EconomyHeadlines Group urges FG to settle exporters’ EEG backlog ahead of AfCFTA By maritimemag November 28, 202044 views ShareTweet 0 Peter Olaniyi | The Africa International Trade and Commerce Research (AITCR) has urged the Federal Government to settle outstanding claims of non-oil exporters to position the country well ahead of the African Continental Free Trade Area implementation. Mr Sand Mba-Kalu, the Executive Director, AITCR who made this known in Abuja in its export policy brief, said the exporters were being owed under the Federal Government’s Export Expansion Grant (EEG) Scheme. EEG was established through the miscellaneous and export incentive Act No.18 of 1986 as a government programme aimed at increasing volume and competitiveness of non-oil export through incentives granted to exporters in the country. He expressed dismay that the drawback in settlement of outstanding non-oil exporters ‘claims could hamper Nigeria’s chances of benefitting optimally from AfCFTA taking off in January 2021. Mba-Kalu said the Presidential Initiative Continuous Audit (PICA) recommended N195.09 billion as the outstanding EEG claims to be paid to 269 non-oil exporters that were owed from 2007 to 2016, which also received 8th National Assembly’s approval. According to the trade expert, the Federal Government instituted PICA in 2018 to review and make recommendation on the total outstanding claims under EEG that should be paid to non-oil exporters. He said that it was in a bid to settle the debt of N2.67 trillion being owed contractors, other creditors including state government, non-oil exporters and manufacturers. He recalled that Federal Executive Council also directed the Debt Management Office (DMO) to facilitate the entire process of settling the debt through Promissory Notes (PN) to all creditors over a ten years tenor. According to him, when the DMO released the modality for settling the obligations it stated that non-oil exporters will be issued Promissory Notes (PN), based on a Reverse Auction Process (RAP). He said that after PICA had concluded its national audit and made recommendation on the amount to be paid to non-oil exporters EEG claimant, DMO independently engaged services of KPMG to perform a desk audit of the claims. KPMG is a global network of professional firms providing audit, tax and advisory services. “Non-oil exporters were not consulted to defend their claims where there was miscalculation thereby exposing the claimants to potential loss of claims as a result of an error. “About 24 exporters had their claims significantly understated. These claims are still in contention in 2020, even though this process should not have been because PICA has concluded review in 2018,’’ he said. Mba-Kalu urged government to pay annual projection for EEG grants promptly to support non-oil exporters’ ability to make a sound projection for the year. He said that it should incorporate a system that would increase export volume of qualified non-oil exporters in Nigeria ahead of the first commercial AfCFTA contract slated to commence by Jan.1, 2021. Meanwhile, the Nigerian Export Promotion Council (NEPC) said it was working with relevant ministries departments and agencies for payment of N124 billion backlog of claims under the EEG scheme. Mr Lawal Dalhat, the Deputy Director, Incentives, NEPC NAN that EEG claims between 2007 and 2016 had been cleared, while the backlog from 2017 till date were being reviewed under the scheme. “Over 1,415 exporting companies were shortlisted, 308 companies were qualified, while 270 were approved by National Assembly with N195 billion claims. The remaining 38 companies out of the 308 companies have N124 billion. “We have gotten positive response that the Ministry of Finance, Budget and National Planning is actually working to secure approval by FEC and hopefully move it to National Assembly to settle debts for the remaining companies,” he said. AITCRL is a trade and investment promotion organisation that dwells on international trade research, import and export consultancy and infrastructure investment services. © 2020, maritimemag. All rights reserved.