KANU IHUOMA .N.

1

PROBLEMS AND PROSPECT OF MARKETING NON - OIL

EXPORT PRODUTS OF NIGERIA

A CASE STUDY OF ENUGU STATE

BY

KANU IHUOMA .N.

PG/MBA/05/4571

DEPARTMENT OF MARKETING

FACULTY OF BUSINESS ADMINISTRATION

UNIVERSITY OF NIGERIA ENUGU CAMPUS

AUGUST 2006

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CERTIFICATION

I, Kanu Ihuoma .N. a postgraduate student in the Department of

marketing, with registration number PG/MBA/05/45701, has satisfactory

completed this research project needed for the award of a master’s

Degree of Business Administration (MBA) in marketing.

.............................. …………………………

C B ACHISON Dr. I. C NWAIZUGBE

Project Supervision Head of Department

………………………. …………………………

Date Date

3

DEDICATION

To Almighty God, for His assistance and guidance through out

my (MB A) programme.

Also to my beloved parent Mazi and Mrs. E. O. Kanu. My

Brothers, Chike, Barr. OGB, Engr. Uzo, Kene, Onyi, for their moral

support.

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ABSTRACT

In the face of dwindling foreign exchange earning from Crude Oil

due to the global oil glut, the Federal Government of Nigeria was forced

to revisit the abandoned non – oil sector of the economy for extra

revenue Non- Oil sector was the major foreign exchange earner before

the discovery of oil in the early 60s. It was therefore the objective of the

research work to unveil the factors that worked against the marketing of

non – oil export products from Nigeria. It was also an objective to

consider the prospects of marketing these non – oil export products of

Nigeria. At the end recommendations will be made. This data used in

this study was obtained through both primary and secondary sources.

This primary sources of data included the use of questionnaires

and those obtained through oral interview of stakeholders while the

secondary sources includes textbooks, articles, internet and journals as

well as other unpublished materials. The problems found out in the

course of the research include the fact that Nigeria’s exports are made

up of 8 percent manufactured good and 92 percent primary production,

non competitiveness of export products, ineffective implementation of

export incentives, pricing as well as marketing problem.

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Four hypothesis were formulated and tested. The first hypothesis

sought to find out the effectiveness of export intensives available to

exporters, the second sought to determine the effect of product quality

on their marketing. The third hypothesis tested the effect or high

production cost on international competitiveness of Nigeria export

products. The fourth hypothesis tested the availability of market

information of Nigeria exporters. The instrument of data collection and

analysis used is the chi – square method where the decision rule was

applied. The analysis of data and the findings formed the basis of

conclusions arrived at the recommendations made.

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TABLE OF CONTENTS

Content

Title

Certification

Dedication

Acknowledgement

Abstract

Table of contents

CHAPTER ONE

1.1 Introduction

1.2 Statement of Problems

1.3 Objectives of Study

1.4 Research Methodology

1.5 Hypothesis

1.6 Significant of Study

1.7 Limitations and Scope

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CHAPTER TWO REVIEW OF RELATED LITERATURE

2.1 Introduction

2.2 History of Nigeria Exports

2.3 National and Global Communication Trade

2.4 Government Intervention in Nigeria Commodity Trade

2.6 Export Promotion in Nigeria

2.7 Constraints on Export Growth in Nigeria

2.8 General Problem of Non oil Export Sector

CHAPTER THREE: RESEARCH METHODOLOGY

3.1 sources of Data

3.2 Primary Data

3.3 Secondary Data

3.4 Sampling Plan

3.5 Strengths and Weakness

3.6 Sampling Size Determination

3.7 Sample Technique

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3.8 Data Collection and Processing

CHAPTER FOUR: DATE PRESENTATION AND ANALYSIS

4.1 Data Presentation

4.2 Questionnaire Distribution and rate of response

CHAPTER FIVE: SUMMARY OF FINDINGS, CONCLUSIONS AND

RECOMMENDTAIONS

5.1 Summary of findings

5.2 conclusions

5.3 Recommendations

Bibliography

Appendices

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CHAPTER ONE

1.1 INTRODUCTION

Historically, Nigeria has operated a dual economy where modern

segment, is heartily dependent on crude oil earnings dominates a

traditional agriculture and trading segment.

At independence, agriculture accounted for well over 50 percent of

gross Domestic Products (GDP) and was the source of export earning

and public revenue with agriculture marketing boards playing a leading

role.

Prior to Nigeria’s independence in 1960, cash crops were

introduced, harbors, railways and roads were developed and a market

for consumer’s goods began to emerge. For almost three decades now,

oil has emerged as a heading variable in the national economic science.

Its dominance and over – whelming importance has left Nigeria

operating a mono – economy with oil accounting for more than 78

percent of federal government revenue, more than 95 percent of export

earnings, and about 11 percent of GDP at factor cost. Agriculture

(including livestock, forestry and fishing) is still the principal activity of the

majority of Nigeria, constituting about 40 percent of GDP.

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By 1979, the country’s sales of petroleum product had fallen

drastically, mainly due to the actions of united states and her

collaborators after the Arab-Isiaeli war. It was in light of the falling of oil

price that federal government of Nigeria embarked on non-oil export

promotion to boost its foreign exchange earning. That it did by

establishing the Nigeria export promotion council (NEPC). Since 1986,

the Nigeria has taken a number of steps and initiated various policies to

promote non-oil export expansion under the rubric of structural

adjustment programme (SAP). The objectives of SAP was to stabilize

the economy and remove distortion in economic incentives by changes

in trade and exchange regime, decontrol of prices, and marketing

arrangement for goods and services. Among other things, these reforms

are also expected to alter and re-align aggregate domestic expenditure

and production patterns so as to minimize dependence on imports and

on oil exports, and above all to enhance the non-oil export base.

Seven years of implementing the economic reforms under the well-

intended SAP of 1986-1993 left the economy prostate, while the next

half-decade (1994-1999) witnessed an unprecedented corruption and

international isolation which further crippled the economy. Unfortunately,

after 7 years under a democratic experiment, the economy is still

groaning under the strains of those past events. The government and

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people of Nigeria have always acknowledged that Nigeria products are

not doing well in the international market but nothing concrete has been

done to reverse this tread.

In a recent study by the Bank, it was contended that in most of

developing countries that have successfully grown through export

promotion, tier trade policies have included substantial protection of local

manufactures. In addition, government have taken some steps to offset

some disadvantages of protection by actively supporting exports.

Interventions to support specific industries have generally not been

successful.

The export push strategy; a mix of fundamental and interventionist

policies used to encourage rapid manufactured export growth has

resulted in numerous benefits which includes more efficient allocation of

resources; increased acquisition of foreign technology and rapid

productivity growth.

The problem hinged mainly on the neglect of non-oil sector,

Nigeria’s wealth due to oil boom was only a euphoria, which quickly went

as it came. Perhaps, this has made some authors like Ejiofor

(1980:23)to argue that oil boom blessing .

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Starting from 1985 till now, policy makes realized that a major

effort to diversify the sources of foreign exchange and reduce the

dependence on crude oil export was imperative. The industrialization

strategy had to correct the significant of anti-export bias that existed,

achieve a more mental trade incentive regime and perhaps a pro-export

bias. This policies came as a result of these:

a. First, Nigeria had virtually exhausted the possibility of

industrial growth through import- substitution, which could be

maintained if the foreign exchange to import cheap capital

and intermediate goods could be obtained through

expanding primary commodity exports do not appear bright

in an import-substitution environment coupled with the poor

global prospects for these commodities.

b. Second, policy makers see export see export potential in

transforming Nigeria’s abundant gas and oil reserved into

exportable processed and semi-processed goods.

c. Third, they felt there was need to find a stable alternative

means of generating foreign exchange to ease the

tremendous debt burden and balance of payment difficulties.

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Some of the major constraints to export growth especially in the

1970’s have been the inadequate infrastructural support (particularly in

the field of freight, transport, product developing and quality control)

absence of product specific marketing strategies and promotional

programmes; administrative delays, cumbersome export document and

procedures. Non-oil export growth, despite a marked improvement in the

last few years, it has not been sufficient to offset the increasingly

unfavourable balance of trade.

Despite these limitations, the export sector has succeeded in

establishing a consolidated base with a range of established products

with growth potential. It has also a fair range of new products which can

be developed to produce substantial export capacity, which could be as

a result of active marketing promotion. It has a reasonably developed

industrial base supported by a fairly experienced management and

labour force whose technical infrastructure and banking and commercial

services, are gradually queuing themselves to meet the increasing

needs of non-oil export sector.

With this background and government policies and programmes to

support export development during the period of structural adjustment

programme, the export sector has the potential of becoming major

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catalyst for economic development once adequate attention is paid to so

as to sustain its growth.

Historically, a number of export strategies and polices have been

implemented with no definite promising results. The traditional

agricultural export policies during the first phase were suited for the level

of development the country had planned.

It absorbed more labour, and required high levels of productivity

for the local farmers. The export monoculture policy of the 1970’s in

which oil was the predominant good, had proved not only risky and

variable in its payoffs but had exposed the economy precariously to

adverse external economic and trade policies most of the problems

Nigeria faced while trying to promote non-oil exports will centre on

competition. At present, the export industries set up in Nigeria produce

the traditional consumer goods: for example, cotton, footwear, textiles,

soft drinks, beer, cement and rubber etc. The chances of security any

significant breakthrough in these lines are very remote. This is because

Nigeria, being a late starter, will find it difficult to complete with similar

products made by such developed countries as the United States, the

United Kingdom and Japan. However, within the framework of the SAP

the vigorous promotion of non-oil exports has been one of the major

economic activities embanked upon by the Babangida administration to

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receive the ailing Nigeria economy. One of the non-oil export

promotional devices has been the massive devaluation of the naira in

the foreign currency and thus boost the quantum and value of non-oil

export. Earlier in the 1986, budget package of export incentives were

later embodied in the export (incentives and miscellaneous provision)

Decree No 18 of July 1986.

