The African Continental Free Trade Area (AfCFTA) may not be realisable after all, unless Nigeria and other 53 African nations, which signed into the agreement, muscle enough courage to synchronise the trade policies and ensure availability of infrastructure that will facilitate trade.
Stakeholders, who spoke at a one-day workshop organised by the Lagos State Council of Nigeria Union of Journalists (NUJ), themed: “African Continental Free Trade Agreement (AfCFTA) challenges on Nigerian Businesses”, said the necessary framework to promote AfCFTA are currently absent and therefore triggered fears that the trade agreement might be a mirage after all.
Registrar, National Association of Government Approved Freight Forwarders (NAGAFF) Academy, Francis Omotosho, said AfCFTA might not be possible because of numerous challenges that are likely to stall the initiative.
He said the 54 countries, which have signed into the agreement must remove the barriers.
He explained that Nigeria, which is the trade hub in the continent, is not stable politically and economically, hence posing a setback to the initiative.
He explained: “There are several challenges that will mar AfCFTA. It might not be possible after all. Africa has 55 recognised countries by United Nations (UN). Nigeria is the most populous with over 200 million people. Trade is about population, which means Nigeria is the first when it comes to trade.
“The first thing that will make any continental agreement work is when the leader of that continent is in good shape. Nigeria, which is supposed to lead Africa, is in problem. If we don’t get it right internally, there is no how the continental agreement will work.
“It’s unfortunate that Nigeria cannot overcome its internal battle not to talk of external battle. There are over 15 existing major regional trade in the Africa Union. So it is very important that we come together as a bloc to form unity in trade.”
He identified the trade barriers and challenges of AfCFTA to include tariff and non-tariff, lack of commitment to execute AfCFTA, inadequate trade infrastructure, lack of rail transport system, inconsistency in trading agreement among member countries, cross-border trader settlement, movement of people being frustrated in terms of documentation, no access to capital, and no multimodal transport system.
“Our internal tariffs, rate and policies are very bad, and these will frustrate AfCFTA. Nigeria itself is about to collapse and our tariff barrier is total rubbish. Nigeria is still talking about 24 hours port operation, which is not working. These are things we should be looking at. Information Communication Technology is still poor; by now Nigeria should have hosted its own satellite, but its nowhere. Access to capital is poor, access to multimodal transportation is lacking and government should stop giving targets to Customs,”
Director-General, Manufacturers Association Nigeria (MAN), Segun Ajayi-Kadir, said Nigeria’s level of readiness for AfCFTA is still very low, adding that, “we will excel in AfCFTA if the competitiveness of our market is assured.”
Ajayi-Kadir, who was represented by Director, Research and Advocacy, Oluwasegun Osidipe, said: “AfCFTA is a good project if effectively implemented. Already, it has been flagged off, but no physical trading has commenced.”
He urged the government to carry along the private sector to benefit from the agreement, saying, “We need to have adequate information on what was negotiated,”
He listed the hurdles to include high cost of input. “We are still lagging behind in ease of doing business, power supply challenges, and infrastructure to connect the hubs (farms, market and ports) are lacking.
Chairman, Lagos State Chapter, Nigerian Union of Journalists (NUJ), Adeleye Ajayi, said AfCFTA presents a major opportunity for African countries to take 30 million people out of extreme poverty and to raise the income of 68 million others who live on less than $5.50 per day.
He said with the implementation of AfCFTA, trade facilitation measures that cut red tape and simplify Customs procedures would drive $292 billion of the $450 billion in potential income gains.
Meanwhile, he said achieving the full potential of AfCFTA would depend on putting in place significant policy reforms and trade facilitation measures.
Managing Director, Skyway Aviation Handling Company Plc, (SAHCOL), Basil Agboarumi, said AfCFTA would help boost trade and tourism, if properly implemented.
Agboarumi, who was represented by Manager, Corporate Communications, SAHCOL, Mrs Uanshioa Adetola Vanessa, urged all stakeholders to play crucial role towards the success of the continental agreement.
Noting that Nigeria is having challenges keying into AfCFTA, she cited the cumbersome process of immigration documentation, language barrier, tough intercontinental policies, and political unrest as barriers to a successful free trade.
Chairman of the occasion, and former President, National Association of Government Approved Freight Forwarders, Eugene Nweke, said Nigeria needed to fine-tune its involvement and participation in AfCFTA.
“Nigeria is the largest economy in the continent and if we don’t position ourselves, we might find ourselves at a disadvantaged position. AfCFTA is a game changer. There is no system that is perfect but with the commitment of all parties, it will work and we must all work to make it a success,” he said.
If properly harnessed, he said the free trade agreement would eradicate poverty, boost production and increase the Gross Domestic Products (GDP) of nations.
Comptroller-General, Nigerian Customs Service (NCS), Hameed Ali, represented by Deputy Comptroller of Customs, Muse Omale said the service has always been at the fore front of trade facilitation, noting that AfCFTA will not be an exception.
He said, “We always try to key into government policies and use it to the advantage of Nigerian economy,” adding that the revolution in Customs automation would facilitate trade and boost AfCFTA.