The African Continental Free Trade Area (AfCFTA) agreement is one of the
hottest topics in the business arena in Nigeria and indeed on the African
continent.
The refusal of Nigeria to sign the Kigali declaration and ultimately become a
signatory to the AfCFTA has been widely documented and analyzed. The
organized private sector in Nigeria has been literally divided on this issue, with
the manufacturers Association of Nigeria insisting on ―no-AfCFTA‖, while the
National Chamber of Commerce, Industry, Mines and Agriculture (NACCIMA)
has given the government the go-ahead to sign the agreement.
Nigeria will sign the AfCFTA, regardless of
when that happens (today or sometime in
the future). That is, if there is still an
AfCFTA to be signed when we are ready
to do so.
The truth is that this AfCFTA represents
potentially, the single biggest trade
window for Nigeria to truly benefit from.
According to available statistics, Nigeria
has signed over 500 trade agreements
since independence and the unanimous
verdict from trade experts is that the
nation has not really benefited much from
them.
For instance, in the ECOWAS sub-region,
Nigeria comes in 8th out of 15 countries
in terms of regional trade. That is woeful
whichever you look at it. With the rest of
Africa, the outlook is not much better. In
terms of extra-Africa trade (excluding
crude oil and petroleum) with other
regions over the past five or six decades,
we are yet to witness the promised
diversification or development to the
country‘s economy.
This may not be unconnected to the
concessional nature of most of these
extra-African trade agreements like
AGOA, which may be suspended or not
renewed, on a whim like the case of
Rwanda and Madagascar. Besides, most of
these agreements place demands on our
businesses and government that make it
difficult for us to truly play at the level
expected of us. Businesses in turn, are
afraid to make long term plans around
such arrangements when it is uncertain
whether preferential market access will
still exist in the future.
So an AfCFTA that has the potential to
level the playing field and force all African
nations to play by the same set of rules
cannot be the worst platform for Nigeria
to join.