The domestic marked manufactures is large, but the capacity

utilization is low in Nigeria. As a result, the inability of certain industries

to produce demand will tend to exclude these manufacturing industries

from engaging in export business. through some government incentives

like the recent availability of credit insurance that protects exporters

again risk: and through the operations of the Nigeria exports promotion

council (NEPC) the development of exports of certain goods can now

be feasible.

1.2 STATEMENT OF PROBLEM

The basic problem of this study is to evaluate the problems of non-

oil export products of Nigeria. Some of these problem are:

1. The problem of low production and high production cost

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2. The export incentives provides to the exporters are not

properly administered and the therefore not effective.

3. Low quality of manufactured goods in the country as a result

of this, do not melt international.

4. Reduced levels of new investments in discovered deposits.

5. Obsolete equipment which are used in production,.

6. Wrong pricing of agricultural export products

1.3 OBJECTIVES OF THE STUDY

The basic objective of this study is to evaluate the performance of

non-oil export sector in Nigeria with a view of identifying the factors

responsible for its poor performance. These includes:-

1. To explore the extent to which low level as well high cost of

production affected the marketing of non-oil export products.

2. To examine the volume of market information available to the

exporter.

3. To examine the general quality of manufactured export

products from Nigeria.

4. To examine the affect of Obsolete equipment in the

production and exportation of non-oil export product.

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5. Reduced levels of now investments in discovered deposit.

6. To examine the effectiveness of export incentives provided

to the exporter.

7. To determine the effect of inappropriate pricing of agricultural

exports products.

1.4 RESEARCH METHODOLOGY

The data for the analysis were obtained from primary and

secondary sources.

The approach employed in this study to analyze the data obtained

from field work is the use of chi-square test of statistic while the desk

analysis relied more on the secondary data, deductions from the primary

data were used to corroborate and rationalize some of the results of the

desk analysis.

1.5 HYPOTHESIS

1. Ho: There is not enough information available to exporters

about the existence of markets for their products.

H1: There is enough information available to exporters

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about the existence of markets for the products.

2. Ho: high cost of production does not affect the international

competitiveness of Nigeria’s export products.

H1: High cost of production affects the international

competitiveness of Nigerian’s export products.

3. Ho: The export incentive are not effective in the marketing

of non-oil export products.

Ho: The export incentives are effective in the marketing of

non-oil export products.

4. Ho: Low quality of Nigerian export does not affect its export

marketing performance.

H1: Low quality of Nigeria exports affect its export marketing

performance.

5. Ho: Reduced levels of new investment in discovered

mineral deposits does not affect their marketing.

H1: Recued level of new investment in discovered mineral

deposits affects their marketing.

6. Ho: Inappropriate pricing of agricultural export products

does not affect the international market performance.

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H1: Inappropriate pricing of agricultural export products

affects their international market performance .

1.6 SIGNIFICANT OF THE STUDY

1. Formulate and implement effective strategies to bolster

prospects of marketing non-oil export products of Nigeria.

2. To adopt and implement more effective incentive schemes to

motivate exporters to attain higher export whines.

3. To reform and strengthen the roles of export facilitating

agencies.

4. To engender macroeconomic stability and to create enabling

investment climate

1.7 LIMITATIONS AND SCOPE

Exports in Nigeria are composed of oil and non-oil products. Oil

export is mainly crude petroleum while non-oil exports include agriculture

and forestry products, minerals, manufactured good, liquefied natural

gas, condensate and other visible and non visible services. for the

purpose of this study non-oil exports refer to agricultures, foresting

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products and minerals, which includes cocoa. Groundnut oil, palm

produce (palm kernel and oil), Natural rubber, Hides and skin, Wood,

Fishes, Cotton, Rubber, timber, logs, plywood, tin etc. while

manufactured products such as: Textile, Chemical, Motor vehicle

/machinery, Soap/detergent, Beer/Beverages, Urea, Processed skin

other manufactured exports.

As expected of any applied research, finance was also a

constraints as it limited the researcher in his search for data.

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CHAPTER TWO

REVIEW OF RELATED LITERATURE

2.1 INTRODUCTION

The popularity of marketing in all aspects of business has grown

significantly over the years. Marketing today, is no longer seen as a

department of a business. For instance, Drucker (1968) defines

marketing as an embodiment of the entire business. this definition is

explained by Hanson (1979:28) as the whole business seen from the

customers point of view.

Marketing is the all important set of creative human activities

aimed at identifying, anticipating and satisfying needs or wants through

exchange as efficiently and effectively as possible (Adirika 1930:3) this is

prominent in all the definitions of marketing that have over the years

evolved that is the marketing centers on customers satisfaction. From

this point scholars of marketing became aware of the divergent views on

whether an organization should put its goal and objectives first before

customers satisfaction or the other way round. Kir Palami (1987:469)

stated that international market can be divided into form segment,

namely:

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1. The industrial countries Book and Remer (1977,33) defined

international marketing as a process by which any firm

performs its marketing operations, either import or export, or

provision of services in at least two countries. Nwokoye

(1980: 235) defined it as any form of marketing conducted

across national boundaries. Export marketing has its peculiar

problems distinct from general problems of market. These

problems have to do with the target market, the mode of

payment, the tastes and culture of the consumers, the form

of those goods, affordability coupled with the decision to buy

and the provision cost. Star et al (1977, p.5) established that

that primary objectives of the marketing process is to satisfy

the consumers need and wants through the development

and implementation of sound profitable marketing

programmes. These marketing programmes are subsumed

in the overall objective of the firm. An analysis of the

marketing problems that confront firms are traceable to the

marketing mix of 4ps + 1, which is product, price, place,

promotion and information. McCarthy (1968,31).

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Non-oil export marketing as the focus here is the planning and

execution of all those marketing activities necessary to satisfy the needs

and wants of Nigeria’s non oil products in the international market.

WORD (185, P. 15) stated that prospecting and exporting involves

a lot money that goes into financing activities. To decide where market

development efforts will pay off the most, exporters should

systematically narrow down their targets.

2.2 HISTORY OF NIGERIA’S EXPORTS

Export development in post-independence Nigeria can be divided

into three phases. The first phase lasted till the end of the civil war in

1970 and was characterized by agricultural production. The second

phase includes the years 1971 through 1984, and was marked by a

dominance of cruse oil production and exportation. The third phase that

started in 1985 was marked by a transition to an export oriented

industrial strategy with priority given to the development of non-oil

commodities. In the periods the export-oriented strategy becomes

institutionalized, and rapid economic growth pursed.

Most of the civil war was fought in the palm belt, which disrupted

the production and export trend. The end of the war marked the

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beginning of the second phase. This was a boom period partly due to a

restoration of oil production and increased reconstruction activity during

which labor drifted from the agricultural sector to the industrial and

construction sectors where the wage rate was comparatively higher.

2.3 NATIONAL AND GLOBAL COMMODITY TRADE

Agricultural exports accounted for much of Nigeria’s non-oil

exports as at 1986, thus, the expansion in non-oil revenue is significantly

hinged on expansion in agricultural exports. The belief that the private

sector is more efficient than government underlines the preference of

Breton woods school for deregulation or liberalization policies.

The concept of a pure free market global economy assumes that

all production, investment, savings, exchange and consumption within

and between all actions are conducted in perfectly competitive market.

International commodity (agricultural product) trade in the real

world is organized under the international commodity agreements (ICAS)

thus, international trade in cocoa, natural rubber and palm kernels,

which are Nigeria’s major non-oil tradable are organized by their

respective (ICAS). It’s important to note that the commodity exporting

countries, commodity-consuming countries, UNCTAD and the IMF were

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principal actors in the formulation of an international approach to

commodity problems in the 1970’s. According to UNCTAD (1974) some

of the issues in approach to commodity problems are:

i. Establishment of international stocks to ensure that

excessive movements in prices can be prevented by market

intervention.

ii. The creation of a common fund for the financing of

international stocks

iii. The building up of systems of multi lateral into purchase and

supply commitments as a means of improving the

predictability of resources in commodity production.

iv. Improved compensatory agreements when market

intervention fail to support prices and earnings.

v. Implementations of counter-protective measures against

restrictions on processed exports.

vi. Expansion of processing and diversification.

The foregoing shows that international commodity exchange does

not take place in free markets but in more or less bilateral oligopoly

market. Consequently, strategic bargaining is the key determinant of

pay-offs (prices, quantities and revenue) in the market. Given that

producers and commodities have conflicting objectives, the dynamic

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game seems to be a zero sum game, therefore, if supply outruns

demand in long term, consuming nations would be better placed to

improve their payoffs over the long run at the expense of commodity

exporters. This would lead to lower commodity prices and hence, lower

income for exporters in the long term. Moreover, if supply persistently

outruns demand, commodity exporters would find of difficulty to bargain

collectively because consuming nations being more developed than

commodity exporters that they also control the Breton woods institutions.

Thus, the more strategically placed consumers could easily break the

ranks of commodity exporters through preferential trade treatments and

rank-breaking incentives. In this scenario, increase in global supply

when supply outruns demand is not in the long-term interests of

commodity exporting nations or their farmers.

2.4 GOVERNMENT INTERVENTION IN NIGERIA COMMODITY

TRADE

Government intervene in Nigeria agricultural dates back to 1942

when the colonial administration established the west African produce

marketing board, which took over the responsibilities for purchases of

cocoa, palm oil, and oil seeds (Akintomide, 1974) At the onset, the

production and the trade in agricultural tradable sought primary to satisfy

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the interest of Britain and not the interest of Nigeria farmers, consumers

or the economy respectively.

According to Akiutomide (1974), post independence marketing

boards sought to:

i. Raise the bargaining power of producers on the domestic and

international markets given that produce farmers are small with

little or no experience relative to the concentrated and organized

demand they face.

ii. Improve the marketing of agricultural products and ensure high

grade produce.

iii. Provide reserve funds to shelter producers against price

fluctuations.

iv. Collect funds for research, extension works and for the

development of the agricultural industry.

v. Provides information about production and trade.

vi. Provide control of export commodities on which Nigeria depended

for export revenue.

vii. Act as executive agency for government.

It is apparent that existence of the multiple objectives of marketing

boards at independence are linked to the historical circumstance of

Nigeria and key desire at independence was developed. Abbot (1971)

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supports trade regulations on the ground that an organized procedure

can facilitate technological change by helping to raise the living standard

of the operators as well as providing them with the financial resources

for additional investment s and expansion of their activities.

