Private sector urges caution as debate on AfCFTA rages
The Lagos Chamber of Commerce and Industry (LCCI) says some of the issues raised by Nigeria for not signing the African Continental Free Trade Area (AfCFTA) are genuine.
The chamber, just like the Manufacturers Association of Nigeria (MAN), urges caution to ensure the country makes no mistakes in this regard.
Speaking at a stakeholders’ forum in Lagos, Babatunde Ruwase, president of the chamber, said the high point of argument for Nigeria not signing the AfCFTA was its fear of numerous bilateral trade agreements of some AU countries with the rest of the world and Nigeria’s underdeveloped industrial and infrastructural sector.
“It has been argued that this will potentially make Nigeria a dumping ground due to our uncompetitive manufacturing profile, market size and population.
“To us at LCCI, these are legitimate concerns. It is therefore imperative to deepen consultation across all sectors, in order to address these genuine concerns from stakeholders,” Ruwase said.
After agreeing to sign AfCFTA, Nigeria’s President Buhari pulled out of the treaty arguably on the concerns of the private sector and the labour unions.
Negotiations on the free trade agreement started in 2012 with an ambitious long-term goal of deepening trade among African Union countries, creating bigger and integrated regional markets for African products and achieving economies of scale among African manufacturers.
The agreement removed tariffs on 90 percent of goods and liberalised trade in services to allow African consumers to have access to cheaper products from other African countries.
Apart from allowing domestic firms to access bigger markers, the trade deal aims to remove tariffs and quotas to lower import and consumer prices and increase intra-African trade, which is scratching 15 percent.
According to Chiedu Osakwe, Nigeria’s chief trade negotiator / director-general Nigerian Office for Trade Negotiations (NOTN), Stage 1 of the AfCFTA would create a single market, progressively reducing restrictions to trade in goods and services, based on the agreed modalities of a 90 percent level of ambition, a 10 percent exclusion and sensitive list, as well as identified priority sectors for trade in services.
Osakwe pointed out that AfCFTA implementation was estimated to boost intra-African trade from its current level of 16 percent to 52 percent by 2022, adding that Stage 2 of the AfCFTA negotiations would cover investment, competition and intellectual property.
“The AfCFTA potential is considerable with an estimated population increase in Africa to 4 billion and a GDP increase of $25 trillion, by 2050. Any cost/benefit analysis of AfCFTA accession should estimate the cost of non-accession,” he stated.
“The plan associated with ‘Lagos Global’ by the Lagos State Government recommended an approach for leveraging the opportunities of the AfCFTA through identifying sectoral priorities, market expansion, ease of doing business and consolidating and expanding Lagos as an African economic hub,” he added.
ODINAKA ANUDU