The Sea Empowerment and Research Centre (SEREC) has urged Nigeria to strengthen domestic production and competitiveness to address growing foreign competition in the country’s trading and distribution markets.
SEREC made the call in its policy bulletin titled “From Import Dependence to Production Power”, made available to newsmen on Thursday in Abuja by its Head of Research, Mr Eugene Nweke.
Nweke said the reported Sept. 15 protest by traders at the Lagos International Trade Fair Complex followed alleged increasing participation of Chinese businesses in direct retail and domestic distribution.
He said the development should be viewed as a strategic warning about changes in international commerce, competition and evolving global supply-chain dynamics affecting domestic businesses across Nigeria.
According to him, the traditional business model, in which foreign manufacturers produce goods, Nigerian importers bring them into the country, clearing agents process them, wholesalers distribute them and retailers sell to consumers, is increasingly being challenged.
He said the shift was driven by increasingly integrated global supply chains, allowing international businesses to participate directly in several stages of production, distribution and retail.
“Today, manufacturers and international businesses can combine production, financing, shipping, warehousing, digital commerce, distribution and retail in ways that reduce dependence on traditional intermediaries.
“This development is not exclusively a Chinese phenomenon. It is part of a wider transformation driven by globalisation, e-commerce, technology, logistics integration and increasingly sophisticated supply-chain management,” he said.
Nweke said the fundamental question for Nigeria was why local businesses continued to operate predominantly at the trading and distribution end of value chains in spite of the country’s market, resources and regional access.
“The fundamental question for Nigeria is not simply why foreign businesses are coming into our markets.
“The more important question is why Nigerian businesses are still operating predominantly at the trading and distribution end of value chains when Nigeria possesses the market, resources and entrepreneurial capacity necessary to produce.
“Nigeria also possesses the regional access necessary to add value, build brands and export,” he said.
He said Nigeria needed to transition from an economy disproportionately dependent on importation and resale to one driven by manufacturing, value addition, logistics, branding and exports.
The Nigerian consumer, he said, could not be blamed for choosing imported products where they were cheaper or more readily available than locally produced alternatives in the domestic market.
He identified energy, finance, infrastructure, transport, port efficiency, customs processes, taxation, technology, standards and logistics as factors affecting the competitiveness of domestic producers.
He called on the government to enforce laws governing immigration, business registration, taxation, customs, investment, competition and standards, while ensuring regulatory protection did not replace the need for competitiveness.
“Protect legitimate Nigerian enterprise while making Nigerian enterprise competitive enough to survive and expand,” he said.
Nweke urged importers to gradually move up the value chain through local assembly, packaging, components, finishing, contract manufacturing and Nigerian branding to strengthen domestic production.
He said the market knowledge accumulated by Nigerian traders constituted an important foundation for industrialisation, as they understood consumer demand, pricing, distribution, seasonal patterns and regional markets.
According to him, such knowledge can support the development of competitive manufacturing businesses and help traders transition into value-added production and export-oriented enterprises.
Nweke said Nigeria needed foreign capital, technology, expertise and international partnerships, but investments should create productive value through employment, training, technology transfer and local supply chains.
He urged stakeholders to view the market debate as a call for competitiveness rather than a conflict between foreign and Nigerian businesses, emphasising the need for productive transformation.
