Over the years, the
value of trade between Nigeria has been lopsided. Due to the weak
manufacturing base of Nigeria and the inability to develop competitive
advantage in non oil exports, the lopsidedness has become pronounced.
According to the Japan External Trade Organisation (JETRO), as at
January, while Nigeria imported goods worth over $40.8 million from
Japan, the value of export to Japan was a paltry $3.97 million. This
leaves a trade balance of $36.89 million in favour of Japan.
Despite being the
fourth largest trading partner of Japan on the continent, value of
trade between Nigeria and the ‘Land of the Rising Sun’ actually
declined from the previous year when balance of payment stood at $37.7
million.
Gabriel Mmebo,
secretary of the Nigeria Japan Chamber of Commerce puts the low trade
between both countries on distance between both countries, in addition
to the poor state of infrastructure in the country.
“They even hardly
buy crude oil from Nigeria. If they can get it from countries closer to
them, I think it makes more economic sense for them to deal with such
countries.” According to him, major exports to Japan are mostly
commodities such as sesame seed, gum Arabic, animal horns, semi
processed wood as well as hides and skin but even these have not been
improved upon.
“Our (the chamber)
effort to boost trade with Japan has not been successful. Soon after
Obasanjo won the election in 1999, he visited Japan where he presented
them with items which they could import from Nigeria. There was another
trade delegation in 2009. But since then there has been no serious
follow-up.” He said the recent earthquake which occurred on March 11,
and the tsunami that followed would worsen the trade volume between
both countries due to the period of occurrence. “This is the period
when trading activities between both countries are usually high. With
this incidence, no one will be talking about trade but how to render
help to the people of Japan.”
Distance is no barrier
However, the issue
of distance would really have no effect on trade with Japan if the
enabling environment was in place. The country’s trade balance with
Africa is in the negative to the tune of $37.1 million. This indicates
that Japan’s trade value with her 13 trading partners on the continent
is largely in favour of the continent cumulative. For instance, exports
to Africa from as at January stood at $1.12 billion while imports stood
at $1.16 billion, leaving a negative trade balance in favour of Africa.
South Africa, Zimbabwe and Morocco all recorded trade advantage over
Japan, unlike Nigeria.
According to Mr
Mmebo, Japan has limited their businesses in Nigeria to only trade and
have closed down most manufacturing concerns due to the harsh business
climate in Nigeria. He said the adherence to quality by Japanese
manufacturers has made them not the favourites of many Nigerian
importers. “Japan does not have any serious investment in Nigeria.
Japanese imports are more expensive because they do not compromise
quality which is why Japanese imports are not very common in the
country.” This policy, he said, has also affected the volume of
Nigerian exports to the country. “Processes for exporting to Japan are
very stringent. There was a time Japan needed processed wood products
from Nigeria but we could hardly find Nigerian companies that could
meet their specification. So they had to leave. Their complains of poor
infrastructure is obvious,” Mr Mmebo said.
Worst disaster
This is the worst
disaster to hit Japan since the Second World War, and though there are
no official estimates yet, Goldman Sachs, the United States investment
firm believes it could be as high as $200 billion. The meltdown of its
nuclear reactors, fallout of the damage from the earthquake has raised
questions about how the debt ridden third largest economy would raise
funds to rebuild its economy.
“I believe that the
world will not allow Japan to suffer for long because with the size of
her economy, what affects Japan affects the developed and developing
economies,” according to Mr Mmebo. He said Nigeria would need to up her
game in order to be able to do more trade with Japan when the crisis
period is over. “They think we are our own problem because how do you
explain that a country with such huge oil and gas reserves yet cannot
generate enough electricity.” On enquiries to get latest official
figures, the Japanese embassy in Abuja said all its officials are busy
in seeking appropriate response to the crisis. “We have a crisis on our
hands now and nobody will be ready to talk unless it is on the crisis
and how it can be contained,” said John Nwankwo, spokesperson of the
embassy.
