President Muhammadu Buhari has received the report of the Committee on the Impact and Readiness Assessment of the African Free Trade Agree Agreement, AfCFTA.
The report, which was presented to the President on Thursday at the Council Chambers of the Presidential Villa, Abuja, recommended that “Nigeria should consider joining the AfCFTA.”
President Buhari inaugurated the committee on 22 October, 2018 to independently assess the benefits and risks of the AfCFTA to Nigeria, and to propose short and long term measures to manage them.
The mandate of the committee was to review the potential impact of the AfCFTA on Nigeria’s national development plans, fiscal and monetary policies, the effects of smuggling, dumping and other predatory trade practices as well as the implications for intra-African trade patterns.
The committee was also mandated to review legacy bilateral and multi-lateral trade agreements, the implications for free movement of persons on national security, Nigeria’s trade capacity, infrastructure and operating environment in order to establish the country’s readiness for the AfCFTA.
Speaking after receiving the report, President Buhari said that Nigeria would only support free trade that is fair to all parties.
“Our position is very simple, we support free trade as long as it is fair and conducted on an equitable basis,” he said, pointing out that “the AfCFTA will have both positive and negative effects on us as a nation and on our region.”
President Buhari noted that it has been over a year since the African Union Heads of States adopted the Phase 1 Agreement on the AfCFTA at its 10th Extraordinary Summit in Kigali, Rwanda, on 21st of March 2018.
“Since then, a lot has been said about Nigeria’s decision to conduct a detailed study on how this agreement will impact us as a country.
“Let me state unequivocally that trade is important for us as a nation and to all nations. Economic progress is what makes the world go around.
“As Africa’s largest economy and most populous country, we cannot afford to rush into such agreements without full and proper consultation with all stakeholders,” President Buhari noted.
He said intra-African trade constituted only 14% of Africa’s total trade, adding that the continent’s consumption is mostly of goods imported from outside Africa.
The Nigerian leader said that AfCFTA would only succeed if policies are developed to promote African production.
“Africa, therefore, needs not only a trade policy but also a continental manufacturing agenda.
“Our vision for intra-African trade is for the free movement of ‘made in Africa goods’
“That is, goods and services made locally with dominant African content in terms of raw materials and value addition.
“If we allow unbridled imports to continue, it will dominate our trade. The implication of this, is that coastal importing nations will prosper while landlocked nations will continue to suffer and depend on aid.
“As I stated during the inauguration of this Committee, many of the challenges we face today, whether security, economic or corruption are rooted in our inability, over the years, to domesticate the production of the most basic requirements and create jobs for our very vibrant, young and dynamic population.
“Henceforth, we shall ensure that our negotiated agreements create business opportunities for Africa’s manufacturers, service providers and innovators.”
President Buhari said that the AfCFTA that Nigeria aspires to have should not only create wealth for investors but also jobs and prosperity for the country’s citizens.
While commending the committee for its work, President Buhari assured the members that report would form part of the consideration in Nigeria’s decision on the next steps on the AfCFTA and broader trade integration subjects.
Earlier, Chairman of the Technical Work Group of the Committee, Desmond Guobadia, said the committee’s reports “shows that on the balance, Nigeria should consider joining the AfCFTA and using the opportunity of the ongoing AfCFTA Phase I negotiations to secure the necessary safeguards required to ensure that our domestic policies and programs are not compromised.”
According to Guobadia, the committee also recommended the extension of the timelines to achieve trade liberalization and integration ambitions and possibly replacing them with readiness criteria.
Other recommendations of the committee were “introduction of explicit rules on import quota restrictions; and “adoption of a common Market Access Offer for Trade in Goods and Trade in Services for ECOWAS, including synchronized Sensitive and Exclusive Lists.”
It also called for the adoption of the common Market Access Offer for Trade in Goods to replace and supersede the 2013 ECOWAS Common External Tariff (CET), which created vulnerabilities for Nigerian industry and manufacturing; and adoption of appropriate continental customs cooperation and other mechanisms to tackle predatory trade.
“Considering the potential impact of predatory trade on her economy, Nigeria should consider championing the effort at ECOWAS and AU/AfCFTA to implement and enforce these safeguards.
“At the domestic level, we recommend that: A: a National Action Committee on AfCFTA be established to coordinate relevant ministries, departments and agencies to drive the implementation of the AfCFTA readiness projects and initiatives.
“The AfCFTA negotiation mandate should be updated based on the report of this Committee and submitted to Your Excellency for your consideration and further directives.
“We also recommend that the Nigeria Office for Trade Negotiations (NOTN) be strengthened by enacting its Enabling Law expeditiously.
Guobadia said the committee reviewed over 200 submissions from various stakeholders across Nigeria, including farmers, bankers, manufacturers, government agencies and development partners.
He said the14.6% of Africa’s total trade with the world, meant that African countries depend on countries outside the continent for over 85% of her total trade.
Guobadia said the AfCFTA would provide immense opportunities for Nigeria’s manufacturing and service companies to expand to Africa.