• Tuesday, July 16, 2024
businessday logo

BusinessDay

Improving Nigeria–South Africa bilateral relations

Financial watchdog puts Nigeria, South Africa on dirty-money gray list

Any observer that has any keen interest will notice the concerning bilateral relations and general (subtle) trade wars between Nigeria and South Africa. Also, there are other critical issues such as the longer time South African Visas are issued to Nigerians traveling to South Africa for vacation, tourism, family, conferences and business visits. Many in recent times have witnessed outright rejections or flimsy visa denials.

For the record, the undersigned have never been denied a South African Visa but this write up bothers on the hope that an improved, cordial, better and mutually beneficial bilateral and trade relations with our South African partner is possible with a strong case for the same.

Recent developments reveal that the perceived strain between both countries have not abated in any way despite the visit of South Africa President, Cyril Ramaphosa to Nigeria on the 30th day of November 2021. The expectation regarding his state visit was to strengthen or reactivate the Nigeria-South Africa Binational Commission that was established in 1999 and resolve ‘naughty’ issues that besets both countries.

This strain accentuated by the last major Xenophobic attack of Nigerians in 2019, the expulsion of 125 Nigerian on Yellow Fever vaccination certificate 2nd March 2022, and Nigeria’s consequent retaliation by expelling 56 South African business people working in Nigeria, massive sanction and penalty placed on MTN (largest telecoms provider in Nigeria) and FIRS huge tax altercation with Multichoice (the principal cable network provider in Nigeria).

From another perspective, it is interesting to note that both countries have huge economic and trade ties with each other. Firstly, Nigeria exported goods worth at least USD2.17BN in 2020 with petroleum products and gas representing approximately 98.5 percent of these exports whereas gas USD11.2Million, Scrap metal USD$8.2million amongst others.

However, South Africa exports to Nigeria totalled USD$495million including Propylene Polymer USD$91.9million, Apples & Pears USD$32.6million, delivery trucks USD$32.5million and Buses USD26.6million same 2020 using OEC statistics.

Recent developments reveal that the perceived strain between both countries have not abated in any way despite the visit of South Africa President, Cyril Ramaphosa to Nigeria on the 30th day of November 2021

Secondly, there are many South African businesses operating in Nigeria as Blue-Chip Companies namely MTN, Multichoice (DSTV), Sun/Protea Hotels, Stanbic IBTC, Oracle, PEP, Eskom and many more. Whereas most Nigerian businesses operating in South Africa are mostly small scale businesses except for the few banks that are represented therein such as Zenith Bank, Union Bank, First Bank and First City Monument Bank.

Thirdly, there appears to be an unrestricted cultural exchange between the two countries. Many musical artists in Nigeria easily collaborate with their South African partners and possibly infusing a blend of new sound that is emerging (please listen to Burna Boy and DJ Tarico, Davido and Focalistic).

Read also: Ghana to host ECOWAS finance award

The same could be seen in many South African aspiring fashion designers coming over to Nigeria to learn fashion designing, or the shooting of high-quality company advertorials or musical videos. In fact, many South Africans in the media, branding and advertising space are employed in Nigeria to lead teams in this space based on their unique competences and skills.

There are many other collaborative efforts forging a good union and relationship between both countries, so why should both countries relationship be significantly strained with embedded high levels of mistrust and high unhealthy competition that appears to limiting the great potentials that both countries can garner or explore further as both being the ‘giants’ in their respective domains (Nigeria in ECOWAS and South Africa in SADC).

There appears to be significant mistrust from both sides. MTN recently claimed it paid N618.7billion as direct taxes and N138.3Billion taxes to FIRS potentially representing approximately 13.5% of all taxes/revenue generated by FIRS in 2021. MTN expects a fairer operational treatment within Nigeria and this may have forced their listing on the Nigeria Stock Exchange (NSE).

Similarly, Multichoice (operators of DSTV in Nigeria) have been embroiled in a gruelling tax dispute with FIRS where the cable company was advised to pay a tax backlog totalling USD4.4billion and consequently required to deposit the sum of USD19.4million in order to challenge this disputed sum in court.

Within South African borders, Nigerians who usually operate from small scale business positioning have been operating prosperously in many South African suburbs that appear to harbour many entitled South African youths that appear to claim rights and privileges as citizens.

The ‘loud’ and flamboyant natural posture or domineering (or dominating) outlook of Nigerians doing business therein must have pitched them against their possibly ‘lazy’, privileged or entitled South African youths that appear to have labelled many Nigerians with one brush as drug dealers or traffickers, and home breakers via many infidelity cases within families that suggests involvement of Nigerian youthful populace living in South Africa.

South African men appear to be very jealous of their women and do not take kindly to the evasion by Nigerians of their ‘wealth spring of nature’ on a lighter note.

Going forward, what should both countries be interested in and that is geared towards a mutually beneficial and harmonious business, economic and trade relations between the peoples? Observing that both Presidents are committed to this positive course of action judging from the Federal Government of Nigeria’s powerful showings at many South Africa Government based exhibitions, Investment fora, conferences etc. In freight forwarding, there are good relationships and strong collaborations that have evolved (emerged) by members from both countries belonging to the same freight forwarding association.

There has not been any noticeable disputes or real disputes due to business execution and payments thereof. If this is operationalised in other trades or businesses, the mistrusts will begin to fizzle out over time.

Presidents Ramaphosa visit to Nigeria that includes the review, update and signing of a revised bilateral relations agreement revealed the urge by both countries to strengthen the Nigeria-South Africa Binational Commission, and the real need to promote Africa Continental Free Trade Area (AfCFTA) where there will be free flow of trade within the continent and the possibility to have a platform for currency exchange (PAPSS) within the continent without recourse to the use of United State Dollars.

This is already in the works and promoted by Afreximbank. There are no reasons why both countries cannot adopt the Nigeria – Kenya bilateral relations in the immediate term whereby Nigerians receive VISA on Arrival and vice versa. Nigeria and South Africa share similar histories, both countries being former colonies of the British empire, members of the Commonwealth of Nations and The African Union.

Both Presidents have shown symbolic way forward and it is now left for the bureaucrats to work this through to the ‘shop floor’. All government agencies and parastatals from both sides must be given targets to operationalise, adopt or gazette these agreements and common understanding. Where legislative changes or inputs are needed, there must be a concerted effort to lobby the parliament or legislative as it applies to fast track this needed synergy, cooperation and collaboration.

Lastly, citizen engagements should be adopted where we can have many cultural exchanges at the lower levels of the society. These exchanges could include student exchange, collaboration on educational programmes, options for learning/ teaching local languages in schools, joint sporting events, right of citizenship for inter-marriage, pathway for internships, military training and collaborations, lowering on trade tariffs/ barriers etc.

Adewale, aviation expert and chief executive officer – Mainstream Cargo Limited