According to Helleiner (1966) marketing boards have and

continued to be an extremely effective instrument for the mobilization of

savings for government sponsored economic development.

However, before independence, according to Olakanpo and Feriba

(1974) marketing boards activities and the surplus they generated, were

geared to strengthening the finances of Britain. Thus, the expanded and

revised mandate of the marketing boards sought to redress the

exploitation of farmers and Nigeria by Britain. However Ogunsheye

(1966) argues that stabilization of produce prices by marketing boards

caused farmers incomes to be unstable. Similarly, Olatundosun and

Olayide (1974) suggest that over the period 1948 – 1967 producers of

Cocoa, Palm oil, Palm kernel, and Groundnut received less than the

world prices for their produce.

The debate on the relevance of marketing boards dates back to

the period after their introduction in 1927 in Canada and Austrilia. The

call for the abolition of Nigeria marketing Boards on the ground that they

29

exploit Nigerian farmers became strong after Nigeria’s independence

(onitin and olatubosun, 1974). This is various given that.

a) Agriculture was supposed to be an engine of growth in the

Nigerian economy by generating surplus for development .

b) The exploitation of producers of the export products by their

foreign customers (Aluko, 1974).

c) The marketing boards predated independence by about 20

years during which they generated trading surplus.

d) The surplus hitherto, used to strengthen British finances,

were after independence used for development projects.

An international conference held at the University of Ibadan from

29 March to April 3, 1971 arrived at the following conclusions.

i) Organized marketing of export crops particularly for the

stabilization of producer prices is indispensable especially in

those areas where production is concentrated in the hands of

small farmers.

ii) Effective extension and rehabilitation programmes are as

important as produces prices to output expansion.

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iii) A balance should be struck between long – term

development objectives of stabilization of producer prices

and incomes.

All of these suggest a reform, rather than the dissolution of

marketing boards. However, the call for reform in 1971 gave way to

strong arguments for dissolution in the early parts of the 1980s.

2.5 THE NATIONAL AND INTERNATIONAL COMMODITY

PROBLEMS.

International commodity agreement are intended to stabilize prices

for an particular commodities by determining world output levels and

assigning quotas to particular countries. They are similar in conception

to cartel OPEC. There is some experience for example in sugar, wheat

etc.

If they are to work, they require cooperation and compromise, they

also require the existence of a policeman to ensure that members abide

by the rules.

Lipsey (1966) identifies an agricultural problems as one of the most

perplexing problems facing policy makers in western countries. He

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highlights four issues at the heart of the agricultural problem and they

are.

i) In many western countries, the average income of farmers

was significantly lower than the other sectors. For example

while agriculture employed 3.5 percent of Britons, the

workers earn only 2.5% of the total British income.

ii) Agricultural supplies show a tendency to outrun demand with

the result that, free market prices tend to be depressed to the

disadvantage of farmers.

iii) Agricultural output tend to be unstable arising from its

dependence on natural factors such as weather (rainfall,

humidity, temperature etc) disease and pests and natural

disasters (such as typhoons, floods, and earthquakes) which

are inherently unstable. This agricultural output are

unplanned with periods of good and poor harvest.

iv) Intervention leads to increase in output and unsold

agricultural surplus.

Productivity growth in the agricultural sector would not be in the

best interest of the commodity exploiting countries of farmers if it causes

supply to persistently outrun demand. This is very likely, if income

32

elasticity of demand for agricultural products are lower than their supply

elasticity and there is no form of market intervention.

The resulting excess demand in a free market on agriculture.

Decline in returns relative to higher returns in high income – elastic

sectors world in turn, lead to a decline in investment of agriculture.

Consequently, the agricultural sector would decline. This chain reaction

led lipsey (1966: P.150) to predict that in a free market society, the

mechanism for a continued reallocation of resources out of low-elasticity

industries into high-elasticity ones is a continued depressed tendency on

prices and incomes in contracting industries and a continuous tendency

on prices and incomes in expanding countries.

The World Bank (1982) Reported notes that overvaluation of the

Naira necessarily places Nigerian products at a significant cost

disadvantage relative to foreign goods market. This suggests that

Nigeria’s exchange rate policy was the key constraints to exports of

industrial products. Though Nigerian statistics show an insignificant level

of manufactured export, the World Bank (1982) report indicates that

illegal exports of some magnitude are known to exist in a particular case

of glass containers (bottles) aluminum extrusions, detergents and soap,

textiles. However, this is written a strong or conclusive evidence of

Nigerian capacity in the exports of manufactured goods.

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For Africa to reserve its unfavourable export trends the region

must adopt appropriate trade and structural adjustment policies in order

to enhance its political and policy uncertainty, a high risk environment

and inadequate government commitment to reforms as the key factors in

Africa’s marginalized world trade. Civil wars, export taxes, smuggling

and false invoicing here negative effectives on trade performance.

AN OVERVIEW OF NON-OIL EXPORT PROMOTION POLICIES

It would be useful to specify clearly the key instruments of the post

1986 non-oil policy. What least, five decrees were promulgated between

1986 and 1988 as means of promoting non-oil exports in Nigeria. All the

decrees sought to improve price and non-price incentive to exporters of

non-oil products. In 1986, the three key decrees were promulgated as

follows:

i. Export (incentives and miscellaneous provision) Decree 18.

ii. Second

iii. Customs and Excise etc miscellaneous provision Decree No.

37.

Similarly, in 1988 two decree were promulgated, which are:

i. The Nigerian Export promotion Decree No 41.

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ii. Export Credit Guarantee and Insurances Scheme Decree

No. 13.

The SFEM Decree was targeted on non-oil export prices through

exchange late depreciation. Thus, the action system introduced in

September 1986, led to the depreciation of Naira against the convertible

currencies of Nigeria’s Major trading partners its dollars; British Pound;

Japanese Yen, Dutch Guilder, and so on. Most of the inputs used in

manufacturing are imported. The depreciation of naira rather made

imports costly while farmers were not producing enough to meet

demand.

The customs and excise etc miscellaneous provision decree

among others abolished export license for prohibited products on those

subjected to special restrictions. It also exampled non-oil products from

duties. Thus, removing theoretical tax on non-oil exports, which the

Breton woods school believed to be a cause of decrease in level of

Nigerians non-oil exports. In addition, it allowed non-oil export to retain

100% of export proceeds, which could be lodged indomicillary accounts

that could be opened for such purpose in Nigerian Banks.

To further deregulate the domestic mechanism for non-oil trade,

commodity boards which hitherto before (1986) organized the domestic

trade of agricultural tradable and also undertook their exportation were

35

scrapped ostensibly to allow farmers and private exporters of agricultural

tradable goods, a direct access to the international market so that they

could derive the full advantages and disadvantage of international trade.

The apart (incentives and miscellaneous provisions) Decree provided

for:

i. Tax free interest earned on export loans

ii. Currency retention scheme of 25% later 100% in

consonance with SFEM (Decree No. 18) for non-oil

exporters.

iii. A development found, that is the Export Development Fund

(EDF) to provide direct financial assistance to non-oil

exporters to meet part of their expenses in promoting their

products in the international Market.

iv. A duty drawback suspension scheme which exempts export

industries from import duties and excise duties.

v. The establishment of an Export Expansion Fund (EEF) to

provide cash grants to exporters of semi-manufacturers and

manufacturers to enable them increase their export.

vi. Higher capital tax depreciation allowance for manufactured

exports. Even though all these incentive were put in place

export volumes still remained low.

36

The Nigerian Export Promotion Council (NEPC) decree

established the NEPC and charged it with the responsibility of

spearheading the export promotion drive. The decree also

provided for the creation of three Zonal Offices in Lagos, Kano and

Port-Harcourt and the creation of Form Commercial Desks in

London, New York, Abidjan and Jeddah. These international

commercial desks are expected to promote the export of made in

Nigeria goods to the various sub-regions. NEPC again suffered the

normal government bureaucracy. It depended on government for

virturally everything. The council was not set up to recover some of

its cost. There were delays in releasing funds meant for carrying

out export related activities.

The Export Credit Guarantee and Insurance Scheme Decree

provided for the establishment of an Export Credit Guarantee and

Insurance Corporation under the provision of the CBN. The corporation

was to:

1. Issue guarantee to banks for pre-shipment financing required

by exporters to enable them produce to meet export orders.

2. Provide post-shipment export financial for exporters to

enable them extend credit facilities of foreign importers of

Nigerian products.

37

3. Provide foreign exchange revolving loans to exporters in

order to import raw materials and spare parts required to

specific export production.

It is not possible in this study to evaluate precisely and in detail the

extend to which the provision of the decrees have been implemented.

However, the value of the Naira in relation to the dollar has depreciated

persistently since 1986. In addition, the commodity boards have been

abolished since 1986 white non-oil export products are largely, no longer

subjected to quantitative or tariff restriction. It could therefore, be inferred

that the Major sources of disincentives according to the Breton woods

school exchange rate overvaluation, the commodity board quantitative

and tariff restriction on non-oil exports have since 1986 been removed. If

the underlying premises of reform policies are valid, then the trade

liberalization should generate positive and significant response from

non-oil exports.

Export promotion strategy is essentially a trade strategy, which

encourages production for exports and in which them is an embedded

bias for exports rather than import-substitutes. Whatever the incentive

exist must favour production for exports as much as production for the

domestic market. It major feature of export promotion strategies that they

provide at least as much incentives to earn as well as to save foreign

38

exchange. Export promotion strategy is invariably accompanied by

incentives to domestic manufactures and companies producing for

exports. The incentive thus, provided may be fairly uniform and may

sometimes be discriminatory across commodity groups. Depending on

the immediate objectives of the country involved. Other features of the

export promotion and incentives strategy includes:

• Ready access to imports of intermediate and capital goods to

exporters.

• Fairly realistic exchange rates

• Avoidance of quantitative restrictions

• Use of tariffs with relatively simple procedures to permit

exporters access to the international market at international

prices for their inputs.

