ECONOMIC RECOVERY: NIGERIA EARNS ABOUT FOUR TRILLION NAIRA THROUGH RAW MATERIALS 18-01-25
By Sadiq Aminu Raw Materials and Research Development Council RMRDC, has Inaugurated it first Quarterly Statistical Bulletin in Abuja to Drive Nigeria’s Industrial Growth.
This is to provide an evidence-based data and actionable insights to enhance local sourcing and investments in raw materials.
This publication also delivered a detailed data on key economic indicators, including Nigeria’s foreign trade, raw materials processing, and utilization rates, to bridge existing data gap and empower stakeholders to make informed decisions that will drive the country’s industrialization.
The Quarterly Statistical Bulletin Series was designed to offer crucial insights into the availability, sourcing, and utilization of raw materials within Nigeria, providing accessible information for businesses and policymakers to foster a stronger, more sustainable industrial sector.
According to the Director General of RMRDC, Prof. Nnanyelugo Ike-Muonso, “Nigeria’s manufacturing sector contributes only about 3% of the nation’s foreign exchange earnings, and over 30% of import bill linked to raw materials and intermediate goods that could otherwise be sourced locally.
This situation, Prof. Ike-Muonso, described as unsustainable, and believed that the solution lies in promoting local sourcing, harnessing our abundant natural resources, and developing innovative value chains for rapid economic growth.
*Other objectives*
The Quarterly Statistical Bulletin Series is aimed at supporting several key stakeholders:
• Government Policymakers: Offering data-driven guidance to promote local sourcing, domestic manufacturing, and industrial development.
• Investors: Identifying emerging opportunities within Nigeria’s resource-based industries.
• Industrialists: Equipping industries with the data to optimize local raw material usage, foster innovation, reduce costs, and boost competitiveness.
• Academia: Providing valuable research material to enhance studies in material sciences, engineering, and industrial development.
• Organized Private Sector: Empowering collaboration between the private sector, government, and other stakeholders to promote industrial growth.
The Director General of RMRDC also extended the Council’s gratitude to its key partners, including the Nigeria Customs Service , Manufacturers Association of Nigeria (MAN), and other stakeholders who supported the production of the Data for development of Raw materials.
According to the DG, the Quarterly Statistical Bulletin offers detailed insights into Nigeria’s trade performance for three quarters of the year, 2024, focusing on imports, exports, agricultural raw materials, and opportunities for import substitution.
*”Total imports in the first quarter of 2024 amounted to N2.3 trillion.*”
*Energy and Construction materials*
The report highlights key imports, including petroleum jelly, sulfur, kaolin, and oils.
The energy and construction sectors were the most dependent on foreign imports, with energy materials alone accounting for over N1.5 trillion.
This underscores the heavy reliance on foreign sources for essential raw materials, particularly in the energy sector.
*Nigeria’s raw materials export trade totaled N3.9 trillion for the same period, with notable exports including petroleum oils, natural gas, and minerals such as quartz, titanium ores, and bituminous coal*.
The Date indicates these strong export figures highlight Nigeria’s significant role in global mineral and energy resource supply chains.
*Leading Raw Materials*
According to the data, Agricultural raw materials continue to play a vital role in Nigeria’s trade.
In first quarters of 2024, agricultural exports reached N226 billion, led by cocoa beans, cashew nuts, and sesame seeds.
However, agricultural imports amounted to N1.1 trillion, driven by the need for food supplements, milk preparations, and palm oil.
According to some analysts, this imbalance indicates a need for enhanced local processing capabilities to meet demand and capitalize on Nigeria’s agricultural potential.
The report however identifies opportunities for import substitution and highlights sectors where Nigeria could benefit from increased local production.
Key examples include cocoa (where Nigeria imports derivatives like cocoa powder and butter despite being a major exporter), ginger (importing ginger powder and essential oils), and tin/zinc (despite being exporters of these materials, refined products and alloys are still imported).
*Most Utilized raw Material*
Nigeria’s local raw material utilization rates vary. Petroleum oil is the most utilized mineral with a rate of 54.6%, followed by cement, bituminous coal, and tin ores.
The agricultural sector also shows high local utilization, with cane sugar being the most utilized at 56.1%.
The report emphasizes the potential benefits of increasing local processing, which could reduce reliance on imports and create significant economic growth opportunities.
*Economic Value addition*
On the economic impact of value addition for the period under review, according to the report, currently, Nigeria’s value addition rate stands at 25%, with projections indicating that increasing this rate could lead to a 15.6% increase in employment, a 2.2% rise in industrial output, and a 21.25% improvement in the exchange rate against the dollar.
On sectoral expenditure and other critical insights within the period under review, Prof Ike Muonso quotes the report states that in Q1 2024, Nigeria spent over N1.06 trillion on importing agricultural raw materials, with energy materials making up over N2 trillion.
These figures highlight the critical importance of energy materials and agricultural inputs to Nigeria’s trade balance and the potential for greater self-reliance through local production.
*Opportunities*
The Director General of RMRDC said in the overall, the data highlights significant opportunities for Nigeria to reduce its reliance on imports, particularly in the agricultural and mineral raw materials sectors.
*”By strengthening local processing capabilities and focusing on value addition, Nigeria can drive industrial growth, create jobs, and enhance its economic stability”* he said.