With Nigeria officially stepping into the African Continental Free Trade Area (AfCFTA) framework through GTI, the continent edges closer to establishing the world’s largest trading bloc after the World Trade Organization. T
his move holds significant potential for boosting intra-African trade and economic integration.And that would guarantee Africa a prime of place among the comity of nations in the world of international trade. It will be a massive bargaining chip to get a fair deal for the long-suffering people of the continent, that would launch them on the path of sustainable development.
According to thecable.ng, Considering how strategic Nigeria is expected to be in everything that has to do with economic development of Africa, there is no prize for accurately predicting what role Nigeria will play in making this a reality. And if Nigeria lives up to the leadership role it’s primed to play on the continent, it will be a win-win thing for the country and the rest of the continent. Nigeria is a ready market of over 200 million consumers.
That should turn heads in any multinational’s boardroom, irrespective of their product lines. This explains why people, like yours sincerely, who are interested in Africa’s regional economic integration became disappointed over Nigeria’s refusal to sign the African Continental Free Trade Agreement (AfCFTA) on time, until President Muhammadu Buhari did on 7 July 2019. But, signing the agreement is one thing, implementing it is an entirely different kettle of fish.
READ: Africa: Nigeria Makes Historic AfCFTA Trade Move with First Export to Kenya
To demonstrate its commitment, the Nigerian government has established the National Action Committee on the AfCFTA (the NAC). But the reason for this delay in commencing the Guided Trade Initiative (GTI) — a pilot scheme aimed at test-running the feasibility of the agreement (AfCFTA), is quite understandable. The modality, to ensure that existing treaties signed by the country are not drastically affected, must be worked out, nevertheless, at last, here we come.
It was, therefore, a thing of joy for me that, as the kick-off of the African Continental Free Trade Area (AfCFTA) gathers momentum in countries like Ghana, Uganda, Kenya, Tunisia, Rwanda among other countries with the GTI, Nigeria, one of the three largest economies on the continent has finally overcome the institutional inertia, and had taken the bold step of joining the fray.
This happened on Tuesday, the 16th of July 2024, when it joined within the framework of the GTI. The first shipment of goods from Nigeria to some member countries was done by “The Le Look”, a bags-and-fashion accessories company (It was the first Nigerian business concern to use the AfCFTA’s GTI), owned by one Madam Chinwe Ezenwa, who was the first Nigerian to use the AfCFTA’s Guided Trade Initiative. She holds the first Agreement’s certificate of origin. No less an important personality than the UK’s Permanent Representative to the World Trade Organization (WTO) and UN in Geneva, Simon Manley, gave a statement during a “Nigeria’s Trade Policy Review” earlier this November, commending the federal government on this milestone achievement.
The achievement could not have come at a better time than now, when the Nigerian economy is experiencing an unprecedented turbulence, signposted by what I call, “a galloping hyperinflation” (if there is anything like that), induced by a very weak currency — the Naira, and over dependence on import. Our production and consumption are both, heavily import-dependent. This occasions deficits in the country’s Balance of Trade, and by implication, Balance of Payment. The Nigerian economy can therefore succinctly put, be said to be a grossly import-dependent, and export-deficient one.
It is not due to a lack of productivity by Nigerians, but to lack of a clear-cut policy agenda, on the part of those in government, to stimulate export, and discourage the importation of virtually everything, including things that could be sourced locally. It must be reemphasized that, Nigerians are some of the most industrious and enterprising people you can ever find on this side of life. But imagine, a monocultural economy like that of Nigeria, depending solely on crude oil export without any value addition, and having to import refined products in return, to meet domestic demands. Meanwhile, the federal government has four refineries lying comatose — two in Port Harcourt (did they say one of them has commenced operation?), and one, each in Warri and Kaduna. That is an economic disaster waiting to happen. And it seems to be exploding in our faces at the moment. But with this new vista of market opportunities opened for Nigerian businesses to take their products and services beyond the shores of the country, across to other African countries, the government cannot afford not to get it right at this opportune moment.
The newly commissioned, multi-billion dollars Dangote Refinery and Petrochemical limited on the Lekki peninsular is a good starting point for us. It is reported to be the single largest train of refinery in the world, with a daily refining capacity of 650 barrels of crude. It, reportedly, has the capacity to meet a larger chunk, if not all, of African demand for refined petroleum products. Moreover, Nigeria is reputed to be the largest producer of rice in Africa, even though it is still struggling to meet its local demands. The same goes for tomatoes, and several other agricultural produce. In fintech, Nigerian firms also blaze the trail with the likes of Flutterwave, Interswitch, Opay, Moniepoint, Paga, Remita, Kuda among others, taking the driver’s seat in Africa.
