VZCZCXRO7742
PP RUEHMA RUEHPA
DE RUEHUJA #2600/01 3551220
ZNR UUUUU ZZH
P 211220Z DEC 07
FM AMEMBASSY ABUJA
TO RUEHC/SECSTATE WASHDC PRIORITY 1687
INFO RUEHOS/AMCONSUL LAGOS PRIORITY 8438
RUEHZK/ECOWAS COLLECTIVE
RUEATRS/DEPT OF TREASURY WASHDC
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEAWJA/DEPT OF JUSTICE WASHDC
RHEBAAA/DEPT OF ENERGY WASHDC
RULSDMK/DEPT OF TRANSPORTATION WASHDC
RUEHRC/DEPT OF AGRICULTURE WASHDC

UNCLAS SECTION 01 OF 05 ABUJA 002600 
 
SIPDIS 
 
SIPDIS 
SENSITIVE 
 
DEPARTMENT PASS TO USTR-AGAMA, EXIM-JRICHTER, TDA-EEBONG 
TREASURY FOR PETERS AND HALL 
DOC FOR 3317/ITA/OA/KBURRESS, 3130/USFC/OIO/ANESA/ DHARRIS, AND 
USPTO - JKOEPPEN AND PSALMON 
DOJ FOR MKOUAME 
DOE FOR CGAY AND GPERSON 
DOT FOR MARAD 
 
E.O. 12958: N/A 
TAGS: ETRD ECON EFIN EINV EAID PGOV NI
SUBJECT: TIFA COUNCIL- U.S.-NIGERIA 
 
REF: A. ABUJA 2593 
      ¶B. ABUJA 2403 
 ¶C. ABUJA 2178 
 
SENSITIVE BUT UNCLASSIFIED - HANDLE ACCORDINGLY 
 
¶1. (SBU) Summary.  Following the Trade and Investment Framework 
Agreement (TIFA) Council meeting with the Government of Nigeria 
(GON), the U.S. and GON agreed on a work plan and joint-communique 
that paves the way forward for greater dialogue and engagement. 
Several GON officials expressed interest in discussing a bilateral 
investment treaty, and advisors from President Yar'adua's office 
hurriedly requested a sample U.S. BIT before the President's meeting 
with President Bush in Washington, D.C.  The GON expressed strong 
interest in U.S. investment in infrastructure and other areas, 
including manufacturing sectors linked to downstream processing of 
petrochemicals and other products.  The GON made no commitment on 
removing import bans reducing tariffs and the full implementation of 
the Economic Community of West African States (ECOWAS) Common 
External Tariff (CET).  The GON agreed that, in addition to the 
annual TIFA council meetings, there should be quarterly 
consultations to advance the work plan.  A team of USG officials 
also used the opportunity of the TIFA to hold a series of meetings 
on the important issue of improving Nigeria's protection of 
intellectual property rights and anti-counterfeit efforts.  End 
Summary. 
. 
TIFA COUNCIL AND AGOA WORKSHOP 
------------------------------ 
. 
¶2. (SBU) On December 11, in Abuja, the fifth TIFA Council meeting 
and an AGOA workshop took place.  The U.S. delegation was led by 
Florizelle Liser, Assistant United States Trade Representative for 
Africa and included members from the Departments of State, Commerce, 
Agriculture, and agencies ranging from the African Development 
Foundation to USAID, USAID West Africa Trade Hub, and the U.S. PTO. 
The GON delegation was led by Elizabeth P.B. Emuren, Permanent 
Secretary (PS) at the Ministry of Commerce and Industry (MCI). 
 
