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«Subsector Assessment of the Nigerian Hides and Skins Industry Prepared by: Chemonics International Inc. 1133 20th Street NW Washington, DC 20036 ...»

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To help revive agricultural growth, the Government of Nigeria (GON) requested USAID/Nigeria’s assistance to determine which agricultural products have the greatest potential to increase foreign exchange and create jobs. The GON is convinced that a realistic business plan to maximize Nigerian’s agricultural potential must be based on sound information, an analysis of what actually exists, and a clear understanding of the constraints in the sector that inhibit the GON and the Nigerian private sector from capitalizing on these opportunities.

Chemonics International is working with USAID/Nigeria and Government of the Federal Republic of Nigeria (GON) to meet these objectives. The following three-phase approach was

designed to achieve these objectives:

I. Assessment of the Global Market for Agricultural Products;

II. Evaluation of Nigeria’s Agricultural Sector; and III. Agricultural Industry Action Plans The final result will be the submission of a number of Industry Action Plans (IAPs) that will be implemented as part of a comprehensive agricultural competitiveness program that would be supported by USAID and other international donors as well as the international and Nigerian private sectors.

I. Assessment of the Global Market for Agricultural Products.

The first phase was a broad overview of the world market for agricultural products, including products that are currently, or potentially could be, produced in Nigeria. The global markets, including the Africa region, were evaluated using a rigorous methodology and evaluation criteria that was developed by consultants experienced in global markets for tropical agricultural products. For example, the set of criteria included existing consumer demand, trends in market shares, capital requirements, product distribution, commodity prices and volatility, financial returns, etc. The results of this assessment produced a prioritized list of the most promising global marketing opportunities for current and prospective Nigerian agricultural export products.

II. Evaluation of Nigeria’s Agricultural Sector: “The Agriculture Commodity Summit.” In collaboration with the Project Coordinating Unit (PCU) of the Federal Ministry of Agriculture, and the Nigeria Export Promotion Council (NEPC), Chemonics International held a stakeholders’ summit on Nigerian agricultural exports in Abuja in January 2002. The summit was attended by more than two hundred participants and stakeholders who helped to identify and recommend, for further study in the Agricultural Industry Action Plans, those commodities that had the greatest potential for creating increased economic growth, external and internal trade, opportunities for employment and increased income and wealth for Nigeria.

Chemonics International Inc. 44 USAID PCE-I-00-99-00003-00 November 2002 Task Order No. 812 Facilitated by local and expatriate consultants, the summit pulled together local experts, stakeholders and public officials who jointly developed a comprehensive list of opportunities matching existing and potential Nigerian agricultural products with current and forecasted world demands. The summit combined completion of questionnaires (during the summit meeting) with the discussion of the rank-ordered list of commodities for domestic production and export potentials.

The summit also created a high profile public and private sector buy-in for this approach to agricultural competitiveness and demand for the “downstream” activities’ industry action plans, and possible constituencies/partnerships for the eventual implementation of the action plans.

From the summit, the following commodities were chosen for in-depth study:

1. Ginger

2. Gum Arabic

3. Sesame

4. Cashew

5. Leather/Skins

6. Marine Products (prawn farming) Following the summit, a team of consultants including expatriate and local industry experts conducted “validation visits.” These visits were to selected sites, and stakeholders (exporters, processors, producers, etc.) and were designed to confirm information and gather data necessary for preparing useful action plans.

III. Industry Action Plans

Industry Action Plans are being developed for the most promising commodities selected from the agricultural commodity summit. These action plans or “road-maps” will identify weak links in the commodity chain that limit competitiveness and suggest practical steps for overcoming them.

This analysis includes private and public sector individuals most active in the selected commodity. The plan will focus on actions for the private sector to follow, particularly individuals interested in establishing and/or expanding their presence in the export of Nigerian agricultural products. The action plan will also identify interventions appropriate for USAID and GON support to both increase and accelerate private sector agribusiness activity within the commodity chain.

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