigeria is the most populous country in Africa. It is home to one-sixth of the continent’s population, and to half of the people in ECOWAS. It is also one of the most urbanised countries in Africa, with at least twenty-four cities of over 100,000 residents. Nigeria is highly diverse, with a large number of ethnic, cultural, linguistic and…

Lire PDF
Nigeria: Called to Hegemony
Daniel Bach

With its privileged position in the sub-region, Nigeria is poised to play a pivotal role in ECOWAS. But Nigeria’s elites and its public policies must show that they are up to this challenge. A Decisive Economic Influence in the Sub-Region. Both within and outside of the country, Nigeria’s vocation to dominate and structure the sub-regional environment is no longer contested, and Nigeria is expected to play a key role in African and international organizations. The time is long…

Lire PDF
On the way to a single currency for ECOWAS Countries ?
Gilles Dufrénot

The ECOWAS countries are on the way to establishing a single currency by 2020. Nigeria is poised to play a major role in this process. While the plan apparently has unanimous support, “the devil is in the details.” Grain de sel: What is your analysis of the currencies now in use in West Africa? Gilles Dufrénot: The “currency map” of West Africa comprises several different exchange regimes. There is a monetary union, made up of the eight countries…

Lire PDF
Staple crop production and consumption: Nigeria on the way to food self-sufficiency

Nigeria is endowed with abundant natural resources and has substantial agricultural potential. While it ranks first among the leading agricultural producers in the region, it is also the largest importer of staple products in West Africa. Despite the preponderance of hydrocarbons, the agricultural sector continues to play a decisive role in Nigeria’s economic development. Agriculture accounts for about 36,5% of the creation of gross domestic product in the country and employs nearly 45% of the country’s workforce. With…

Lire PDF
Demand for farm animal products in Nigeria: An opportunity for Sahel Countries?
Bernard Bonnet, Bertrand Guibert, Christophe Bénard

Nigeria is a major hub of animal product consumption in West Africa. It is also one of the largest livestock-raising countries in the region. Meeting the ever-increasing domestic demand and access to these flourishing markets are major economic stakes for Nigeria and for the neighbouring Sahel countries that raise livestock. By its population and capacity for animal production, with 25% of livestock herds in the sub-region, Nigeria is by far the leading livestock producer in Central and West…

Lire PDF
Nigeria’s Agricultural Policy: Seeking Coherence Within strategic Frameworks
Fanny Grandval, Mathilde Douillet

While Nigeria has many singular features, the country is no exception when it comes to agricultural policy in the region, caught between enormous potential, immense ambitions, and still-insufficient concrete results. Nigeria is the most populous country in Africa, with an urban population growing at an exponential rate. The government’s objective of achieving food self-sufficiency is a major challenge. In this country that is experiencing relatively rapid economic growth, this goal is not unrealistic but will require a great…

Lire PDF
Historic Oppotunities for Rice Growers in Nigeria
J. Manful, adiagne, ibamba, ojajayi-ng

The rice value chain in Nigeria is in a period of growth, thanks in particular to strong support policies. Work remains to be done, however, to give growers access to improved seeds and improve quality, so that locally grown rice can fully meet the needs of urban consumers. Local rice cultivation provides livelihoods for many producers, processors and vendors in Nigeria. However, it does not satisfy the totality of consumer demand in the country. Nigeria imports on average…

Lire PDF
Nigeria: From Customs exceptions to a Regional Trade Policy

Nigeria stands out in the sub-region for its traditionally protectionist trade policy. This tendency, which is partly in question today, has slowed down the process of West African regional integration. Nigeria’s trade policy is above all a tool to foster growth, and is framed to be consistent with the country’s overall development objectives. This policy is formulated and implemented via legislation and regulation, as well as by directives issued by the federal Ministry of Finance. Protectionism Is Losing…

Lire PDF
The Agro-Pastoral Product With Neighbouring Coutries: What’s at stake?
Bio Goura Soulé

Nigeria is a central actor in the trade of farm and livestock products between countries in the sub-region. This article presents and analyses intra-regional trade in West Africa. Trade between Nigeria and its neighbours in West Africa (Niger and Benin) and in Central Africa (Cameroon, Chad, Equatorial Guinea) is intense and long-standing. As a consequence of its economic importance (over 50% of GDP in ECOWAS), population (one out of every two West Africans is Nigerian), and contrasting levels…

Nigeria’s role in Niger’s Food Security

Some land-locked Sahel countries in Africa are dependent on cross-border trade for their food security. What is the situation in Niger today? How do the cross-border flows of staple foodstuffs from Nigeria allow Niger to ensure its food security? This article describes the trade between these two countries. Without the farm and animal products that arrive from Nigeria, it is hard to imagine how food security could be assured for the people of Niger. Given that the country…

Lire PDF
A look at agriculture and agribusiness in Nigeria
Inter-réseaux, Ndidi Okonkwo Nwuneli

Agriculture in Nigeria as seen by a Nigerian specialist. In some respects, the circumstances in Nigeria resemble those of neighbouring countries. In this analysis, the emphasis is on pragmatic approaches and the spirit of enterprise, whether family-run businesses or larger-scale operations. Grain de Sel: What is your diagnosis of the agricultural sector in Nigeria? Ndidi Nwuneli: Agriculture is the most important sector in the Nigerian economy. It employs 60% of Nigerians, including many rural women, and contributes up…

Lire PDF
Farmers’ Organizations Not Yet Unified in Nigeria

There are a great many farmers’ organizations in Nigeria, but can we speak of a Nigerian “farmers’ movement”? Between the large umbrella organizations that are sometimes manipulated by the government authorities, and a multitude of local initiatives, Nigerian farmers are now beginning to look for a path to unity. Even if farmers’ organizations (FOs) in Nigeria are not yet well structured, several broad categories can be distinguished: FOs with a general scope and focus on advocacy; FOs set…

Lire PDF
The Nigerian Giant Hungers for its Neighbours’ Coconuts
Ambrose Kwaku, François Ruf, Jérémy Salinier, courbetp

Nigeria is generally seen as a regional giant capable of stimulating the agricultural economies of neighbouring countries. Without appropriate public policies, however, regional integration has its limits. Here, we illustrate this with a case study of a little-known activity, the coconut value chain in Ghana. At scientific meeting in 1990, a researcher displayed a map of agricultural production in West Africa with a large blank space for Nigeria, indicating the absence of reliable data on this regional giant….

Lire PDF
News from Inter-réseaux

Grain de sel The subjects of upcoming special reports to be published by Grain de sel (GDS) in 2011 have been selected by the Board of Directors according to the suggestions made by the editorial committee. The topics covered will be: – grains (June); – land tenure (September). Readers are encouraged to make their own suggestions and propose articles on these topics (see the back cover for details on submitting articles). The results of the survey of GDS…

Lire PDF
Getting Fertiliser into farmers' Hands
Ketline Adodo, bkiger

To facilitate access to subsidised fertiliser for smallholder farmers in Nigeria, IFDC developed a fertiliser voucher programme that relies on a public-private partnership. This initiative has met with resounding success, even if many limitations remain to be addressed. Haladu Afdu, chairman of the Jumar Kwari Kamfa Fadama Farmers Cooperative in Wudil (Kano state), has just paid for two 50-kg bags of subsidised mineral fertiliser upon presentation of a voucher coupon that was allotted to each member of his…

Lire PDF