SIPDIS 
Although he was the host, MCI Minister Ugwuh arrived several hours 
after the start and promptly left one hour later.  Curiously his 
deputy, Minister of State Ahmed Garba Bichi, who was to chair the 
AGOA workshop, did not show up. 
. 
GON DELEGATION 
-------------- 
. 
¶3. (U) The members of the GON delegation were -- Engineer Charles 
Ugwuh, Minister for MCI, E. B. P. Emuren Permanent Secretary, MCI; 
Dr. Ochi C. Achinivu, Director of Trade, MCI; Jimmy Olumi, MCI; W. 
¶K. Amuga, MCI; B.G. Hamza, MCI; I. C. Ibeh, MCI; Alex Akpakpu, 
Nigerian Export Processing Zones Authority; Prince Joseph Idiong, 
Association of Nigerian Exporters; J. H. Badu, Nigerian Export 
Promotion Council; N. T. Igba, Central Bank of Nigeria; John O. 
Asein, Nigerian Copyright Commission; Grace O. Adeyemo, Nigerian 
Customs; B. U. Gimba, Nigerian Customs; M. T. Othman, Nigerian 
Customs; Gloria Esiaba, Ministry of Health; Fowu Bowade, MCI; 
Ifeanyi Mbah, MCI; A. A. Adigwe, MCI; I. N. Briggs, MCI; Udu-Ejembi, 
MCI; and E. E. Kalu, MCI. 
. 
USG/NIGERIA STRATEGIC ECONOMIC PARTNERSHIP 
------------------------------------------ 
. 
¶4. (SBU) In her opening remarks AUSTR Liser stressed that the TIFA 
Council meeting was an opportunity to explore common objectives, 
identify challenges, adopt a joint work plan that identifies 
priority areas for U.S.-Nigerian cooperation, and advance work on 
the WTO Doha Development Agenda.  The TIFA provides a joint 
mechanism to develop a concrete plan of action for deepening and 
expanding the $30 billion trade relationship.  The U.S. views 
Nigeria as a strategic partner, and currently the trade relationship 
is dominated by Nigerian petroleum and minerals exports.  The AUSTR 
contended that AGOA, coupled with domestic policy reforms, provides 
an opportunity to expand and diversify the relationship.  She noted 
that there are a number of market access issues that need to be 
addressed in order to advance the relationship.  In particular, 
Nigeria's import bans need to be addressed in order for Nigeria to 
 
ABUJA 00002600  002 OF 005 
 
 
maintain its current AGOA eligibility status. 
. 
NIGERIA'S PLAN FOR IMPROVED ECONOMIC PERFORMANCE 
--------------------------------------------- --- 
. 
¶5. (SBU)  Following opening remarks from AUSTR Liser, Permanent 
Secretary (PS) Emuren reported that the GON planned to continue 
 
SIPDIS 
macroeconomic, institutional and structural reforms, and create an 
atmosphere of zero tolerance for corruption.  PS Emuren stressed 
that the GON would focus on developing infrastructural facilities to 
support a manufacturing sector for both domestic and export 
industries.  It would expand free trade and special economic zones 
with the ultimate goal of Nigeria becoming one of the 20 largest 
economies in the world by the year 2020. 
. 
AGOA AND BILATERAL TRADE 
------------------------ 
. 
¶6. (SBU) AUSTR Liser highlighted that the $30 billion in two-way 
trade between Nigeria and the United States in 2006, was a 16% 
increase over 2005 and that U.S. total exports to Nigeria was $2.2 
billion in 2006, a 16% increase from 2005.  She noted that non-oil 
imports from Nigeria accounted for only $1.4 million, but had 
doubled since last year.  She emphasized that the USG wants to work 
with Nigeria to expand and diversify its non-oil trade, and that USG 
resources at the West Africa Trade Hub could be utilized. 
 
¶7. (SBU) The USG underscored several areas of concern -- Nigeria 
continues a system of high tariffs and import bans, despite Nigeria 
agreeing to implement the ECOWAS Common External Tariff (CET).  The 
USG contended that these tariffs and non-tariff barriers (NTBs) have 
a major impact on U.S. agricultural and manufactured product exports 
to Nigeria. 
 
¶8. (SBU) In response, Dr. Ochi Achinivu, MCI Director of Trade said 
Nigeria is committed to working on the issue of the import bans and 
tariffs.  He said that the Manufacturing Association of Nigeria 
(MAN) was lobbying the GON to keep the bans and high tariffs to 
protect Nigeria's infant industries.  In addition, MAN is pushing 
the 5th tariff band of 50 percent in order to protect local 
industry.  Director Achinivu opined that there were other methods to 
protect these industries through incentive schemes. 
 
