The Central Bank of Nigeria (CBN) governor, Godwin Emefiele, has revealed that the federal government has commenced talks with China about exporting goods to the lucrative Chinese market as part of the recent trade pact signed between the two nations.
President Muhammadu Buhari, last week, embarked on a business trip to China where he and Premier Xi Jinping signed several agreements involving infrastructural development, investment, technology transfer and foreign exchange dealings. Nigeria is currently China’s biggest trading partner in Africa and the two countries hope to boost the volume of trade between them with the series of new agreements signed.
According to the CBN governor, the federal government is now building on the gains of the agreements by discussing with China authorities about importing some items from Nigeria. He added that this will help reduce the gulf in trading between the two countries.
While speaking at the World Bank headquarters in Washington DC, on the last day of the 2016 World Bank/IMF spring meeting: “China has appointed South Africa as its trading hub for Remnibi transactions in the Southern African region; it has appointed Kenya as its trading hub for East and Central Africa. And Nigeria, the mandate that we signed is for us to be appointed as the trading hub in the West African sub region.È Said Mr Emefiele.
He also added, “We are talking to China so that it would also be importing some of its own items from Nigeria, so that the trading balance can be sort of reduced. Will Nigeria benefit from this? I want to say categorically that Nigeria will from this as it’s less pressure on the dollar and consequently on our reserves.”
Mr Emefiele added that the CBN could not continue with indeterminate adjustment and devaluation of the Nigerian currency the naira, without taking necessary structural reforms. He pointed out that the government has done an adjustment and is following it up with structural reform, to diversify the economy from depending on oil.
According to Emefiele: “During the China trip, we saw people who said they can now come in instead of exporting those items into Nigeria, they can now bring those plants into Nigeria and begin to produce those things in Nigeria because our climate is good. I repeat, what is the raw material for fertilizer? it is gas, which we have it in large quantities.
“When you bring in the plant, you don’t need to import any raw material again. We are seeing the light at the end of the tunnel and we just want people to show understanding,” Mr Emefiele added.
The governor did not specify which goods Nigeria is planning for export to China. Nigeria is currently the world’s sixth largest agricultural producer and a major supplier of cassava, kolanuts, yams, cocoa, cashews, shea nuts, etc but very limited amounts of this are exported.
