President Muhammadu Buhari has formally received the report of the committee on the assessment of the impact on Nigeria and its readiness for the Africa Continental Free Trade Area (AfCFTA) with a cautionary note that the agreement has good and bad sides.
The committee headed by Desmond Guobadia, in submitting its report to the president on Thursday at the presidential villa, Abuja had urged Nigeria to consider joining the AfCFTA after securing necessary safeguards against compromising domestic policies.
“Your Excellency, our 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,” Guobadia had said.
President Buhari, however, said that even though Nigeria supported free trade, it must be on an equitable basis, stressing the negative and positive sides of the agreement.
According to him, “Our position is very simple, we support free trade as long as it is fair and conducted on an equitable basis.
“The AfCFTA will have both positive and negative effects on us as a nation and on our region.
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.”
Noting that intra-African trade was only 14% of Africa’s total trade while consumption was mostly of goods imported from outside the continent, he admonished that for AfCFTA to succeed, policies that promote African production, among other benefits must be developed.
He added: “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.
“The AfCFTA we aspire to have should therefore not only create wealth for investors but also jobs and prosperity for our vibrant and hardworking citizens. The benefits of economic growth must be prosperity for the masses.”
The President assured that the report will form part of the consideration in his administration’s decision on the next steps on the AfCFTA in particular and on broader trade integration subjects.
In submitting the report, the committee specifically, the committee recommended various safeguards including the extension of the timelines to achieve trade liberalization and integration ambitions and possibly replacing them with a readiness criteria, introduction of explicit rules on import quota restrictions; and the adoption of a common Market Access Offer for Trade in Goods and Trade in Services for ECOWAS, including synchronized Sensitive and Exclusive Lists;
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It also recommended 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.
It noted that 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, the committee recommended that 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; that the AfCFTA negotiation mandate should be updated based on the report as well as that the Nigeria Office for Trade Negotiations (NOTN) be strengthened by enacting its Enabling Law expeditiously.
The committee was inaugurated by President Buhari on the 22nd of October 2018, to independently assess the benefits and risks of the AfCFTA to Nigeria and to propose short, medium and long-term measures to manage them.
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