¶9. (SBU) He reported that MCI has already notified President 
Yar'adua of USG concerns.  He also expressed concern that the bans 
and high tariffs were having a negative statistical impact on the 
Nigerian economy.  MCI had recommended to the President and Ministry 
of Finance that following the WTO regime was the best way forward 
and that GON is working on resolving these issues. 
 
¶10. (SBU) Several members of the GON asked the status of a Bilateral 
Investment Treaty (BIT) with Nigeria and Director Achinivu noted 
that a draft had already been sent to the GON and that GON welcomed 
discussions on a technical level. 
 
¶11. (SBU) The USDA/FAS representative expressed concern with 
Nigeria's use of arbitrary reference prices to assess duties on rice 
as well as Nigeria's use of irregular import valuation measures. 
According to the WTO, import values should be based on the actual 
transaction value of the good, not an arbitrary reference price.  As 
a member of the WTO, Nigeria's practices should be in-line with the 
Customs Valuation Agreement.  The Nigerian Customs officials said 
that a workshop on the Customs Valuation Agreement had been held and 
they expected implementation of the transaction value method of 
valuing imports, inline with WTO rules.  At the same time, Customs 
is waiting for passage of a bill that will legislate the change. 
The USG requested a draft copy. 
 
¶12. (SBU) The USDA representative invited the GON to participate in 
a trade mission scheduled for 2008 in Accra, where U.S. 
agribusinesses could meet with the GON and Nigerian companies to 
identify partners for potential business.  The AUSTR offered the 
services of the Animal, Plant, and Health Inspection (APHIS) expert 
that was based at the regional trade hub to provide guidance on 
exporting agricultural products to the U.S.  The GON expressed 
interested in being part of the trade mission and in working with 
 
ABUJA 00002600  003 OF 005 
 
 
the APHIS standards expert. 
. 
TRANSPORTATION/ENERGY/INFRASTRUCTURE 
------------------------------------ 
. 
¶13. (SBU) The AUSTR said she was very aware of the constraints that 
impacted the ability of all African countries to export their 
products due to problems with transportation, physical 
infrastructure and energy.  She noted that the new Delta Airlines 
service between Atlanta and Lagos is a sign of progress and 
commended Nigeria's privatization of ports and its goal of becoming 
a maritime hub for West Africa.  PS Emuren said infrastructure was 
the key limiting factor to the success of business in Nigeria. 
Director Achinivu added that everything made in Nigeria was 45% more 
expensive because of the electric power and tariff issues. 
 
¶14. (SBU) The GON contended that there are opportunities for U.S. 
investors to invest in providing infrastructure such as highways, 
and in petrochemicals and solid minerals sectors.  The USG asked for 
terms and conditions to be declared and the GON indicated readiness 
to work with the U.S. in analyzing the terms and conditions and 
identifying impediments to investment. 
 
¶15. (SBU) The GON inquired about technical assistance to assist 
project finance and the Econ Counselor answered that the U.S. Exim 
Bank has a proposal to work with USTDA to hold a seminar in Nigeria 
with bankers to discuss project financing.  The USG welcomed 
Nigerian input on who should be present for such a seminar.  Econ 
Counselor contended that, if the terms and conditions are right, 
U.S. investors would come to Nigeria and if the MCI wished to pull 
together key actors on the Nigerian side to look at conditions for 
investment, the USG would do the same. 
. 
INTELLECTUAL PROPERTY RIGHTS - MORE INPUT NEEDED 
--------------------------------------------- --- 
. 
¶16. (SBU) MCI officials contended that a good IPR regulatory 
framework was in place, however, investment from the film and music 
industries was not forthcoming.  In response AUSTR Liser commented 
that a major impediment to investment was IPR violations, and that 
Nigeria is the largest market for pirated products.  PS Emuren 
explained that IPR was a major issue that the GON wanted to improve, 
and the GON needed assistance on following international standards. 
PS Emuren also asked for assistance in initiating a copyright 
registration scheme, and for USG comments to the optical disk 
registration law passed in Dec. 2006.  USTR responded that the USG 
would provide comments on the law and suggested Nigeria adopt the 
WTO WIPO International Treaty. 
 
