Aftermath of the visit of Secretary-General of the African Continental Free Trade Area (AfCFTA), Wamkele Mene, to Nigeria on the country’s preparedness for the continental trade scheme, there are reports that Nigeria would pull the plugs on the January 1, 2021 take-off date due to factors not unconnected to COVID-19.
New Telegraph reliably gathered from members of the organised private sector (OPS), who are members of the Federal Government’s National Action Committee on the implementation of AfCFTA, that recent happenings with regard to COVID-19 crisis, border closure, infrastructure deficit, trade imbalance, concerns over rules of origin and others would force Nigeria into aligning with the July take-off date.
However, key OPS members revealed to our correspondent that Nigeria is expected to intimate the African Union (AU) of its choice date. AfCFTA, which ought to have started in July this year, had been delayed following the COVID-19 crisis. Director-General, Lagos Chamber of Commerce and Industry (LCCI), Dr. Muda Yusuf, told New Telegraph that the January 1, 2021 flag-off date would put the country’s trade on edge.
He explained that the private sector bodies, including NACCIMA, MAN and LCCI, had told the Federal Government’s National Action Committee on AfCFTA implementation that there were still concerns over Nigeria’s readiness for the continent’s trade treaty take-off date. Yusuf pointed out that, ideally, the continent’s volumes of trade with one another would be put to test during the trade agreement flag-off, but that the adverse effects of COVID-19 and other impending challenges in Nigeria have shown that Nigeria is not ready for the January 1 date.
The LCCI DG said: “Yes there are concerns whether we are ready for the AfCFTA or not because as we speak we still have quite a lot of challenges with our competitiveness. There was a readiness report, which was prepared by a committee of the Federal Government, which outlined all the issues and things that we need to do to make Nigeria ready for AfCFTA. “But as I speak to you, I don’t think we have done much. But there are on-going engagements among manufacturers, LCCI and NACCIMA.
We will continue to engage the authorities on this AfCFTA. So, at the appropriate time, the OPTS would be able to take appropriate position on the issues of readiness of the country. But in principle, I think all of us have accepted that that is the way to go. But what the issue is now is the timing – whether we are ready for the January 1, 2021 date or not.”
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In his own response, the Chairman, MAN Export Promotion Group (MANEG), Chief Ede Dafinone, a chartered accountant, said that at the moment, Nigeria was not prepared for AfCFTA, highlighting that the country needed additional preparations to take full advantage of the trade treaty scheme. Dafinone suggested that the country needed to use the COVID-19 crisis and others to call for force majeure on AfCFTA’s January 1 date for takeoff He said: “We are not properly prepared to take advantage of the possible benefits to Nigeria in terms of the African Continental Free Trade Agreement (AfCFTA) and in my opinion as a country, we need additional preparations to take full advantage.
My view would be that we should on the back of COVID-19 call force majeure on this and ask for an additional year in order to put our house in order before we go live on the AfCFTA.” On his part, the Executive Chairman/CEO, BUA Group, Abdul Samad Rabiu, elicited Nigerian private sector excitement and readiness to work towards the implementation and success of the agreement, which when fully operational, would transform the African economy and enhance development across the continent.
Rabiu raised concerns about the current status of regional agreements from the ECOWAS Trade Liberalisation Scheme (ETLS) to the East African Community (EAC) Customs Union, dumping, proliferation of small arms and smuggling, noting that these were areas critical to the success of Af- CFTA.
He specifically said due to the poor implementation of regional trade agreement, there was a high level of distrust amongst Africa nations despite their support for AfCFTA He said: “We believe a lot needs to be done and addressed. They include the status of the current regional agreements – for example, ETLS, EAC Customs Union, movement of people within the continent, dumping, proliferation of small arms and illicit drugs, smuggling, the trans African highway, private sector/AU/Government partnerships.”
MAN President, Mansur Ahmed, also raised concerns about the treaty, especially on the country’s economy and its manufacturing sector. Ahmed explained that the country is yet to prepare with concerns surrounding trade imbalance and rules of origin. However, the MAN president stressed that MAN and others were engaging the Federal Government on the need for a postponement in the implementation date from January 1, 2021, which is not tenable under the current headwinds in the country. Ahmed said: “We thank the government for constructive engagement with MAN on AfCFTA. “However, MAN has some few concerns on the trade in goods market access.
There is a major concern on the rules of origin. Why MAN appreciates a simple, transparent and flexible rule of origin, it is important for extensive engagement with the productive sectors before finalisation of the agreement.” In his own submission, the Acting Director-General of MAN, Paul Oruche, explained that Af- CFTA seeks to liberalise trade among African countries.
He noted that it was targeted at a ‘borderless’ Africa, with an eye on a single market for goods and services on the continent. It is easily the largest trade agreement since the World Trade Organisation (WTO) in 1994 and a flagship project of Africa’s Agenda 2063, targeted at creating a single market for 1.2 billion people and exposing each country to $3.4 trillion. Meanwhile, the National Action Committee on African Continental Free Trade Area (AfCFTA) has inaugurated some eminent Nigerians as “AfCFTA Champions” to mobilise technical and financial resources towards implementing the country’s share benefits in the continental free trade area.