Nigeria continues to lag behind in making the trade agreement operational nearly two years after the African Continental Free Trade Area Agreement (AfCFTA), which went into effect on January 1, 2021, due to structural difficulties and a lack of agreement on trade protocols and strategy among stakeholders.
Despite the nation’s ongoing declarations of its willingness to start trading, the political will to carry out the agreement is still in question given the speed and protectionist position of Nigeria and other African states.
Seven nations have already been chosen to begin trade in a pilot phase of the AfCFTA, including Tanzania, Rwanda, Cameroon, Egypt, Ghana, Kenya, and Mauritius.
According to the AfCFTA secretariat, the action aims to evaluate the environmental, legal, and trade policy foundation for intra-African trade. The 36 nations that had showed interest in trading during the pilot phase were chosen. Each applicant had turned in their tariff schedule.
The organized private sector is concerned since Nigeria has not yet finalized its tariff schedule or revealed the rules and implementation plan for the trade agreement.
Francis Anatogu, the secretary of the National Action Committee on the African Continental Free Trade Agreement (AfCFTA), declared on Tuesday that everything is prepared for Nigeria to start trading under the AfCFTA.
This was said by Anatogu at the Export Group Symposium of the Lagos Chamber of Commerce and Industry (LCCI) in Lagos. The Secretary emphasized that Nigeria must pay attention to institutional cooperation between the federal government and the private sector, trade facilitation, policies, infrastructure, trade information, and free movement of people and goods.
“Understanding the prospects is what we will be concentrating on in 2022, and we have already identified areas that are priorities for AfCFTA in terms of products and services. In order to help us focus on the near term and frontiers that we can work on in the medium to long term, we have also been able to dimension them into arrowheads,” he added.
However, he emphasized the need to increase the amount of domestic transactions while also encouraging and helping companies to tap into the African markets. He also emphasized the necessity of luring foreign investment in order for the nation to benefit from the AfCFTA
“At the National Action Committee (NAC), our mission and vision for the AfCFTA is to take 10% of Africa’s import from the world to provide the products and services that are currently supplied by other countries outside of Africa from Nigeria, but we know that for us to achieve that, we need to focus on developing value chains in products and services,” he said.
He stated that the Nigerian Export Promotion Council (NEPC) reported an increase in exports over the previous year and suggested that Nigeria’s next move should be to increase its manufacturing presence on the continent.
He said Nigeria is about to join and that seven countries have so far begun testing the AfCFTA trade, adding that one of the main components the nation is working to put in place is the preferential trade process in order to be able to trade under the AfCFTA.
“The Nigerian Customs Service (NCS) has developed this procedure and is being reviewed with the stakeholders with a view to adopting it and publishing it for businesses to start to use,” he added.
Earlier, Asiwaju Michael Olawale-Cole, president of LCCI, stated that the AfCFTA, which will be launched in 2021, is the centerpiece project of the African Union’s (AU’s) Agenda 2063, a plan for achieving inclusive and sustainable development across the continent over the course of the following 50 years.
Earlier, Asiwaju Michael Olawale-Cole, president of LCCI, stated that the AfCFTA, which will be launched in 2021, is the centerpiece project of the African Union’s (AU’s) Agenda 2063, a plan for achieving inclusive and sustainable development across the continent over the course of the following 50 years.
He claimed that by offering a thorough and mutually beneficial trade agreement among the member nations, including trade in products and services, investment, intellectual property rights, and competition regulation, it hopes to increase intra-African commerce.
He emphasized that the Pan-African Payments and Settlement System (PAPSS) is a centralized infrastructure for intra-African trade and commerce payments, adding that this project, which is being developed in collaboration with the African Export-Import Bank (AFREXIM) Bank, will facilitate payments and formalize some of the unrecorded trade due to the prevalence of informal cross-border trade in Africa.
He bemoaned the fact that exporting raw materials and primary goods, such as cocoa, cashews, and leather over the years, has dominated Nigeria’s non-oil export sector and will not provide the appropriate amount of foreign income without value addition through processing.
“We could generate more foreign exchange earnings if these primary products are processed into finished goods for the international markets, ‘The potentials of non-oil exports are largely untapped due to over dependence on crude oil exports,” he averred.
The Chairperson of the LCCI Export Group, Mrs. Bosun Solarin, stated that without an efficient distribution channel, the benefits of the AfCFTA remain illusive and impossible to realize. In this regard, logistics play a crucial role in bridging the gap between the hopes and reality of the AfCFTA.