In addition, export promotion drive has the tendency to reduce

dependence on the third country in the sense that foreign exchange

earnings grow rapidly, market become increasingly diverse and the

economy increasingly flexible.

BENEFITS OF EXPORT PROMOTION

Economists have measured the gains form an outward-oriented

strategy in terms of the usual classical gains form trade and a number of

39

dynamic considerations. They believe that export promotion strategy is

superior to the strategy of import substitution. Properly programmed and

implemented, an export promotion strategy can enable a country to

realize the benefits of international specialization consequent to relative

and comparative advantage present in the country. It can also provide a

stimulus to efficiency as a result of exposure to foreign competition and

technology and a prospect of worldwide market for products. Indeed, if a

country can export to the world market, it can enjoy considerable

economics of scale. Local industries would also reap the benefits of

internal economics of scale that could not have been achieved by

providing for only the limited home market. furthermore, the domestic

resources cost of earning a unit of foreign ends to be less than the

domestic resource cost saving a unit of foreign exchange. The value of

exports that could be produced with a given unit of scare factors would

be grater than the value of imports that could be replaced. In addition, a

pre-trade strategy is likely to attract foreign direct investment Export

promotion also contributes more than import substitution to be objectives

of greater foreign income. Being labour intensive in production technique

and dependent on the demand of a worldwide market, the non-traditional

exports may absorb more labour than import replacement. They may

also reduce the cost of employment in terms of the complementary use

of scare factors of capital and imported inputs.

40

2.6 EXPORT PROMOTION IN NIGERIA.

Export Promotion and the Structural Adjustment Programme

(SAP).

A Major attempt at promoting exports in Nigeria came with the

Structural Adjustment Programme (SAP) of SAP decree of 1986. The

era witnessed the introduction of new export policies and incentives. The

thrust of the programme was to achieved by the end of 1990, about $1

billion in earnings from non-oil exports of goods and service.

Consequently, export promotion was pursued within the framework of

trade liberalization and supported by the naira exchange rate

depreciation and generous export incentive. The immediate

consequence of the devaluation of the naira brought about very high

naira prices in agricultural commodities, even though the foreign

currency value remained uncharged. For example, a metric tone of

graded coca, which sold for 1,500 in 1984/85 before the advent of

Second-Tier Foreign Exchange Market (SFEM) sold for 7,500 and

11,000 in 1987/88 and 1988/89, respectively. The prices of cotton

similarly rose substantially from 850 per tone in 1985/86 to 4,500 in

1988/89. The result of the high naira prices of agricultural produce

coupled with the abolition of commodity Boards produced positive

41

impact on the desire to export goods, but since most of these goods are

primary commodities, the supply was unable to adjust to the new desire.

The euphoria also led to the emergence of exporters who were non-

indigenes and their main aim was not the development of Nigeria’s non-

oil export but that of repatriation of capital from the country.

However, the policy focus failed to adequately take cognizance of

the existing structure of production, which reflects inadequate production

of exportable surplus that can quickly take advantage to changes in

relative international prices. Furthermore, no account was taken of the

raw materials needs of domestic industries even where it was clear that

the supplies of such raw materials could not be increased in the short

run. The effect of this led to shortages of locally produced raw materials

for domestic processing of manufactured industries. One of the

industries most affected is the cocoa processing industries. In addition,

the policy failed to realize that most of the country’s current

manufacturing outfit grew out of the policy of import. Substitution and

they are, therefore, not geared for export promotion. Hence, the desire

to export manufactured goods where this would lead to shortages at

home was not fulfilled.

Where manufacturing industries had accumulated industries and

should therefore promote the export of such goods, these inventories do

42

not simply reflect exportable surplus but he weak purchasing power

occasioned by harsh economic conditions created for consumes by

Structural/Adjusted Programme.

EXPORT PROMOTION POLICIES AND STRATEGIES

Before Nigeria became independent some measures aimed at

coordinating export activities of the country to meet the demand of the

overseas. Consumer had been introduced by the then colonial masters,

the British Government. Nigerian exports were mainly raw materials

used in the industries of the metropolitan countries. The most prominent

among such measures was the establishment of market boards for

commodities. In 19467, the Nigeria Produce Marketing Company

(NPMC) was established to serve as the overseas selling agent for the

from main commodity boards, in the country at that time. The objective

of NPMC was the coordinate, ensures a steady supply of raw materials

(cocoa groundnuts, rubber and palm produce) to the British market and

ensures that British did not have any rival for such produce among the

other European Countries. In the post-independence era, and even up

till date, the institutions were either merely restructured or have retailed

the earlier structures with their objectives remaining almost the same.

The marketing boards arrangement was subsequently abolished and

43

substituted with trade liberalization policy, an important element of the

Structural/Adjustment Programme (SAP).

Since the country opted for economic reforms, the need to

diversify the export base and switch from previously existing import

substitution policy to export oriented growth strategy, has necessitated

the adoption of a number of policy measure that seek, not only boost

export earnings, but also to take advantage of the other numerous

benefits of export trade.

ii. PROVISION OF EXPORT AND INSURANCE FACILITIES

Until very recently, very few countries in the sub-region had any

specialized financial institutions to oversee the financial aspect of export

promotion. Export-import banks selected banks or in some cases, the

Central Bank, were the main platforms for providing loans for export

financing activities of the marketing boards. In Nigeria, the Central Bank

of Nigeria was statutorily empowered to undertake direct financing to

produce marketing in Nigeria. However, with the abolition of marketing

boards and the establishment of the NEXIM Bank, private exporters

were expected to seek financial assistance for their export activities

form the newly established bank. NEXIM was established by Decree 38

of 1991, to provide finance, risk mitigating fatalities, trade information as

well as advisory services in support of export to the Nigerian export-

44

import community. The credit facilities include rediscounting and

refinancing facility (RRF) input facility (FIF) and stocking facility (SF).

The RRF is a short-term trade finance facility designed to support the

marketing of export commodities while the FIF is a medium term project

finance facility developed to support value-added productive activate is

through the provision of foreign exchange facility for the procurement of

essential foreign input. The SF, another short-term facility is meant to

assist manufacturing export to stock sufficient quantities of seasonal

local raw materials in order to keep their operational option level.

11. FISCAL FINANCIAL INCENTIVES

Nigeria has made extensive use of fiscal and financial incentives to

encourage both local and foreign investors to produce for export,

particularly since the adoption of the structural adjustment programme.

These incentives include:

a. Foreign Exchange Retention Scheme: Under this

arrangement exports are allowed to retain a certain

percentage of export proceeds in foreign currency for use in

any eligible transaction. In Nigeria, unit January 1994,

exporters were allowed to keep 100 percent of export

proceeds in their domiciliary accounts.

45

b. Deductive/Waiver of Duty Imported Input and Export:

Incentives ranging from low duty drawback schemes were

adopted to minimize the cost of production of goods meant

for export. In Nigeria, duty drawback schemes have been put

in place whereby the duty paid on imported input for export

activities are refundable.

c. Pioneer Status/Tax Incentives: In order to encourage

production for export especially of non-traditional

manufactured goods, tax incentives and pioneer status due

granted producers for exports.

d. Export Expansion Grant/Export Adjustment Scheme: In

Nigeria, Export Expansion grants are awarded for exporters

who export a minimum of 500,000 worth of goods while

subsidies are provided for products with high cost of

production in order to make the price of the product more

competitive. In some countries exporters who increase their

earnings form year to year could be granted bonus foreign

exchange allocation equivalent to 30 percent of the increase

in their exports.

e. Capital Assets Depreciation Allocation/Tax Relief on

Interest Income: In Nigeria, a grant of 5 percent additional

annual depreciation allowance on plant and machinery is

46

given to any exporter who exports at last 50 of its annual

turnover, while tax relief on interest income accruing to

banks from loans granted for export operations is given to

such banks. Other financial incentives are; foreign input

facility, credit guarantee facility, credit insurance facility,

currency retention scheme, export development find, duty

drawback scheme, duty suspension scheme, pioneer status,

tax relief on interest incomes, export price adjustment

scheme, export liberalization measures, buy-back

arrangement, export processing zones.

2.7 CONSTRAINTS OF EXPORT GROWTH

a. Existing tradable goods and poor performance of traditional

exports Nigeria relies on a few traditional exports, mainly

agricultural produce and minerals, apart from crude

petroleum, which the country started to export in 1988. In the

whole of sub-Sharan African, it is only in about seven

countries that the share of top two product exports

accounted for less than 50 percent of total export value in

47

1988. In most others, the share of the two top export of

products, which are mainly primary produce or minerals,

average, 80 percent of total export, related to this is the

downward trend noticed in some traditional exports,

reflecting either the growing domestic demand for the

product or unfavoruable domestic policy. For example, from

1973-1975 and 1985 – 1987, the average yearly volume of

coffee exports feel by 18 percent while exports of palm oil

and timber fell by 28 and 35 percent respectively. Among

minerals, export of copper and phosphate fell by 14 percent

each. Factors such as over-valuation of domestic currencies,

which makes export less competitive, sharp declines in real

producer prices, and natural disasters, such was drought,

have contributed to the poor export performance of many of

these countries. In Nigeria, groundnuts wand palm produce

have virtually disappeared from the export list.

b. Constraints of Agricultural and Mineral Export: The problem

affecting agricultural production include high cost and

scarcity of farm labour inadequate and irregular supply of

inputs, inadequate extension services and transportation,

absence of basic infrastructures, rigidities in the production

48

process, inadequate financing, and low income elasticity of

agricultural products. All these have discouraged production

and therefore, resulted in lowest production of agricultural

produce respectively.

African manufactures are presented with two strategies

dictated by market requirements.

1. To produce high volumes of consistent quality cost

2. To produce low volumes for high – income retailers.

Long-term competitiveness depends on a producer’s

ability to achieve a balance in terms of the cost,

quality, output, and design capabilities required by

retailers. The following difficulties are encountered in

meeting a high-volume strategy.

• Mismatch in scale and technical competence of

African exporters

• In ability of exporters to negotiate a realistic

price.

• Lack of information about financial institutions

and instruments in international trade.

• Differences in the business culture

• Inexperienced intermediaries.