¶17. (SBU) GON officials indicated Nigerian rights holders had 
complained of IP violations in the United States regarding the 
pirating of Nigerian movies online and unlawful duplication.  USTR 
responded that the USG welcomed any information that was available 
about the violations, that the USG does not support piracy and there 
are methods in place that the rights holders, could use to take down 
the websites.  They lamented that when the movie and music producers 
pulled out of Nigeria, they left a vacuum, and if they were to come 
back they could partner with the GON to reduce piracy.  USTR 
contended that the vacuum in the music and movie industry is an 
issue that would be resolved when the rights holders saw more 
examples of the GON enforcing IPR rules. 
 
¶18. (SBU) The GON IPR officials complained that the more the GON did 
to protect IP, the more the U.S. wanted them to do.  The GON 
reported a draft bill from the IP Commission was being put together 
to help close holes in the current legislation and that public 
awareness was low.  The GON asked for assistance in creating this 
awareness, and the USG offered to assist. 
. 
TRADE CAPACITY BUILDING - GON WANTS MORE 
--------------------------------------- 
. 
¶19. (SBU) The USG outlined current trade capacity building 
assistance to Nigeria from the following agencies:  Export Import 
Bank (Exim), the Overseas Private Investment Corporation (OPIC), the 
United States Trade and Development Agency (USTDA), USAID/WA, USAID, 
 
ABUJA 00002600  004 OF 005 
 
 
the African Development Foundation (ADF), and the United States 
Department of Agriculture (USDA). 
 
¶20. (SBU) The GON listed the following as areas where TCB is 
needed: 
-- Establishing a trade database. 
-- Training for staff of the MCI's trade department on the use of 
statistical software for various analyses. 
-- Training on trade negotiations. 
-- Training on impact assessments of various trade policies. 
-- Equipment for calibration, weights and measures of products such 
as oil and gold. 
-- Internet Access and VSAT link between the Ministry and its state 
offices. 
The USG agreed to review the requests for possible assistance, but 
made no commitments. 
 
¶21. (SBU) The GON also expressed interested in capacity building 
opportunities offered by the Trade Hub and USAID, because the GON 
wanted to increase their value added products.  Nigeria's private 
sector rep was particularly concerned with the phytosanitary issue 
(SPS) and requested that a TIFA working group identify technical 
assistance that could be given to Nigeria. 
. 
DOHA 
---- 
. 
¶22. (SBU) AUSTR Liser pointed out that the GON's positions on Doha 
hurt its interests, and asked why the GON continues to support these 
positions.  She questioned the Less Developed Countries (LDCs) 
position that all LDCs should have duty free and quota free (DFQF) 
access to Europe and the United States.  The AUSTR explained that 
Nigeria (not an LDC) and other African countries (both LDC and 
non-LDCs) have this through AGOA and questioned Africa's push to 
extend AGOA-like preferences to countries like Bangladesh that are 
much larger exporters.  She urged Nigeria to review its current 
positions in-line with its own national interests.  Addressing this 
issue, Director Achinivu stated that agricultural subsidies needed 
to be reduced as did tariff rates on non-agricultural market access 
(NAMA) products, and that Nigeria is aligned with the G20.  He 
praised U.S. moves to address agricultural subsidies, but said that 
the EU, particularly France, was not doing enough.  He reiterated 
that Nigeria would continue to cooperate with the U.S. on WTO 
issues. 
 
