From Laide Raheem, Abeokuta
The Chief Executive Officer (CEO) of the German Chamber of Commerce, otherwise known as Giessen-Friedberg, Dr Matthias Leder, has attributed the low trade volume between Nigeria and the Republic of Germany to low labour productivity, high bank interest rates, lack of innovation, and illegal immigration.
Leder, who stated this in his presentation at the official opening of the 14th Gateway International Trade Fair in Abeokuta, the Ogun State capital, noted that the balance of trade between Germany and Africa, particularly Nigeria, compared to Brazil and the Republic of China, is very uneven.
He called for an improved foreign trade balance between Nigeria and Germany.
He bemoaned the below 1% volume of trade between the two countries, saying both nations must put efforts in place to improve the situation for their mutual benefit.
While calling for improved trade between the two countries, the German Chamber of Commerce boss disclosed that his dream is to see trade between Germany and Nigeria grow.
Leder, who observed that international trade has always been the cornerstone of prosperity and development, stressed that Germany was poised to change the narrative of the trade imbalance Nigeria is experiencing with Germany.
He noted that China’s investment in Africa over the last 20 years is much higher than that of Europe, as the country has invested in infrastructure, rail, ports, telecommunications, and more. He reiterated that Germany would work assiduously to close the trade gap with Nigeria, which is the most populous Black nation in the world.
“To change the narrative of the trade imbalance that Nigeria is having with Germany, you can improve the productivity of labour, you can improve the productivity of capital and innovation. We have this project called dual vocational training, which means improving the labour factor. These people receive excellent practical training, and they easily find jobs in Europe and in Germany because the training includes working in a company for three days and spending two days in a vocational training school.
“These people who participate in the dual training are better off in the company where they work because they get to see their clients hailing their work. So, dual vocational training is one means of improving productivity. Also, legal migration can improve the productivity of the country because those who migrate to Germany receive training there and earn a monthly payment equivalent to N5m, which can even double depending on the training and workplace, especially in the IT sector.
“Improving the productivity of capital is also important. It is not easy for small and medium businesses to get loans in this country because the interest rate is too high, about 20%. The leadership of the Ogun State Chamber of Commerce, Industry, Mines and Agriculture (OGUNCCIMA) has been trying to strengthen the cooperative economy and cooperative banking so that the interest rate for loans does not exceed 6%, making it affordable for small and medium enterprises.
“One other thing we are providing is innovation, and we do this by creating a platform for companies to meet. An example is our international conference from May 20 to 22, which provides an opportunity for companies across the globe to come together and access innovations that could help lift their businesses,” Leder stated.
The former Minister of Information and Culture, Lai Mohammed, said Nigeria should refrain from exporting raw materials and instead add value to them to make them more competitive in the international market.
While noting that the country should take advantage of regulatory bodies to meet international standards, the former minister pointed out that “rather than exporting our cocoa, our gold, we need to set up factories that can help with processing to give them more value before they are exported.”
On the issue of high interest rates, Lai Mohammed said, “the way out is cooperative banking; it is like the ‘esusu’ system that our forefathers used in the past.
“In this kind of arrangement, about 20 to 40 people who belong to the same industry can come together and contribute, with one of them taking the funds at the end of each month until it goes around. The interest rate is not more than 6%. Cooperative banking is the way to go,” he stated.
The President of the National Chamber of Commerce, Industry, Mines and Agriculture (NACCIMA), Dele Oye, disclosed that the chamber was already partnering with Germany to import machines for agro-processing, noting, “once you process your goods, the value you get is usually five times more than the 1% you would have without processing.”
He added that NACCIMA is also working with the Germans to establish a skills centre in Nigeria where entrepreneurs can be trained to improve skills, productivity, and technology transfer.
On his part, Wasiu Babatunde Olaleye, President of the Odu’a Chamber of Commerce, Industry, Mines and Agriculture (ODUACCIMA), said the international trade fair would provide an avenue to link medium and small-scale entrepreneurs with international markets.
He added that the trade fair has attracted participants from neighbouring countries such as the Republic of Benin, Niger Republic, and Rwanda from East Africa.