ANALYSE OF THE TRADE AGREEMENT BETWEEN BUHARI AND TRUMP

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ANALYSE OF THE TRADE AGREEMENT BETWEEN BUHARI AND TRUMP

President Muhammadu Buhari was hosted by U.S. President Donald Trump at the White House to discuss issues, including fighting terrorism and economic growth. Buhari, during the one-day official working visit to the U.S. at the invitation of Trump, have bilateral meeting with the U.S. president and a working lunch. President Trump discussed ways to enhance strategic partnership and advance shared priorities between the two countries: promoting economic growth and reforms, fighting terrorism and other threats to peace and security, and building on Nigeria’s role as a democratic leader in the region.

“The relationship of the United States with Nigeria is deep and strong, and Nigeria’s economic growth, security, and leadership in Africa will advance our mutual prosperity,” the White House said. International affairs experts say Buhari’s U.S. visit is strategic in many fronts, especially in view of the fact that the Nigeria-U.S. relationship was not too good prior to the inauguration of Buhari as president. They say Buhari, being the first democratically-elected African President that would be hosted by Trump since his inauguration and also being the first African leader Trump spoke to on phone following his inauguration as the U.S. president, speak volume.

It is also noted that former U.S. Secretary of State Rex Tillerson visited Nigeria in March in a first five-country African tour embarked upon by any official of the Trump administration. These historic events, the experts say, apart from reaffirming Nigeria’s strategic position in Africa, raised a lot of expectations and opportunities during the visit. The Special Adviser to Buhari on Media and Publicity, Femi Adesina, highlighted some of the expectations and opportunities.

The meeting discussed ways to enhance the strategic partnership between the two countries and to advance shared priorities, such as promoting economic growth, fighting terrorism and other threats to peace and security. The meeting further deepens the U.S.-Nigeria relationship as the United States considers Nigeria’s economic growth, security and leadership in Africa to be critical aspects of their strategic partnership. Later in the day, President Buhari met with a group of business persons in agriculture and agro-processing, dairy and animal husbandry,”

The presidency said the Nigerian officials met with Boeing, the largest aircraft manufacturer in the world, on the National Carrier Project. On agriculture, the Nigerian delegation also met with large equipment manufacturers with focus on harvesting and post harvesting equipment. In the area of transportation, the officials met with the GE-led consortium for the implementation of the interim phase of the narrow gauge rail concession. A substantive concession agreement will be negotiated and finalized, to provide the consortium the opportunity to invest an estimated two billion dollars, to modernize the rail line from Lagos to Kano and from Port Harcourt to Maiduguri.

In addition, the concession framework and the interim phase framework agreements are expected to be signed during the visit. The Nigerian officials will also meet with U.S.-EXIM Bank and the U.S. Overseas Private Investment Corporation to explore competitive financing arrangements. U.S. Ambassador to Nigeria, Stuart Symington, said the Buhari-Trump meeting “will be a very high level meeting; it will help the U.S. to also understand Nigeria’s projection”.

There was independent conversation on security, governance, the Lake Chad Basin and Nigeria’s role as a democratic leader in the region,’’ Symington said. Nigeria’s Minister of Information and Culture, Alhaji Lai Mohammed, also described the visit as a sign of the growing cooperation between the U.S. and Nigeria and there were independent conversation on security, governance, the Lake Chad Basin and Nigeria’s role as a democratic leader in the region.”

The Trade Agreement Sign between the Two Presidents

“The meeting between President Trump and President Buhari centred majorly on security and the economy. President Buhari visit to Trump is quite important because it is going to offer the opportunity for the two countries to reset their ties. Probably the fact that the world is now understanding that Nigeria is very strategic not just to the sub-region but the entire Africa.  

Amb. Hakeem Balogun, Nigeria’s ambassador to Indonesia, sees a very positive outing, saying the Nigeria-U.S. relation has improved greatly since Buhari became president and described the relationship as “very warm”. Prior to President Buhari’s ascendancy, the relationship was sort of lukewarm following the American’s complaints over Nigeria’s handling of security issues, human rights allegations, issues of corruption, issues of governance. These are issues which the present government has come in to make the focal point of its administration. And no doubt, even since then, the relationship has been very robust.

