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Cablegate: Nigeria: Ustda Visit Elicits Gon Assistance Requests

VZCZCXRO6731
PP RUEHMA RUEHPA
DE RUEHUJA #1082/01 1631516
ZNR UUUUU ZZH
P 111516Z JUN 08
FM AMEMBASSY ABUJA
TO RUEHC/SECSTATE WASHDC PRIORITY 3076
INFO RUEHOS/AMCONSUL LAGOS 9399
RUEHZK/ECOWAS COLLECTIVE
RUEATRS/DEPT OF TREASURY WASHDC
RUCPDOC/DEPT OF COMMERCE WASHDC
RHEBAAA/DEPT OF ENERGY WASHDC
RUEHRC/DEPT OF AGRICULTURE WASHDC

UNCLAS SECTION 01 OF 02 ABUJA 001082

SENSITIVE
SIPDIS

DEPT PASS TO USTR-AGAMA AND USTDA FITTS/MARIN
TREASURY FOR PETERS AND HALL
DOC FOR 3317/ITA/OA/KBURRESS & 3130/USFC/OIO/ANESA/DHARRIS
USDA/FAS FOR ASIF CHAUDRY, DOROTHY ADAMS

E.O. 12958: N/A
TAGS: ETRD ECON EINV ENRG EAGR EAID ELTN NI
SUBJECT: NIGERIA: USTDA VISIT ELICITS GON ASSISTANCE REQUESTS

REF: A. ABUJA 760

B. ABUJA 411
C. ABUJA 402

1. (U) Summary: During May 5-12 meetings with U.S Trade and
Development Agency (USTDA), Nigerian government (GON) officials
expressed interest in USTDA providing technical assistance centered
on sustainable capacity building, technical training, international
standards development, guidance on essential public-private
partnership frameworks, performance-based contracting/procurement,
and strong requests for U.S. contractors, goods and services. End
Summary

2. (U) From May 5-12, 2008 a USTDA team comprised of Lida Fitts and
Paul Marin and accompanied by EconOffs met with Odein Ajumogobia,
Minister of State for Energy (Petroleum); Chief Sarafadeen Tunji
Isola, Minister of Mines & Steel Development; Hajia Fatima Balarabe
Ibrahim, Minister of State for Energy (Power) (Ambassador Sanders
attended these sessions); Irene Chigbue, Director General of the
Bureau of Public Enterprises; and representatives at the Ministry of
Commerce and Industry (MCI), Ministry of Transportation (MT), the
World Bank (WB), Nigerian Stock Exchange (NSE), and Civil Aviation
Authority (NCAA) to discuss potential areas of technical assistance.


Ministry of Commerce and Industry
---------------------------------

3. (U) On May 6 the USTDA team and EconOffs met with Ministry of
Commerce and Industry Trade Director Abikoye to discuss potential
projects. The officials of the ministry highlighted current
initiatives and needs of the ministry to include expanding non-oil
exports for products that have export market potential; development
of industrial clusters; and development of enterprise zones. The
TDA team showed an interest in better understanding the non-oil
export opportunities, like cassava and shea butter. Director
Abikoye invited the TDA team and EconOffs to visit a pilot
production plant near Abuja. The Ministry officials also
highlighted the need for training in trade negotiations and
upgrading of the Abuja Commodities Exchange to meet international
standards.

Cassava Plant - Not Yet Ripe
----------------------------

4. (U) On May 7 the USTDA team and EconOffs traveled with
representatives from the Ministry of Commerce and Industry to a
pilot project cassava production in Nassarawa state. The cassava
production plant and adjoining 87 hectare cassava farm were created
as part of the Cassava Initiative (CI), which focuses on increasing
cassava production and uses, including exports.

5. (U) A road to the plant/farm site had not yet been built,
although we were told Nassarawa state officials promised it would be
complete in 2007. The team expected to visit an operating cassava
plant, but upon arrival only a dog, several chickens and security
guards greeted the USG visitors. There were also no electricity
lines leading to the plant. EconOffs observed zero construction
activity, unfinished buildings without floors, and missing roofs.
There was a new electric generator and borehole for access to water.
We were informed that a local manufacturer is ready to deliver the
cassava processing equipment when the plant's infrastructure is
complete. Despite these shortcomings CI reps explained that the
plant would be up and running within three months. When the plant
is running, more than three tons of cassava per day will be
processed. The plant will focus on producing high-grade flour,
pellets, chips and gari.

