• Monday, May 27, 2024
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Achike Udenwa, it’s a foolish policy



Those following trade issues will be very familiar with the split brought about by the need for Economic Partnership Agreements (EPAs) between the European Union and countries of the Africa, Caribbean, and Pacific (ACP) to comply with World Trade Organisation’s (WTO) non preferential policies. The split was more pronounced in the West African region, nearing the end of 2007 deadline. In order to meet the commencement of the new EPA regime, Ghana and Cote d’Ivoire went ahead to sign separate agreements with the EU.
As expected, Nigeria did not come to any agreement with the EU, and seems not in a hurry to do so. The argument is that the country will be flooded with goods from the EU. While not suggesting which way the discussion should go, the fact remains that Nigeria has not signed any agreement, and we are not in a hurry to do so. Interestingly, this is a discussion that began since 2002. To underline our inability to sign trade agreements such as EPA is our inability to accurately determine the implications of any trade policy regime, followed by our inability to monitor those implications for industry and commerce.
So, ours is a capacity issue, to the extent that, we are unable to judge any form of benefit, both present and potential for any form of trade regime. Consequently, we adopt no agreement, while confusion and aggregation rules. Rather than protect anything, with the expectation of growth, our borders become porous. Ironically, the more we continue to theoretically shut our borders, the more goods come into the country, as our reports of last week have shown the alarming rate of smuggling.

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I have no idea of what many people think of the reports, but I can imagine that most responses will be nonchalant. It is nonchalant because some of the goods under prohibition list will be considered folly by many. It is folly because those goods, although prohibited in the country, still find their way in, and also visibly displayed in every area of our markets. It is visibly displayed, after the customs man has collected his bit and the customs man will never tell Achike Udenwa that he his presiding over a foolish policy.
If you think I am too harsh, I bet you will be as shocked as I was when I found out that lace fabrics, george clothing materials and other embroidered fabrics are prohibited. My first thought was, wait a minute, I have seen many ministers and governors wear such on Bisi Olatilo show. Not done, I realised that made-up garments and other textile articles are also prohibited. I suppose jeans is among these materials (and I am wearing one bought here in Lagos), and I think all the TM Lewin stores scattered around Lagos fashion stores sell these prohibited shirts, ties, suits and ties. Wow! We have successfully put in place a law that potentially criminalises majority of our citizens. It is a stupid law that does that.
To complicate matters, there is also the prohibition of second hand clothes. Of course, the caveat to all these nonsense prohibitions is that except for personal use. I guess when you finish reading this; you will go to any of those stores to pick up one for your personal use.
Now, why do our policy makers subject themselves to this sort of ridicule? There are many reasons, but I will comment on one that you may not find quite related. It is because they are lazy. It is because those in charge of our successive trade policies are lazy that we do not have any significant and tangible industrial policy. Industrial policy is selective, detailed, requires serious engagement with the private sector, cooperation and hard work. It requires research and some significant economic thinking. How many civil servants are prepared to do that in the ministry of commerce and industry? Or if prepared, is the government ready to support that level of activity?
Consequently, we do not produce anything because our government does not understand how to make us produce anything of significance. Because of that, they place ban on many things, to encourage us produce what we have not managed to produce in 50 years. But there is a bigger problem here than many think. The hypocrisy in government is lamentable. Yes, it is hypocrisy for government officials to wear jeans, TM Lewin or even better shirts, solid leather shoes, and other imported wears in the name of bringing them in for personal use and expect that because I cannot travel, I should not wear the kind of clothes I desire.
Not done, it is hypocrisy to collect sales tax from some of these shops, and of course, the height of this hypocrisy and corruption is the customs man that collects his taxes at the different porous borders because we insist on maintaining what we all know is a foolish policy. Instead of having an open and honest debate of our trade and industrial policy, we pretend as if the laws that make all these wears prohibitive do not exist. Can you imagine the government of any serious country pretending that a law does not exist?

Finally, let me end on this note. We can trade successfully, but we must do our home work and that is the hard work we are running away from. Trade policy must be selective and only selective prospects are promoted and supported. And government must lead. Udenwa, it’s all up to you!