¶23. (SBU) The GON asked if the U.S. was still pursuing a WTO waiver 
for AGOA and what the status was on a draft bill in Congress that 
intended to give LDC countries AGOA-like benefits.  Regarding the 
WTO waiver for AGOA countries, USTR reported it is still in the 
negotiations stage, and China has informally agreed not to oppose 
the waiver, but some other countries, such as Paraguay, continue to 
oppose the waiver approval.  USTR answered that a draft LDC bill has 
not been passed and a vote was not expected until early 2008. The 
AUSTR reported that the African embassies in Washington, D.C. will 
be consulting with Congress on the bill. 
 
JOINT-COMMUNIQUE - GOOD PROGRESS 
-------------------------------- 
. 
¶24. (SBU) In the joint communique issued after the TIFA Council 
meeting both sides agreed to explore common objectives, including 
cooperation in the World Trade Organization, commercial issues and 
trade restrictions, trade capacity building and technical 
assistance, intellectual property protection and enforcement, export 
diversification, and infrastructure and other investment issues. 
The communiqu urged the GON to continue its efforts to reduce 
tariffs over time and convert existing import bans to tariff 
structures. 
 
¶25. (SBU) Both sides will work towards clarification of procedures 
for temporary import licenses for oil service equipment and other 
short term remedies as well as a long term solution, to ensure 
support for petroleum exploration and development.  On AGOA, the two 
sides agreed to focus on specific product areas with export 
potential for Nigerian review and discussion with USAID West Africa 
Trade Hub experts.  Addressing the current WTO Doha negotiations, 
 
ABUJA 00002600  005 OF 005 
 
 
the U.S. and Nigeria agreed to work towards the successful 
completion of a broad and balanced final agreement. 
 
¶26. (SBU) The two countries agreed to form a working group to 
identify the terms and conditions necessary to attract investment in 
these areas.  The U.S. will continue to assist with efforts to 
develop electric power, including through a seminar for the Nigerian 
banking community on project financing models.  Nigerian officials 
also expressed interest in discussing a bilateral investment treaty 
(BIT) and said they would provide comments on the U.S. Model BIT 
presented at the last Council session. 
 
¶27. (SBU) In the area of intellectual property rights, the two sides 
agreed on new areas of cooperation, including improving enforcement 
against piracy and counterfeiting.  The U.S. applauded Nigeria's 
issuance of optical disc regulations.  The Nigerian side welcomed 
comments on these regulations as well as on its draft intellectual 
property legislation.  Nigeria requested information on an IPR 
recordal system to improve border enforcement. 
. 
CONCLUSION 
---------- 
. 
¶28. (SBU) The Council agreed to form a working group to meet 
quarterly to accelerate its work, and to finalize a work plan for 
¶2008.  The AUSTR urged Nigeria to continue to look at the business 
environment regulations that affected trade - tariffs, import bans, 
IPR, licensing, and customs reforms.  She reaffirmed the USG's 
commitment to working with Nigeria through the TIFA and other 
mechanisms to strengthen and diversify U.S.-Nigeria trade and 
investment. 
 
¶29. (SBU) PS Emuren underscored that the meeting had touched on a 
lot of issues and that there would be a report from each 
participating agency.  She hoped that the quarterly collaboration 
would allow Nigeria to learn more and be better informed on the full 
range of trade and investment issues discussed at the TIFA Council 
meeting. 
. 
COMMENT 
------- 
. 
¶30. (SBU) Overall, the TIFA Council meeting was successful in 
committing the GON to review areas of friction between the U.S. and 
Nigeria and creating an ongoing mechanism under the TIFA for 
accomplishing the work plan.  The quarterly consultations will 
assist the USG in prodding the GON to act on previous commitments 
and continue a cooperative dialogue.  The joint-communique provides 
a good foundation for that dialogue and was drafted near the end of 
meeting due to a push from the President's office to have one prior 
to his trip to the U.S.  Previously, MCI had rejected the need for 
it. 
 
¶31. (SBU) Minister Ugwuh's slight participation was unfortunate and 
PS Emuren being new to MCI limited her ability to play a leading 
role.  Surprisingly, the Ministry of Finance (MINFIN) did not attend 
the meeting and only offered to meet with the AUSTR to discuss the 
import bans and customs issues when schedules no longer allowed for 
a meeting to take place. 
 
SANDERS