21.8 C
Abuja
21.8 C
Abuja

AfCTA yet to take off fully, negotiations 87% completed – FG

Advertisement

Related

Advertisement
Advertisement

Share this story

2mins read

THE Nigerian government on Wednesday said the African Continental Free Trade Area Agreement,(AfCTA) is yet to fully take off despite officially coming into force on January 1, 2021.

Minister of Industry, Trade and Investment Adeniyi Adebayo who disclosed this at the ongoing intra-African Trade in Durban South Africa confirmed that the negotiations on the rules of origin which is stalling the take-off of the trade deal are 87 per cent completed.

The rule of origin is a criterion where participating countries must source their products locally. There is also a provision to guide against trans-shipment of products outside the African market.

Also, the rule of origin is enforced to ensure no country dumps goods in another country, thereby violating the objective of the trade deal which seeks to promote African products in African markets.

The African Free Trade Area Agreement presents a major opportunity for African countries to bring 30 million people out of extreme poverty and to raise incomes of 68 million others who live on less than $5.50 per day.

A World Bank report showed that with the implementation of the AfCTA, trade facilitation measures that cut red tape and simplify customs procedures would drive $292 billion of the $450 billion in potential income gains.

The report also noted that implementing AfCFTA would help usher in the kinds of deep reforms necessary to enhance long-term growth in the African continent.

- Advertisement -

Adeniyi said despite the hard-core negotiations on the rules of origin, the Nigerian government would ride on its areas of competitive strength such as the ICT sector, trade in goods and services sector and hospitality industries to explore advantages in the trade pact.

He also assured that Nigeria would not be a dumping ground for unidentified products from other African countries – hence the ongoing negotiations on what constitutes rules of origin.

The minister revealed that 100 small and medium enterprises from Nigeria are currently in South Africa for the Trade Fair.

“In Nigeria, the Vice President spearheaded the Economic Sustainability Plan, and we supported several MSMEs to jumpstart their business from the effect of COVID-19. One hundred of such SMEs are exhibiting their businesses here and are matchmaking with other business at this Trade fair.

“In that project of the Economic Sustainability Plan, the Federal Government released the sum of N50 billion as export expansion grant. Many of the exporters exhibiting at the MSME pavilion are some of the beneficiaries of such funds,” he said.

Adeniyi said the intra-African Trade Fair is currently being held in conjunction with the African Continental Free Trade Area Secretariat to deepen discussions with African leaders and businesses on intra-African trade.

The main objective is to liberalise trade so that African countries can trade more among themselves and through that, African economies would be integrated.

- Advertisement -

The founder and chief executive officer of Kenaux International Concept, a shoe and garment manufacturing company based in Aba, Abia State, Ken Ukaoha expressed concerns over the poor state of infrastructure to drive intra-African trade.

Poor state of infrastructure is the bane of Africans doing business within Africa, says Ukaoha, who is also the president of the Association of Nigerian Traders.

Despite decades of common market agreements within the Economic Community of West African States (ECOWAS), poor transportation continues to impede market access.

Analysts say the AFCTA faces similar concerns with fears that countries with better infrastructure could hijack certain key trade pacts to their advantage.

“We do not have a railway to move merchandise from one country to the other. Sea-freighting goods is also a problem. The sea links are not there,”  Ukaoha said underscoring the need for domestic shipping lines that can transport goods across countries.

“When I import raw materials like leather from Hamburg in Germany to Lagos in Nigeria, I pay 850 euros [$986] for a 40-foot container. But the same container transporting our products from Lagos to Tema Port in Ghana costs 1,350 euros [$1566],” he added.

Responding to some of the concerns regarding the swift take-off of the trade pact, the Secretary-General of the African Continental Free Trade Area Secretariat Wamkele Mene said efforts are in top gear to address key problems such as infrastructure and technology access to SMEs.

- Advertisement -

He said, “We are working very closely with our technical partners to develop digital technology platforms that will enable connectivity of small to medium enterprises and enable connectivity of young Africans in trade.

“This Agreement does not benefit only the big corporations on the African continent, but it should always be inclusive of young Africans, women, and African SMEs.”

Support the ICIR

We invite you to support us to continue the work we do.

Your support will strengthen journalism in Nigeria and help sustain our democracy.

If you or someone you know has a lead, tip or personal experience about this report, our WhatsApp line is open and confidential for a conversation

Advertisement

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Support the ICIR

We need your support to produce excellent journalism at all times.

Advertisement

Recent

Nigeria imports 105,000 tonnes of fertilizer raw material from Russia, Canada – NSIA

THE Nigeria Sovereign Investment Authority (NSIA) has revealed that Nigeria will receive 105,000 tonnes...

World Bank warns of looming recession

THE President of the World Bank Group, David Malpass, has warned of global recession...

2023: Sanwo-Olu wins Lagos APC governorship primary

LAGOS State Governor, Babajide Sanwo-Olu, has emerged winner of the governorship primary election of...

FCT minister announces re-opening of Dei-Dei market

THE Minister of the Federal Capital Territory Administration (FCTA) Muhammad Musa Bello has announced...

Abba Kyari is safe in Kuje prison – Nigerian Correctional Service

THE Nigerian Correctional Service (NCoS) has debunked the claim by the suspended Deputy Commissioner...
Advertisement

Most Read

Advertisement

Subscribe to our newsletter

Advertisement