People & Money

UK to Cut Tariffs on Nigerian Exports from April 2023

The UK will cut tariffs on imports coming from Nigeria. Ben Llewellyn-Jones, Deputy British High Commissioner to Nigeria, said this at Lagos’s launch of the Developing Countries Trading Scheme (DCTS). The scheme which is expected to kick off in April 2023 is expected to increase the trade volume between Nigeria and the UK. In 2022, the trade volume between Nigeria and the UK hit £2.2 billion. 

According to Llewellyn-Jones, “ The UK Government has reduced the tariffs of 90 percent of goods that Nigeria would export to our country and has also provided a preferential trading scheme for a range of other exports that the country might have.

“We have reached out to small and large businesses in different parts of the country and this is intended to help exporters and other people in the trading business to make the United Kingdom an export destination.” He added. 

He also spoke about the trade volume between Nigeria and the UK, and according to him, oil and gas accounted for the bulk of trade activity. Emphasizing increasing non-oil trade between both countries. He said, “We have to change focus to the non-oil sector but this takes time, but we are working with experts from Nigeria Export Promotion Council and the Federal Government to grow the economy through expanding of its export.

“The key challenges for exporters are finding key partners in the UK to sell their products but we are working on ensuring that we link exporters with potential buyers so as to ensure there is enough demand and supply.” He added. 

About Developing Countries Trading Scheme (DCTS)

The Developing Countries Trading Scheme (DCTS) is aimed at improving access to the UK market for developing countries. The scheme is targeted towards 47 countries that are under the Generalised Scheme of Preferences (GSP) Least Developed Countries (LDC) framework, and 18 countries classified by the World Bank as lower-income and lower-middle-income countries.

The provisions of DCTS include reduced import tariffs on goods from the shortlisted countries and cutting red tape around imports from lower-income and lower-middle-income countries. The scheme is also expected to lower costs for UK businesses as well as lower prices for consumers across a range of everyday products. 

Speaking during the launch of the scheme in Lagos, Mr. Simon Calvert, Senior Commercial Agriculture Adviser, Foreign Commonwealth, and Development Office (FCDO) stated that through the scheme, as many as 3000 products from Nigeria would be duty-free into the UK. He also stated that the average tariff on these goods was around 7%, and the scheme would make these goods more competitive in the UK. 

He stated, “Many tariff reductions are on value-added goods such as processed sesame oil, cotton clothing, and cocoa butter and paste and complement existing duty-free trade on raw products.

“We have made it simpler for Nigeria to get and retain these enhanced tariffs by removing the need for Nigeria to ratify and implement certain international conventions.”

This news comes even as the NEPC announces that non-oil exports grew in 2022 to $4.82 billion, a 39% increase from the previous year. The NEPC reports that non-oil exports reached their highest value since the council was founded 47 years ago. 

David Olujinmi

David Olujinmi studies Engineering but his true passion is research and analysis. He writes about finance, particularly the capital market, investment banking, and asset management. More »

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