Head of Research at Sterling Asset Management and Trustees Limited, Dr Patrick Ejumedia, says the oil sector will continue to drive Nigeria’s economy despite efforts to increase non-oil exports.
Speaking during an interview with ARISE News on Tuesday, Ejumedia said Nigeria must significantly increase its non-oil exports if the country is to reduce its dependence on the oil sector.
“Until we do that, we’ll continue to have the oil sector driving the economy.”
Ejumedia said Nigeria’s export figures highlight the significant contribution of crude oil and refined petroleum products to the country’s total exports.
“If you add that 10 point something trillion to the 12 trillion that oil export did, that would be about 23 trillion. So that makes you say that, yes, it’s an oil story.”
He, however, said that while crude oil production and refined petroleum production are increasing, non-oil exports have also recorded significant growth.
“The non-oil related products had the highest growth of about 22 percent.”
On the impact of the Dangote Refinery, Ejumedia said the facility is changing the structure of Nigeria’s trade by increasing domestic refining and reducing the country’s dependence on imported refined petroleum products.
“That is changing the structure of our trade.”
He explained that Nigeria is increasingly producing crude oil, refining some of it domestically for local consumption and exporting refined petroleum products to other markets.
“So we consume a large amount domestically, then we then export others.”
Ejumedia said the focus should now be on creating a favourable market that will encourage more investors to enter the refining sector and strengthen domestic petroleum production.
“The major issue is making the market so friendly that other producers can also come in.”
He added that Nigeria’s growing refined petroleum exports to neighbouring West African countries could further strengthen the oil sector’s contribution to the economy.
“Once we are refining significant amounts, we can then begin to export. And of course, we begin to export to the neighboring countries first.”
Goodness Anunobi
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