49

The greatest impediments in growth of non-oil export products

sector are the difficulty in organizing many remote small producers, the

need to provide working capital. The macroeconomic environment in

many African countries has to be reformed. Most potential exporters in

sub-Saharan African are unprepared for the demanding and highly

discriminatory nature of the agricultural market.

several study reports have attempted to identify the problems and

constraint of the manufacturing sector. Recently macroeconomic

administrator have taken keen interest in the health of the real sector.

Some of the factors identified includes low factor productivity growth,

poor industrial policy formulation, excess capacity, high production costs,

imported-input intensive processes, real exchange rate misalignments

and other forms of distortions that the government was reacting to the

illusion that the economics structural program was to have ameliorated

the imbalances in the system within even the shorter period of fifteen

months that they had forecast for its implementation.

Other constraints on manufacturers include inadequate export

incentives, such as export financing facilities, inadequate information

about export potential and lack of initiatives on the part of potential

exporters. When the need to reverse the policy option became obvious,

many of these countries found it difficult to restructure and re-orientate

50

the existing import substituting industries to produce for export.

Moreover, many of the industries are subsidiaries to the parent

companies abroad and are naturally expected to cater for local demand

and compete with parent bodies in other market.

2.8 GENERAL PROBLEMS OF NON-OIL EXPORT SECTOR

a. Inadequate and decaying infrastructures

b. Funding/financing constraints

c. Inefficient implementation of export incentives and support

programmes

d. Inadequate funding

The inadequacy of funding both in Nigeria and foreign currency to

meet the challenges of an expanding the export culture, is causing a

major set back for the full realization NEXIM’s potentials.

e. Near-total reliance of Bank on NEXM of Export finance

resources.

f. Over regulation of the non-oil export sector.

g. Underdeveloped regional and sub-regional markets.

51

h. Policy instability

i. Capital flight marketing and pricing problems.

a. Marketing Constraints: constraints to the marketing of

Nigeria’s agricultural produce are closely related to the issue

of poor infrastructure and inefficient marketing arrangement.

The small-scale farmer has poor market arrangement for his

farm produce due to largely poor infrastructure, poor

communication network and low access to logistic and inputs

support. The absence of rural feeder roads greatly inhibits

produce evacuation from collection points and adds huge

transportation costs. Lack of warehouse and other forms of

storage facilities result in hung post harvest losses which for

the small scale farmers are conservatively estimated at

between 20-40 percent of total output for tree crops and as a

high as 80 percent for fruits and other perishables. These

losses are among the highest in the world. The situation is

further worsened by the use of antiquated method in the farm

cleaning, storage, drying and transportation. The absence of

this basic infrastructure for transportation and storage create

a very huge marketing costs, which deny farmers and

produce merchants substantial share of their profit margin.

52

The absence of well organized marketing arrangement for the

country’s agricultural produce. The defunct marketing Board

provided convergent points for the sale, price moderation

and standardization of the country’s commodity exports. The

abolition of the marketing aboard on the heels of liberal

economic reforms of SAP create a vacuum in organized

produce marketing.

b. Pricing Problem: Farmers income, measured in term of

receipts sales or earnings from the business of farming

depends on the costs of farm input and yields on one hand.

Satisfactory farm income reflects prosperity in the farming

sub-sector. This also encourages further investment

especially in improved technology and related activities. It

has been observed that average yields have not improved in

the last ten years or so and in some declines were recorded

because of failure to get inputs in time.

However, the researcher will use the study to identify and

evaluate the problems of non-oil export products of Nigeria.

53

CHAPTER THREE

RESEARCH METHODOLOGY

3.1. SOURCES OF DATA

Data used in this study came from two courses, which are primary

and secondary data.

3.2. PRIMARY DATA

Primary data are in the form as generated from questionnaires and

interview of the officials of Nigeria Export Promotion Council (NEPC) and

Enugu Chamber of Industry Mines and Agriculture respectively.

3.2. SECONDARY DATA

Secondary data used came from publication of the Federal

Office of statistics (FOS). Central Bank of Nigeria (CBN)

textbooks, journals, magazines, seminar papers, and other

published and unpublished materials.

3.3. SAMPLING PLAN

The most direct way to estimate the problems and prospects of

marketing non-oil export products of Nigeria is to survey the businesses

involved in export marketing as well as manufacturing.

54

The primary objective in determining the sources of the

primary data was to use a sample that resembled the pool of

the exporters.

3.4 DETERMINTAION OF THE SAMPLE SIZE:

It was noticed that impediments arose in trying to reach the entire

Population. Due to these shortfalls, a sample of the population was

resorted to which will be a good representation of the whole population.

The sample size consists of random selection of the two cities and the

size was determined via the adoption of the following formula.

N =(Z)2 P x (I –P)

E

WHERE

N = the size of the sample

Z = standard score corresponding to givens confidence level.

E = the proportion of sample error in a given situation

P = the estimated proportion or incidence of eases in the

population

55

SOURCE:

Leedey, Paul D. Practical Research: Planning and Design

(New York, Macmillan 1980) P. 116 quoted in Ikeagwu E.K Groundwork

of resrarch method and Procedure 1996 P. 153

For the purpose of this study.

Z = 95% = 0.95 at “t” = 1.96

E = 5% = 0.05

P = 93% = 0.95

(I –P) or Q = 7% = 0.07

Thus N = (Z)2 (P –P2) +4

= (1.96)2 (93-(0.93)2

0.05

153.64 x 0.0651 = 100.35

N = 101 Approximate + 4 105

3.5 TECHNIQUE FOR COLLECTION OF DATA

56

The researcher adopted various techniques in the collection of the

data.

i) QUESTIONNAIRE: Questionnaire method was used to

bring out the necessary answer to the structured questions.

The researcher adopted this to highlight in detail the problem

and prospects of contained non-oil export products of

Nigeria. The questionnaire options amongst the available

options of “Yes”, “No”, “Indifferent” and no idea.

ii) ORAL INTERVIEW: Interview was administered discretely

to the management of the case organization to ascertain

immediate responses to the questions.

3.6 METHOD OF DATA ANALYSIS:

The researcher made use of tables in presenting the data received

and collected from the respondents. The tables were further explained

using percentage analysis where applicable. The Chi-square formula

was adopted in final analysis of the data and testing of the hypothesis.

The Chi-square test is used in causal comparative studies comparison

between observed and theoretical frequencies, and in an analyzing data

that are expressed as frequencies. The chi-square formula is given as

57

X2 = E(Oi.(i)2

Ei

WHERE

X2 = Chi-square

V = Degree of freedom as (number of row -1) x number of

column).

X = Level of significant

O = Observed frequency of the responses to each alternative

option in any specific question.

E = Expected frequency of responses calculated as follows

Row Total x Column Total

Grant Total

SOURCE: Lucey T, (1992) quantitative techniques London Dpp.

Publications. P 75

58

CHAPTER FOUR

DATA PRESENTATION AND ANALYSIS

The problem under study is an empirical study of the problem and

prospects of marketing Nigeria’s non-oil export products. The data

generated from the questionnaire administered on respondents in the

selected towns of Enugu, Nsukka will be analysis in this chapter. In

analyzing these data, tables and some statistical tools will be adopted.

This chapter also shows the test if hypotheses.

TABLE 4.1

QUESTIONNAIRE DSITRIBUTION AND RATE OF RETURN

Option Enugu Nsukka Total %

Completed 57 28 85 80.15

Not returned 3 17 20 19.05

Total Distribution 60 45 105 1000

Table 4.1 shows that a total of 102 questionnaires were distributed

which represents the sample size. It was distributed at the ration of

60:45 Enugu Nsukka respectively. At Enugu, 57 copies of the

59

questionnaire were returned completed which represented 95%.

Represented 62%. At total of 85 copies were completed and returned

representing 80.95%. this 80.95% is considered adequate for the

research work. The analysis will now be fully based on the 85 copies of

the returned questionnaire.

TABLE 4.2

Types of products exported arranged according to the SITC grouping

Option Enugu Nsukka Total %

Food and Livestock 20 10 30 35.29

Animal, Vegetable oil

& fats

25 12 37 43.52

Manufactured goods 10 4 14 16.47

Total 57 28 85 100

Table 4.2 shows that 35.08% and 37.71% of respondents representing

Enugu and Nsukka believe that the source comes from food and

livestock, 43.85% and 42.85% responded to crude oil, 17.54% and

14.28% responded animal, vegetable oil and fats, while 3.50% and

7.14% responded to manufactured goods respectively.

4.3 SOURCES OF MARKET INFORMATION

Option Enugu Nsukka Total %

60

Newspaper &

Magazine

20 15 52 41.17

Trade fair &

exhibition

14 8 22 25.88

Nigeria export

council

8 4 12 14.11

Chamber of

commerce

5 1 6 7.05

Internet 5 5 10 11.76

Total 52 33 85 100

Table 4.3 shows that 38.42% representing Enugu and Nsukka

respectively believe that the source of market information comes from

newspaper and magazines. 26.77% and 13.46% believe that the source

is from trade fair and exhibition, 13.46% and 7.68 responded to Nsukka

export council, while 9.62% and 9.62% also believe that is comes from

chamber of commerce respectively.

TABLE 4.4

AREA WITH HIGHEST EXPORT PROSPECTS

Option Enugu Nsukka Total %

Manufactured 10 5 15 17.64

61

Mineral 25 10 35 14.17

Hyde and skin 15 10 25 19.41

Total 57 28 85 100

Table 4.4 shows that 17.85% representing Enugu and Nsukka believe

that area with the highest export prospects is from manufactured

goods,43.85% and 35.71% responded to mineral products, 12.28% and

10.71% responded to timber while 26.31% and 35.71% responded to

Hyde and skin respectively.

Table 4.5

Agencies that promote non-oil export products.

Option Enugu Nsukka Total %

Government 25 10 35 41.17

NGO 15 5 37 23.25

International

agencies

10 8 18 21.17

Others 7 5 12 14.11

Total 57 28 85 100

Table 4.5 show that 43.85% and 35.71% of the respondent representing

Enugu and Nsukka believe that government promote non-oil export

products, 16.31% and 17.85% responded to non governmental

62

organization, 17.54% and 28.57% responded to international agencies

while 12.28% and 17.85% responded to others respectively.