6. (U) The CI received 20 million naira (US$170,000.00) funding for
the construction and equipping of the plant in 2006. However, the
funds have been spent and there is no funding from the current GON
budget for the plant's operation. When asked what will happen next,
CI reps contended that funding will be found by the GON or the
private sector will take over the plant. The CI reps asked the USG
for assistance in completing the project.

Meeting with Nigerian Stock Exchange
------------------------------------

7. (U) Nigerian Stock Exchange (NSE) General Managers Binos Yaroe
and Uzoma Onyekuru discussed the on-going USTDA-funded technical

ABUJA 00001082 002 OF 002


assistance project to integrate the Ghana and Nigerian stock
exchanges. Due to interest from other countries, the project will
also lay groundwork for a common stock exchange market with a
harmonized operation strategy for West Africa. This integrated
market would include countries with or without domestic stock
exchange markets, and offer a common trading platform, uniform
listing rules, and consistent membership regulations. NSE had
invited several countries to participate in regional planning, but
is working with only Sierra Leone at this point. The report for the
project, sponsored by USTDA, is expected to be complete by the end
of 2008. This report will provide an assessment of the start-up
capital and technical requirements and serve as a guidebook for the
next phase of physical integration. Exchange officials requested
USTDA's assistance in obtaining contacts at U.S. stock exchanges to
learn about the procedures for demutualizing the exchange.

Meeting with Civil Aviation Authorities
---------------------------------------

8. (SBU) Harold DeMuren, Director General of the Nigerian Civil
Aviation Authority (NCAA), sought assistance in instituting a
meteorology system, improving the air traffic control system, and
developing aviation human capacity. DeMuren said weather had a role
in every civair accident in recent years and the Nigerian civil
aviation lacks adequate weather forecasting. On air traffic control
and communication, Nigeria is limited to search and recovery, not
search and rescue, because it does not have the capability to locate
an aircraft in time for rescue. Describing Nigeria's aviation
communication system as "absolutely dead", he said the current
system must move from being ground-based to satellite-based. There
is an "acute shortage of skilled manpower" in the civil aviation
sector, DeMuren shared. Four NCAA-trained staff members had left
for more lucrative offers by private airlines and other industries.


9. (U) Managing Director Richard Aisuebeogun, Federal Airports
Authority of Nigeria, made a comprehensive presentation on the state
of Nigerian airports, including airports and areas direly in need of
investment. Broadly speaking, investment is needed in
infrastructure rehabilitation, construction and expansion;
procurement of new equipment; institution of safety provisions;
construction of maintenance facilities; and security and safety
training. He also hopes to attract investment in the construction
and management of independent power plants (IPPs) around the
airports as a solution to power outages. (Note: Aiseubeogun made a
similar presentation at the 6th Nigeria-China business and
Investment Forum in China, and reportedly some Chinese firms
indicated interest in investing in IPPs and other projects. End
note)

Infrastructure Projects
---------------------------------

10. (U) The infrastructure request for assistance from the
Ministries of Transportation, Energy, and Mines include highway
planning, rail transport, rail passenger concession planning, mass
transit, coal for power generation, development of solid mineral
mines, gas pipeline integration planning, development of research
centers for renewable energy and technical skills training for
power, energy, and transportation personnel. Accompanying this
assistance request is a common thread for support in how Nigeria can
get American businesses and experts to come to Nigeria and to export
their products and services, craft a framework for public-private
partnership legislation and performance-based
contracting/procurement. In addition, there are strong requests for
capacity building activities to sustain and grow the infrastructure
and resource sectors.

11. (U) COMMENT: The ministries of transportation, energy, and mines
have, over the course of meetings in the last four months with
econoff, consistently said that they want, trust, and prefer U.S.
engineering, project management, training, goods, and services to be
the anchor for the implementation of rebuilding a sustainable
infrastructure. END COMMENT.)

SANDERS

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