This is the right time to build a viable and sustainable bridge between Canada and Nigeria, using global trade and investment as drivers. This bridge should enable Nigerian and Canadian companies to jointly develop and commercialize products and services that satisfy the needs of potential buyers around the world.
Today, the Canada-Nigeria trade relationship is the result of limited thinking. Thinking about Canada as a market for more Nigerian fossil oil, cocoa and fruits is too limiting. Likewise, thinking about Nigeria as a market for Canadian cereal, beverages and vehicle parts is just as limiting.
A new mindset is required. What should drive thinking of this trade and investment relationship is the portfolio of opportunities that companies in both countries can jointly exploit to satisfy the needs of potential customers worldwide.
There are areas where Nigeria has significant resources and Canada has considerable experience and competence. These are areas where companies in the two countries can collaborate for mutual benefit, using business models that work in a digital and global dispensation.
Nigeria is the largest economy in Africa with a GDP of approximately US $450 billion. It also has the largest population on the continent at 207 million. Almost one in every five Africans is a Nigerian.
Add to that the fact that Nigeria has the seventh largest population in the world and is expected to have the third largest by 2050. Nigeria has a labour force of more than 100 million that is skilled, trainable and inexpensive, making it an attractive resource worthy of investment to address the needs of global markets.
Nigeria has a large young population (the median age is 18.1) that is tech-savvy and the country ranks eighth globally in terms of internet penetration.
Nigeria ranks ninth in most available arable land in the world, most of which is uncultivated. Among the diverse crops grown in Nigeria are the following: cocoa beans, groundnuts, yams, cassava, palm kernels, maize, rice, sorghum, gum arabic, bananas and ginger. Nigeria has the potential to develop a very successful livestock sub-sector and has 44 solid minerals in proven commercial quantities, including gold, iron ore, lead and zinc, barite, tantalite, bitumen and coal. Mining contributes less than 0.1 per cent to Nigeria’s GDP.
Between 2015 and 2019, Nigeria was one of Canada’s top-three trading partners in sub-Saharan Africa. The total value of imports from Nigeria was $4.4 billion, with fossil fuels accounting for an overwhelming 96 per cent. The total value of Canadian exports to Nigeria over the same five-year period was $2.2 billion, with cereals and beverages along with motor vehicles and machinery accounting for 93 per cent of those exports. In 2019, the value of what Canada imported from Nigeria was around $295 million while the value of what Canada exported to Nigeria in 2019 was $505.6 million.
The value of two-way trade between the two countries in 2019 was $800.3 million. To put matters in perspective, this figure represents 17 hours’ worth of trade between Canada and the U.S., so while Nigeria may be a top trading partner for Canada in sub-Saharan Africa, this does not translate to a significant amount of trade in real terms and it speaks to Canada’s relative absence on the African continent.
Total Canadian direct investment in Nigeria in 2019 was $390 million, while total Nigerian direct investment in Canada in the same year was $934 million. Nigeria’s investment in Canada was 2.4 times Canada’s investment in Nigeria. In the first seven months of 2020, Canada’s exports to Nigeria represented 0.1 per cent of its total exports and Canada’s imports from Nigeria during the same period represented 0.1 per cent of its total imports.
This article seeks to advance the notion that it’s time for Canada and Nigeria to have a new mindset about what Canada means to Nigeria and what Nigeria means to Canada. This new mindset should be driven by efforts between Nigerian and Canadian companies collaborating to satisfy the needs of consumers in their countries and in global markets.
Adeyinka Asekun is the high commissioner for Nigeria. Reach him at (613) 564-0077 or email him at chancery@
nigeriahcottawa.ca.