Table 4.2 shows that the greatest number of respondents is from group

one which is the group for food, and live animals . all agricultural

products are included here, they represent about 30 percent followed by

crude minerals and excluding fuel which represent 13.8 percent of the

respondents. A significant percentage of 13.8 of the respondents come

from the manufacturing sector respectively.

TABLE 4.3

PROPORTION OF OPERATING COST

Cost No of Respondents Percentage

Production 22 42.26

Overhead 12 23.03

Sales promotion 5 9.62

Advertisement 10 19.23

Export market

research

2 3.8

Others 1 1.9

Total 52 100

63

Table 4.3 shows that 22 of the respondents or 46% believes that

operating cost goes to production, 12 respondents or 21% responded to

overhead cost. As little of 2 respondents or 4% responded to market.

Option Enugu Nsukka Total

Yes 30 30 50

No 20 5 25

Indifferent 7 3 10

Total 57 28 85

Row = Column 2

V = (R-1) (C-1) = (2-1) =1

1 degree of freedom at 0.05 significant level

X2 1, 0.05 = 3.841

DECISION

Reject Ho, if calculated X2 is greater than the critical X2 of 3.841.

Otherwise do not reject.

EXPECTED FREQUENCY

Σ of 30 = 50 X 57 = 33.52

85

Σ of 20 = 28 X 50 = 16.47

64

85

Σ of 20 = 57 X 25 = 16.76

85

Σ of 5 = 28 X 25 = 8.23

85

Σ of 7 = 57 X 10 = 6.70

85

Σ of 3 = 28 x 10 = 3.29

85

CONTINGENCY TABLE

0 Σ 0 – Σ (0 – Σ)2 (0 – Σ)2/ Σ

30 33.52 -3.52 12.39 0.3696

20 16.47 3.53 12.46 0.7562

20 16.76 3.24 10.49 0.6258

5 8.23 -3.23 10.43 1.2673

7 6.73 0.27 0.07 0.0104

3 3.29 -0.29 0.08 0.0243

X2 4.0432

65

DECISION

Since the calculated X2 of 4.0432 is greater than the critical value X2 of

3.841, the Null hypothesis Ho, which states that there is not enough

information available to exporters about the existence of market for their

product is rejected, while the Alternative hypothesis H1, which states

that there is enough information available to exporters about the

existence of market for their product is accepted.

HYPOTHESIS II

HO Cost of production does not affect the international

competitiveness of Nigeria’s export product.

H1 High cost of production affects the international competitiveness of

Nigeria’s export products.

Row = 2 Column = 2

V = (2-1) (2-1)

1 degree of freedom at 0.05 level of significant.

X2 1, 0.05 = 3.841

66

Decision Reject Ho, if the calculated X2 is greater than critical X2 of

3.841. otherwise do not reject.

Option Enugu Nsukka Total

Yes 28 15 43

No 20 10 30

Indifferent 9 3 12

Total 57 28 85

EXPECTED FREQUENCY

Σ of 28 = 57 X 43 = 28.83

85

Σ of 15 = 28 X 43 = 14.16

85

Σ of 20 = 57 X 30 = 20.11

85

Σ of 10 = 28 X 30 = 9.88

85

Σ of 9 = 57 X 12 = 8.04

85

Σ of 3 = 28 x 12 = 3.95

67

85

CONTINGENCY TABLE

0 Σ 0 – Σ (0 – Σ)2 (0 – Σ)2/ Σ

28 28.83 -0.83 0.69 0.0238

15 14.16 0.70 0.49 0.0351

20 20.11 -0.11 0.01 0.0006

10 9.88 0.12 0.01 0.0014

9 8.04 0.96 0.92 0.1146

3 3.95 -0.95 0.90 0.2284

X2 6.4039

DECISION

Since the calculated X2 of 4.0432 is greater than the critical value X2 of

3.841, the Null hypothesis Ho, which states that high cost of production

does not affect the international competitiveness of Nigeria export

product is rejected, while the Alternative hypothesis H1, which states

that high cost of production affect the international competitiveness of

Nigeria export product is accept.

68

HYPOTHESIS III

HO The export incentive are not effective in the marketing of non-oil

export products.

H1 The export incentive are effective in the marketing of oil non-oil

export products.

Option Enugu Nsukka Total

Yes 40 13 53

No 17 15 32

Total 57 28 85

Row = Column

V = (R-1) (C-1) = (2-1) = 1

1 degree of freedom at 0.05 level of significant level.

X2 1, 0.05 = 3.841

DECISION

Reject Ho, if calculated X2 is greater than critical X2 of 3.841. otherwise

do not reject.

EXPECTED FREQUENCY

Σ of 40 = 57 X 53 = 35.54

69

85

Σ of 13 = 28 X 53 = 17.45

85

Σ of 17 = 57 X 32 = 21.45

85

Σ of 15 = 28 X 32 = 10.54

85

CONTINGENCY TABLE

0 Σ 0 – Σ (0 – Σ)2 (0 – Σ)2/ Σ

40 35.54 4.46 19.89 0.5596

13 17.45 -4.45 19.80 1.1348

17 21.45 -4.45 19.80 0.9232

15 10.54 4.46 19.89 1.8872

3. 17 X 45 = 34.06

52

4. 17 X 9 = 2.94

52

5. 14 X 43 = 11.58

52

70

7. 14 X 9 = 2.42

52

CONTINGENCY TABLE

Cell 0 Σ 0 – Σ (0 – Σ)2 (0 – Σ)2

Σ

1 17 17.37 -0.37 0.1349 7.881

2 4 3.63 1.63 2.6569 0.7319

3 15 14.06 1.06 1.1236 0.0799

4 2 2.94 -0.94 0.8836 0.3005

5 11 11.58 -0.58 0.3364 0.291

6 3 2.42 1.42 2.0164 0.8332

X2 9.8556

Critical value

Degree of freedom = (2-1) (1-1)

= (2-1) (3-1)

Σ of 14 = 28 X 49 = 16.14

85

71

Σ of 15 = 57 X 25 = 16.76

85

Σ of 10 = 28 X 25 = 8.23

85

Σ of 7 = 57 X 11 = 7.37

85

Σ of 4 = 28 X 11 = 3.62

85

CONTINGENCY TABLE

0 Σ 0 – Σ (0 – Σ)2 (0 – Σ)2

Σ

35 32.85 2.15 4.62 0.1407

14 16.14 -2.14 4.58 0.2837

15 16.76 -1.76 3.09 0.1848

10 8.23 1.77 3.13 0.3806

7 7.37 -0.37 0.13 0.0185

4 3.62 0.38 0.14 0.0398

X2 5.0481

72

DECISION:

Since the calculated X2 of 5.0481 is greater than the critical X2 of 3.841,

the null hypothesis Ho, which states that the low quality of Nigeria

product does not affect it exports market performance is rejected, while

the alternative hypothesis H1, which states that the low quality of Nigeria

product affects its exports market performance is accepted.

HYPOTHESIS V

HO: reduced levels of new investments in discovered mineral deposit

does not affect their marketing.

H1: Reduced level of new investment in discovered minerals deposits

affect their marketing.

RESPONSES ENUGU NSUKKA TOTAL

Yes 39 18 57

No 12 8 20

Indifferent 6 2 8

Total 57 28 85

DECISION

73

Reject Ho, if calculated X2 is greater than critical x2 of 3.841. otherwise

do not reject.

EXPECTED FREQUENCY:

Σ of 39 = 57 X 57 = 38.22

85

Σ of 18 = 28 X 57 = 18.77

85

Σ of 12 = 57 X 20 = 13.41

85

Σ of 8 = 28 X 20 = 6.58

85

Σ of 6 = 57 X 8 = 5.36

85

Σ of 2 = 28 X 8 = 2.63

85

CONTINGENCY TABLE

74

0 Σ 0 – Σ (0 – Σ)2 (0 – Σ)2/ Σ

39 38.22 0.78 0.61 0.0159

18 18.77 --0.77 0.59 0.0315

12 13.41 -1.41 1.98 0.1482

8 6.58 1.42 2.01 0.3064

6 5.36 0.64 0.40 6.0764

2 2.63 0.63 0.39 0.1509

X2 6.7608

DECISION

Since the calculated X2 of 6.7608 is greater than critical value of

x2 of 3.841, the Null hypothesis Ho, which states that Reduced Level of

new investment in discovered mineral deposits affect their

DECISION RULE

Since the calculated value of X2 (33.44) is greater than the table

value of 9.488, the null hypothesis which states that high cost of

production does not affect the international competitiveness of Nigerian’s

export products is rejected while the alternative hypothesis which states

that high costs of production affects the international competitiveness of

Nigerian’s export product is hereby accepted.

75

HYPOTHESIS III

H0: The export incentive are not effective in the marketing of non-oil

export products.

HI: The export incentive are effective in the marketing of oil non-oil

export products.

In testing this hypothesis, responses to related question as indicated in

questionnaire attached to the appendix was adopted.

Respondents Yes N0 Total

Enugu 15 (cell 1) 4 (cell 2) 21

Nsukka 10 (cell 3) 5 (cell 2) 17

Agwu 3 (cell 5) 5 (cell 4) 14

TOTAL 28 14 15

Calculation of expected frequencies

Formula = Column total Row total

Grand total

1. 28 x 21 = 11.31

76

52

2. 28 x 17 = 9.15

52

3. 28 x 14 = 7.54

52

4. 14 x 21 = 5.65

52

5. 14 x 17 = 4.58

52

6. 14 x 14 = 3.77

52

7. 10 x 21 = 4.04

52

8. 10 x 17 = 3.27

52

9. 10 x 14 = 2.70

52

77

CONTINGENCY TABLE

CELL 0 Σ 0-Σ (0-Σ)2 (0-Σ)2

Σ

1 15 11.31 3.69 13.616 1.2039

2 4 9.15 5.15 26.523 2.8986

3 2 7.54 5.54 30.692 4.0750

4 10 5.65 4.35 18.923 3.3491

5 5 4.56 0.42 0.176 0.0385

6 2 3.77 -1.77 3.133 0.8310

7 3 4.04 -1.04 1.082 0.2077

8 5 3.27 1.73 3.00 0.9174

9 6 3.70 3.0 10.89 4.0333

X2 17.62

Critical value

Degree of freedom = (v-1) (v-1)

= (3-1) (3-1)

78

= 2 x 2 = 4

DECISION RULE

Since the calculated value of X2 (17.62) is greater than the table

value of 9.488, the null hypothesis which states that the export

incentives are not effective in the marketing of non-oil export products is

hereby rejected while the alternative hypothesis which states that export

incentives are effective in the marketing of non-oil export products is

accepted.

