Global Trade Alert

On 11 February 2014, Nigeria's president Goodluck Jonathan launched two intertwined projects: the National Industrial Revolution Plan (NIRP) and the National Enterprise Development Programme (NEDEP). The NIRP supports the development of a competitive advantage in the industrial sector while the NEDEP focuses on SMEs.
 
The trade discriminating features of both projects were highlighted during the president's speech in Abuja with the following quote: 'On our own part, the federal government will continue to support local manufacturers by buying vehicles that are made in Nigeria. And as long as those vehicles are produced in this country, the federal government will buy them. So we also encourage the state governments to support the patronage of made-in-Nigeria products in their states.'
 
Of the two projects, the NIRP which might have ultimately a considerable influence on trade flows as it supports big export businesses. The NEDEP only focuses on micro, small and medium enterprises (MSMEs), of which microenterprises represent the majority.
 
The NIRP was developed by the Federal Ministry of Industry, Trade and Investment in order to create jobs, maintain trade balance, boost competitive advantage and increase the current GDP of 4% to 10% over the next five years. The project will focus on three sectors where the ministry sees a potential comparative advantages: agriculture, solid minerals, as well as oil and gas. These three sectors are divided into six subsectors: palm oil, textiles and apparel, basic metals, automotive assembly, base petrochemicals, and plastics and rubber.
 
Amongst the various policies of the current two-year plan, there are measures with discriminatory and liberalizing characteristics, such as:

• subsidized long-term loans
• import substitution
• subsidized prices (e.g., for crude steel)
• adjusted tariffs in order to import capital goods for the manufacturing sector
• review of fiscal regime for exports
• comprehensive review of the Export Expansion Grant scheme

 
A state measure in the GTA database is assessed solely in terms of the extent to which its implementation affects the extent of discrimination against foreign commercial interests. On this metric, the state aid proposed here is discriminatory.