A data from the National Bureau of Statistics have shown that Nigeria generated a total sum of N6.5tn from non-oil exports, N5.8tn lower than its N12.3tn ($30bn) target set by the Federal Government under its zero-oil plan within a three-year period covering December 2017 to December 2020.
In the fourth quarter 2016, the Nigerian Promotion Council conceived the Zero Oil Plan (a core component of the Federal Government’s Economic Recovery and Growth Plan) to increase the contribution of non-oil exports to Nigeria’s Gross Domestic Product by 20%.
According the NEPC 2016 annual report, the focus of the plan is to ‘generate at least a minimum of 40% to 50% of Nigeria earnings from non-oil export’.
Among other things, the report disclosed that the plan was expected to grow non-oil foreign exchange to $30bn by 2020.
The $30bn was to be generated from 11 strategic export products – such as petrochemicals, palm oil, cocoa, soybeans, and rubber – with high financial value to replace oil.
The $30bn target when converted to naira using the current official exchange rate of N411/$ equals N12.3tn.
The report read, “The Nigerian Export Promotion Council launched the Zero Oil Plan, a medium and long term strategy aimed at diversifying the economy from oil. Zero Oil Plan has become a key component of the Economic Recovery and Growth Plan.
“The overall targets set for the zero oil plan include: to grow non-oil foreign exchange from $2.7bn base to $30bn by 2020.”
A breakdown of non-oil exports during the review period shows that in 2017, non-oil exports contributed N629.9bn or 4.6 per cent of the total export of N13.6tn.
Out of the total export of N18.5tn recorded in 2018, only N1.9tn was generated from the export of non-oil products.
In 2019, non-oil exports accounted for N2.5tn of total export of N19.2tn recorded at the end of the year.
For 2020, Nigeria generated N1.4tn from non-oil exports, which constituted only 11.4% of its N12.5tn worth of export.
During the period under review, the Federal Government generated a total sum of N63.79tn from exports, out of which N6.5tn accrued from non-oil exports while N50.8tn was generated from exporting crude oil.
Consequently, crude oil remains the mainstay of the economy as it accounts for the largest share of total exports despite efforts of the Federal Government to reduce the country’s dependence on the product.
Speaking on the development, a financial expert and Professor of Economics at the Olabisi Onabanjo University, Ogun State, Sheriffdeen Tella, emphasised the need for the government to diversify the economy from oil and focus on boosting non-oil trade.
He added that in a few years time, oil might not be as profitable as it is currently.
Tella said, “There are alternatives to oil that are being developed. Many vehicles would not be running on oil. They may likely switch to gas and other alternatives. Also, it means some industries would not be running on oil very soon.
In the light of this, he called on the government to invest the profits accrued from oil exports to develop the non-oil sector.