HYPOTHESIS IV

H0: The low quality of Nigeria product does not affect its export market

performance.

H1: The low quality of Nigeria product affects its export market

performance.

Respondents Yes N0 Total

Enugu 17 (cell 1) 2 (cell 2) 21

Nsukka 9 (cell 3) 7 (cell 4) 17

Agwu 2 (cell 5) 5 (cell 6) 14

79

TOTAL 28 14 52

Calculation of expected frequencies

Formula = Column x Row total

Grand total

1. 28 x 21 = 11.31

52

2. 28 x 17 = 9.15

52

3. 28 x 14 = 7.54

52

4. 14 x 21 = 5.65

52

5. 14 x 17 = 4.58

52

6. 14 x 14 = 3.77

52

7. 9 x 21 = 3.63

80

52

8. 9 x 17 = 2.94

52

9. 9 x 14 = 2.42

52

CONTINGENCY TABLE

CELL 0 Σ 0-Σ (0-Σ)2 (0-Σ)2

Σ

1 17 11.31 5.69 32.376 2.863

2 2 9.15 -7.15 51.123 5.587

3 2 7.54 5.54 30.692 4.071

4 9 5.65 3.75 11.223 1.986

5 7 4.56 2.44 5.954 1.306

6 1 3.77 -2.77 7.673 2.035

7 2 4.04 -2.04 4.162 1.030

8 5 3.27 1.73 2.993 0.915

9 7 3.70 3.30 10.89 2.943

X2 22.74

Critical value

81

Degree of freedom = (v-1) (v-1)

= (3-1) (3-1)

= 2 x 2 = 4

At 4 degree and 0.05 level of significance the value of X2 = 9.488.

DECISION RULE

Since the calculated value of X2 (22.74) is greater that the table

value of 9.488, the null hypothesis which states that the low quality of

Nigerian product does not affect its export market performance is

rejected, while the alternative hypothesis which states that the low

quality of Nigerian product affects its export market is hereby accepted.

HYPOTHESIS V

H0: Reduced levels of new investments in discovered mineral deposit

does not affect their marketing.

HI: Reduced level of new investment in discovered minerals deposits

affect their marketing.

In testing this hypothesis responses to related question as indicated in

the questionnaire attached to the appendix was adopted

Respondents Low High Total

82

Enugu 17 (cell 1) 4 (cell 2) 21

Nsukka 15 (cell 3) 2 (cell 4) 17

Awgu 11 (cell 5) 3 (cell 6) 14

Total 43 9 52

Calculation of expected frequencies

Formula = Column Total x Row Total

Grand Total

1. 21 x 43 = 17.37

52

2. 21 x 9 = 3.63

52

3. 17 x 43 = 34.06

52

4. 17 x 9 = 2.94

52

5. 14 x 43 = 11.58

52

6. 14 x 9 = 2.42

83

52

CONTIGENCY TABLE

CELL 0 Σ 0-Σ (0-Σ)2 (0-Σ)2

Σ

1 17 17.37 -0.37 0.1349 7.881

2 4 3.63 1.63 2.6509 0.7319

3 15 14.06 1.06 1.1236 0.0799

4 2 2.94 -0.94 0.8836 0.3005

5 11 11.58 -0.58 0.3364 -0.0291

6 3 2.42 1.42 2.0164 0.8332

X2 9.8556

Critical value

Degree of freedom = (2-1) (1-1)

= (2-1) (3-1)

= 1x2 = 2

At 2 degree of freedom and 0.05 level of significance the value of

X2 = 5.991

84

DECISION RULE

Since the calculated (x2 – value of 9.8556 is greater than the table

value of 5.911, we reject the null hypothesis which states that reduced

level of new investments in discovered mineral deposits does not affect

their marketing is rejected, while the alternative hypothesis which states

that, reduce level of new investments in discovered mineral deposits

affect their marketing is accepted .

HYPOTHESIS VI

Ho: Inappropriate pricing of agricultural export products does not affect

their international market performance.

H1: Inappropriate pricing of agricultural export products does not affect

their international market performance.

In testing the hypothesis, responses to related question as

indicated in the questionnaire attached to the appendix was adopted.

Respondents Premium Discount Normal Total

Akwa 5 (cell 1) 13 (cell 2) 3 (cell 3) 21

Enugu 2 (cell 4) 9 (cell 5) 6 (cell 6) 17

Aba 4 (cell 7) 5 (cell 8) 7 (cell 9) 16

85

Total 28 14 16 52

Calculation of expected frequencies

Formula = Column Total x Row Total

Grant Total

1. 11 x 21 = 4.42

52

2. 11 x 17 = 3.60

52

3. 11 x 16 = 3.38

52

4. 25 x 21 = 10.10

52

5. 25 x 17 = 8.17

52

6. 25 x 16 = 7.70

52

7. 16 x 21 = 6.46

52

86

8. 16 x 17 = 5.23

52

9. 16 x 16 = 4.92

52

CONTIGENCY TABLE

CELL 0 Σ 0-Σ (0-Σ)2 (0-Σ)2

Σ

1 5 4.42 0.58 0.3364 0.076

2 13 3.60 9.4 88.360 24.544

3 3 3.38 -0.38 0.014 0.043

4 2 10.10 -8.1 65.610 6.496

5 9 18.17 0.83 0.6889 0.0843

6 6 7.70 -1.70 2.89 0.375

7 4 6.46 -2.46 6.0516 0.937

8 5 5.23 -0.23 0.053 0.010

9 7 4.92 2.08 4.326 0.879

X2 33.444

Critical value

Degree of freedom = (R-1) (C-1)

= (3-1) (3-1)

87

= 2x2 = 4

At 4 degree and 0.05 level of significance the value of X2 =

9.488

DECISION RULE

Since the calculated value x2 – value of (33.44) is greater than the

table value of 9.488, the null hypothesis which states, inappropriate

pricing of Nigeria agricultural export production does not affect its

international market performance is rejected, while the alternative

hypothesis which states that inappropriate pricing of Nigeria’s

agricultural export products affects its international market performance

is hereby accepted.

88

CHAPTER FIVE

SUMMARY OF FINDINGS, CONCLUSIONS AND

RECOMMENDATION

5.1 SUMMARY OF FINDINGS

According to the research work conducted, the finding made by the

researcher includes the following:

a. High cost of production affects the international

competitiveness of Nigeria’s export products.

b. The Export incentive are affective in the marketing of non-oil

export products.

c. There is enough information available to exporters about the

existence of markets. For non-oil products.

d. The low quality of Nigerian exports affect its export market

performance .

e. The few exports recorded were destined towards such

economic blocks as Western Europe and Africa.

f. Over 70 percent of operating expenses go into production

while as little as 2 percent goes into export market research.

89

g. Newspapers, Magazine, International trade fair and

exhibitions, Nigerian export promotion council formed the

bulk of sources of information for export market.

h. Areas with highest export potentials are Agricultural

products.

i. Manufactured products have export potential in the west

African sub-region.

j. Manufactured products failed to compete favourably because

of non- development of the industries base of the country,

which has inadequate infrastructure.

k. Government agencies in the export sector finance export

promotion activities in the export sector could have been

performed better by consultants.

The government has started in a good way by establishing export

pricing zone (EP2) and try ports. It has even been recommended that

export villages should be established. In this regard, the agencies

involved in the export trade like the shippers council, the standard

organization of Nigeria, should be provided with the necessary work

environment to carryout their task.

90

5.2 CONCLUSION

In the absence of petroleum, Nigeria is an agricultural country and

the development of agro-based industries appears to be an appropriate

strategy for export expansion in the medium term. Its considerable

resources inland, water, agricultural manpower and skills offer promising

opportunities to diversify agricultural exports away from oil. The best

possibilities appear to be in expansion of industries that produce semi-

processed goods from the major export commodities of cocoa, palm

products, and natural rubber, since prospects of exporting the raw

materials seems gloomy, based on our analysis, marine products, fruits

and vegetables, and cattle and daily faming are other areas identified as

prospective product markets.

In addition to identifying export commodities, diversification of

agricultural production for export also involves transformation of supply

capabilities supported by proper research and extension services,

transport links from producing areas to processing or dispatch centres,

cold storage facilities and special marketing arrangements, for such a

diversified program to have an impact on export expansion. The

government’s foreign. Investment policy and package of incentives

though successful in attracting some investment needs a clearer

determination of government strategy in the medium term with regard to

91

the scope, role and responsibility of foreign participation. A foreign

investment protection Act or an establishment of export zone will act as

further stimulants to increased investment and trade. Nigeria can obtain

foreign collaboration and know-how to accelerate implementation of its

present strategy of augmenting export earnings through value-added

channels such as cocoa, and palm products. The provision of an

extended package of incentives to the local investors to match the

benefits granted to the foreign investors would also help to attract better

type of local investors.

Participation in international trade fairs, export training and trade

information collection and dissemination constitute three other majors

areas, where considerable promotional work is being carried out with

growing intensity. This needs to be further expanded in order make the

more effective trade promotion instruments to help export expansions.

For Africa to reverse it unfavourable export trends, this regime

must adopt appropriate trade and structural adjustment policies in order

to enhance its international competitiveness and capitalize on

opportunities in foreign market collier (1995) identified political and policy

uncertainty, a high risk environment and inadequate government

commitment to reforms as key factors in Africa marginalized taxes,

92

smuggling and false invoicing have negative effect on trade

performance.

Embracing of information technology promotion of export

incentives, cooperation with trade promotion agencies and ministries,

cooperation with international trade agencies and participation in

ECOWA export international trade exhibitions and adopting appropriate

macro economic policies and strategies to encourage and promote

export.

