Russian carmakers will have an advantage when entering the Nigerian market due to the planned transfer of the country’s fleet of vehicles to gas engines, Russia’s Trade Representative in Nigeria, Maxim Petrov has said.
“Almost all Russian carmakers that produce freight, as well as medium commercial and passenger vehicles, show interest in the Nigerian market,” Mr Petrov told the Russian news agency, TASS.
“Considering the plans of Nigerian President Bola Ahmed Tinubu’s administration on accelerated transfer of the country’s fleet of vehicles to gas, our producers can tap a substantial market share,” he added.
That said, the trade envoy considers it too early to speak about the launch of assembly lines of Russian car concerns in the African country. “First we should learn to work on the Nigerian market, solve logistics and service issues, reach certain sales volumes,” he noted.
Auto production in Russia slowed after major automakers exited and Western governments imposed debilitating sanctions on Moscow in response to its invasion of Ukraine.
Russia’s automotive production plummeted from around a million cars annually to just 3,000 cars in July of the first year. The industry, which had relied heavily on European Original Equipment Manufacturers (OEMs) for up to 60% of its parts, faced a near-total shutdown as self-imposed sanctions disrupted the supply chain and halted production in Russia.
The sector has since recovered and is on track to return to its pre-war production levels. There are changes in the sector though, with China becoming the primary supplier of exported cars to Russia. Additionally, many Western car production factories in Russia have been taken over by Russian entrepreneurs or joint ventures, often continuing to produce the same brands as before, despite the intellectual property rights held by leading global car companies.
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He said that Nigeria may provide tax exemptions for import of commodities and equipment from Russia, including in the area of production of fertilizers, motor transport and LNG.
“Following the April meeting with Minister of Industry, Trade and Investment Doris Uzoka-Anite the Nigerian side determined the following areas of cooperation with Russia: organic and inorganic fertilizers, motor transport, liquefied natural gas,” he said.
“The minister expressed readiness of the Nigerian side to consider investment projects in a targeted way in the mentioned areas with Russia’s participation under condition of at least partial production localization on Nigerian territory and to ensure import incentives for supply of equipment and commodities, as well as the possibility of tax holidays.”
In January, 34,000 tons of potash were supplied from Russia to Nigeria as a humanitarian fertilizer shipment. Uralchem has contributed over 134,000 tons of fertilizers to African nations free of charge since late 2022. More than 111,000 tons of the group’s humanitarian shipments were sent from the EU’s ports and warehouses facilitated by the UN program to Zimbabwe, Kenya, Malawi.
Mr Petrov said the first container supplies of cocoa beans from Nigeria to Russia are expected in September-October.
“The leading Russian chocolate producers have already tested Nigerian cocoa beans by now, being satisfied with the quality. We expect the first container batches in the autumn (September-October) cocoa harvest,” he said.
Supplies will be provided by Russian trading firms that already export frozen fish, chocolate, alcohol and meat to Nigeria, Mr Petrov noted, adding that three such trading firms registered by Russian entrepreneurs in the Nigerian jurisdiction already operate.
Commenting on anti-government protests that broke out in Nigeria this month, the trade representative also said that Russia’s Economic Development Ministry is working on update of the document on protection of Russian investments in Nigeria,
“The agreement on mutual protection and promotion of investment is the document defining the mechanism of protection of Russian investments in Nigeria. The work on its update is currently being done by the Russian Economic Development Ministry,” he said.
Anti-government rallies started on August 1 in Nigeria, with demonstrators protesting against growing food and fuel prices.
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