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Monday, March 20, 2023

UK Close to Signing Major Free Trade Deal with Nigeria

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The UK trade ministry is on the brink of an ambitious trade deal with Africa’s largest economy, a UK trade envoy has said.

An “absolutely huge” trade deal is in the works, covering sectors such as tech, financial services, agriculture and green technology, the UK’s trade envoy to Nigeria, Helen Grant told the UK’s Express.co.uk online newspaper.

“I also do get the strong feeling that we, of course, would be open to discussing an FTA with other West African countries.

“Nigeria is now at the helm of the WTO, I think that will be very helpful. And the fact that Nigeria has signed the African Continental Free Trade Agreement, I think all of these factors are of assistance,” she said.

The new trading terms would be “simpler and more generous” than the EU’s generalised scheme of preferences that governed UK foreign trade before Brexit, she told the British tabloid.

The UK has already passed legislation to transition the EU’s General Scheme of Preferences, which allows exporters from developing countries to pay less or no tariffs on a range of goods including almost everything except arms.

But West Africa’s Ghana and Nigeria were excluded from preferential trade as they failed to seal an agreement with the UK before the end of the Brexit transition period on December 31, 2020.

Nigeria is the UK’s 46th largest trading partner, currently accounting for 0.3% of total UK trade in 2020, according to the UK Department of International Trade.

Total trade in goods and services (exports plus imports) between the UK and Nigeria plummeted 28% or £1.2bn in 2020, from £3.2bn the previous year.

In 2020, UK exports to Nigeria dropped 28% to £1.9bn since the previous year. Exports to Africa’s largest oil producer were dominated by refined petroleum, accounting for 36% of exports, while textiles, soap products, and machinery made up the rest.

UK imports from Nigeria hit £1.3bn during the same period, slumping 27%, with crude oil (82%), refined oil (10%), gas (3.7%) and metal (1%) being the key Nigerian exports.

UK trade with Africa grew 7.5% in 2020 to $102bn, with a focus on machinery, oil and gas, tourism and professional services, but it languishes far behind that of China, the continent’s top trading partner at $208bn in 2019.

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