5.3 RECOMMENDATIONS

I. ADOPTION OF APPROPRIATE MACROECONOMIC

POLICIES

Macroeconomic policies especially those on exchange rates and

prices, should be worked out in such a way that export will be encourage

and promoted. Over valuation of currencies and high rates of inflation,

as well as lack of macroeconomic stability have always discouraged the

growth of export. When a currency is over-valued, exporters are not

encouraged, while an under-valued currency it self makes the cost of

importation of raw material inputs too high resulting in high products

prices. Similarly, a high domestic inflation rate fueled by an unbridled

93

level of deficit spending makes exports less competitive. These are the

conditions that have characterized the country’s economy over the past

20 years. With SAP, under which exchange rates adjustment is central in

turning around the economy, the success in the economic adjustment

effort platform for achieving the macro stability reforms will help in

eliminating inconsistencies in polices.

II. PROVISION OF EFFICIENT INFRATRUCTURE

FACILITIES.

The infrastructural facilities. Such as adequate and regular water

supply, power supply, road network and have all worked against

industrial development in the country. The need to self-acquire and put

in place some of these facilities has raised the production of many

industries, thus making their products less competitive in the export

market.

iii. SOCIO-POLITICAL STABILITY

the need for a peaceful industrial and political climate is crucial to

export development in the context of overall economic development.

Inspite of recent improvements, Nigeria is still characterized by high

social and political instability. Industrial harmony is not while incidence of

insecurity of life and property is a matter of concern. These trades have

94

to be reversed for any meaningful export growth and development to be

achieved.

iv. THE NEED FOR EFFICIENT EXPORT INSPECTION.

In order to ensure high quality exports that can compete

favourable in the world market and also assure that export proceeds are

repatriated, specialized institutions should be established to supervise

the exportation of commodities, poor quality of exports can attract

sanctions against export countries, which may worsen the export

prospects. This was what happened in 1990 when Nigeria’s cocoa was

blacklisted because it was not well fermented before exported. With

efficient and function inspection institution in place, the problem of

standardization and quality would addressed.

v. NEED TO DIVERSIFY EXPORTS TOWARDS FASTER

GROWING MARKETS.

Given the prospects and difficulties encountered by Nigerian

export trying to break into the Western European and the American

Markets, in the years ahead, the country should refocus and redirect

her activities to other segments of the globe. The country should break-

up explore higher global market share in the faster-growing market of the

transit on economics of Eastern Europe and the South-East Asian

95

countries. Currently, the value of trade with these countries represent a

small fraction of the country’s total trade with the out side world, and the

relationship has remained lopsided against Nigeria. The country’s export

is negligible in all cases, whereas the import of Nigeria from these

countries growing rapidly. There is so much potential that Nigeria could

explore from such markets and those developing of countries, such as

ECOWAS, the Caribean as well as Asia and other countries of Africa.

These are areas were South-South relationship and cooperation,

currently being emphasized could be development to improve the

country export trade.

vi THE USE OF E-BUSINESS.

The advent of information technology has charged the rules of

business. in the present era, the importance of E-business and internet

as a tool to lower communication costs and reduce time to market goods

services.

Finally, having reviewed the policies and strategies that have been

adopted to boost and diversify exports of Nigeria in recent times. We

should also draw lessons from experiences of successful countries. We

have attempted to highlight the benefits of export-led development

strategies and the pre-condition for an effective export policy. Major

constraints to the success of export promotional policies were discussed.

96

Like other African countries, Nigeria still depends largely on one primary

produce for export, Crude Petroleum. Moreover, export of manufactures

have remained low and insignificant

Although, the policies put in place have recognized the need for

export promotion and diversification they are, however, yet to achieve

the desired level of success. Consequently, policies are being received

in the light of experiences to boost the level of exports and to achieve a

diversified export base especially in manufactures. Unfortunately, for

several reasons, which include shortage of capital and difficulties in the

restricting existing import- substitution industries to produce for export,

lack of appropriate and enabling results. When compared with pre SAP

Period, export volume and the overall trade – able goods have

increased, the increase in the value of exports over the years has,

however remained minimal due to the deterioration in the country’s

terms of trade.

Consequently, it is recommended that a number of policy

measures be adopted to make exports competitive and achieve

diversification into manufactures.

Equally, there is the urgent need to adopt appropriate

macroeconomic policies. Such policies should includes a consistent set

of tariff policies that would aid export development. The immediate

97

reactivate of NEXIM is desirable. The reactivation should involve the

reconstitution of the board to include private sector operations, the

ministry of commence and Central Bank of Nigeria. The Board should

be independent of all the organs of government. NEXIM should be

strengthened to provide pre and post shipment financing of exports,

similarly, the Nigeria Export promotion council should be reconstituted in

order to achieve or actualize its aims and objectives respectively.

The advent of information technology has charged the rules of

business. in the present era, the importance of E-Business and internet

as a tool to facilitate business activities is fast becoming an effective tool

to lower communication costs and reduce time to market goods and

service.

Finally, haring reviewed the policies and strategies that have been

adopted to boost and diversity exports of Nigeria in recent times. We

should also draw lessons from experiences of successful countries. We

have attempted to highlight the benefits of export-led development state

gin and the precondition for an effective export policy. Major constraints

to the success of export promotional policies were discussed. Like other

African countries, Nigeria still depends Largely on one primary produce

for export, Crude Petroleum. Moreover, export of manufactures have

remained low and insignificant.

98

Although, the policies put in place have recognized the weed for

export promotion and diversification they are, however, yet to achieve

the desired level of success. Consequently, policies are being received

in the light of experiences to boost the level of exports and to achieve a

diversified export base especially in manufactures. Unfortunately, for

several reasons, which include shortage of capital and difficulties in the

restricting existing import-substitution industries to produce for export,

lack of appropriate and enabling macro-economic policies the measures

are yet to yield. The expected results. When compared with pre SAP

period, export volume and the overall; trade – able goods has increased,

the increase in the value of exports over the years has, however

remained minimal due to the deterioration in the country’s terms of

trade.

Consequently, it is recommended that a number of policy

measures be adopted to make exports competitive and achieve

diversification into manufactures.

Equally, there is urgent need to adopt appropriate macroeconomic

policies. Such policies should includes a consistent set to tariff policies

that would aid export development. The immediate reactivate of NEXIM

is desirable. The reactivation should involve the reconstitution of the

board to include private sector operations, the ministry of commence and

99

Central Bank of Nigeria the Board should be independent of all the

organs of government. NEXIM should be strengthened to provide pre

and post shipment financing of exports, similarly, the Nigeria Export

promotion council should be reconstituted and restructures in order to

achieve or actualize its aims and objectives respectively.

100

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and Development Volume 26 No 2 June 1989, P. 34. Quarterly

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Department of Marketing

University of Nigeria

Enugu Campus.

March 10, 2006

Dear Sir/ Madam,

The undersigned a post-graduate study of the above-named

department and institution, is carrying out a study on the problems and

prospects of Marketing Non-Oil Export Products from Nigeria.

Kindly answer the question below. This exercise is purely for

academic use and any information supplied will be treated in strict

confidence.

Yours Sincerely

KANU IHUOMA

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SECTION A: GENEAL

1. Name of Organization …………………………………………............

2. Location …………………………………………………………………..

3. Year Export Commenced ………………………………………………

4. Export Product(s) Handle ………………………………………………

5. Sources of export products handle (please circle)

a) Direct Production

b) Procurement from other producers

c) Combination of (a) and (b)

6. Average number of export transactions/orders handle per annum

……………………………………………….

7. Would you normally have had more transactions/orders than

indicated in (6) above Yes No

8. If “yes” what are the constraints? Please List?

……..………………………………………………………………………

……………………………………………………………………………..

9. (i) Is your sale at premium, normal, or discount price? (please

underline as appropriate).

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ii) What reasons best explain your answer in 9(i)

SECTION B: MARKETING

1. What is the nature and source of your raw material?

…………………………………………………………………………..…

……………………………………………………………………………..

Are they readily available? Yes No

If “No” give reasons

…………………………………………………………………………..…

…………………………………………………………………………….

2. What is your position in the Company?

i) Manager, Executive or Above

ii) Supervisor, Officer or equivalent

3. Qualification Mix:

Professional e.g. Nigerian Institute of Marketing (NIMARK), etc

University Degree, HND or equivalent

Professional Diploma

OND, NCE, etc

4. Please give the proportion (%) of your operating costs that go into:

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Production

Overhead

Sales Promotion

Advertisement

Export Market Research

Any other

5. Which of these mediums do you use in sourcing markets for your

products

i) Newspaper and Magazine

ii) International Trade Fairs and exhibitions

iii) Nigeria Export Promotion Council (NEPC)

iv) Foreign Consults

v) Internet

vi) Nigeria Consulates

6. There is adequate market information available to the exporter

Yes No

7. Are you satisfied with markets available for your products?

Yes No

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8. Why do you say so?

…………………………………………………………………………..…

…………………………………………………………………………..…

……………………………………………………………………………

9. What is the image rating of Nigeria Businessmen by your

customers?

i) Low ii) High iii) Indifferent

10. If “Low” what is effect on your export sales?

……………………………………………………………………………………

……………………………………………………………………………………

……………………………………………………………………………………

……………………………………………………………………………………

11. Which of the following factor, in your view hinder Nigeria’s non-oil

export marketing?

(i) Non Implementation of major export incentives

(ii) Low product quality

(iii) High product price

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(iv) Lack of knowledge about the market

(v) Distrust of Nigeria Businessmen

(vi) poor product presentation and packaging

12. The low quality of Nigeria export products affects their international

Competitiveness

Yes NOs

13. High Cost of production affects international competitiveness of

Nigeria’s export products.

Yes No

14. Which export incentives have you benefited from?

……………………………………………………………………………………

……………………………………………………………………………………

……………………………………………………………………………………

…………………………………………………………………………………..

15. If you have not benefited from any, why?

……………………………………………………………………………………

…………………………………………………………………………………..

16. Export incentives are effective in boosting export market.

Yes No

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