Trump underscored the importance the United States places on its relationship with Nigeria, and he expressed interest in working with Buhari to expand the strong partnership. The leaders agreed to continue close coordination and cooperation in the fight against terrorism in Nigeria and worldwide. Trump thanked Buhari for the leadership he has exercised in Africa and emphasised the importance of a strong, secure, and prosperous Nigeria that continues to lead in the region and in international forums. Balogun also said Buhari’s visit would be a win-win for both countries considering Nigeria’s ability to rally Africa on any issue at the international stage, a diplomatic advantage, which U.S. desperately needs. The U.S. recognises Nigeria as the leader on the continent. It shows that if they (U.S.) have to have a foothold in Africa or to do something in Africa, anything positive, they need the support of Nigeria.

TRADE

Nigeria is America’s 56th largest goods trading partner. The US exported goods worth USD$1.9 billion in 2016, and imported goods worth USD$4.2 billion that year, leaving the US with a trade deficit of USD$2.3 billion with Nigeria. But these numbers are deceptive because US imports are made up mainly of crude oil. Stripping out the oil, the US would have had a trade surplus of USD$1.7 billion in 2016. To alleviate poverty and create jobs Nigeria needs to export more non-oil products to the US. At the very least, Buhari should press Trump to strengthen the African Growth and Opportunity Act (AGOA) enacted in 2000 to facilitate the access of African exporters to the US market. Nigeria was the leading AGOA exporter in 2016, with over USD$2 billion worth of exports under the Act.

There are fears that Trump might jettison the Act, or weaken some of its provisions that he deems inimical to his “America First” philosophy. Buhari should defend it unequivocally. And he should tell Trump that Nigeria needs more US foreign direct investment. In 2016 the number was USD$3.8 billion in 2016, far less than the USD$13 billion the Chinese invested in Nigeria in the same year.

There are a lot of cooperation such as the commercial and investment dialogue which we have signed with the U.S. Secretary of Commerce Wilbur Ross. “It is really focused on how to deepen the commercial relationship in support of businesses from the two countries as well as the growing trade in a win-win partnership,’’ Enelamah said. Enelamah said that the U.S. businesses operating in Nigeria were looking for a way to increase their investments to improve production and create employment. “There is the big one – the 2 billion-dollar investment – to revamp our existing rail and making sure it is used for cargo and transport. “That is the narrow gauge and the exiting rails we have in addition to all the new ones we have and that is just one investment from one company. “Some of the companies which authorities Buhari had met with included John Deere for assembling and supplying tractors in Nigeria. He said that the company would train, employ people and help the agriculture value chain in terms of mechanisation and automation, among others. The minister said that other multi-million dollar companies such as Cotava and Continental Grains, among others, were committed to making serious investments in Nigeria that would run into billions of dollars. “Boeing is very interested in supporting the aviation sector; it plans to roll out something that will increase the availability of flights from Nigeria while Procter & Gamble is looking to expand its investment in Nigeria. “So, in terms of investment and commitment, there is every reason to be positive, it is certainly in billions of dollars, we need to sharpen our pencils and take it on. “I was encouraged by the level of engagement, commitment and frankly, the way people perceive and assess the opportunities; I think it’s good we had the blessings and the endorsement of the two presidents.

The Trump administration showed commitment and the general impression that it would support what the Nigerian government was doing. Nigeria is gaining a lot; in the area of security, as the American Government is not only selling Tucano helicopters to Nigeria, they’re going to follow it up with training and other assistance. It is also seen that Trump’s commitment (US) would now focus on the agriculture sector in its assistance to Nigeria. In the same vein, Gov.

BUSINESS AS USUAL

The US-Nigeria relationship has historically been driven less by economics, but more by convenience and indifference. While Nigerian presidents covet a visit to the White House, US presidents tend to be indifferent, and sometimes passive, about Nigerian affairs. An example is the blind eye various US administrations turned as successive military dictators presided over Nigeria for three decades. Some of those dictators managed to stash their ill-gotten wealth in US financial institutions.

One can hardly predict the outcome of the trade agreement between country as previous experience were nothing to write home about. However, going by the trade agreement, it looks very promising for both country, but Nigeria have more to do balance its export to United trade of America with non-oil exports.