In driving Nigeria’s economic growth, improving its exports, and fixing its economic stagflation, the country needs to actively participate in the African Continental Free Trade Area (AFCFTA). Active and significant participation will require effective utilization of the country’s competitive strengths.
The trade agreement which was implemented on January 1st aims to deepen the continent’s economic integration and expand intra-african trade. For Nigeria to effectively utilize the trade pact, Francis Anatogu, secretary, National Action Committee on AFCFTA highlighted Nigeria’s competitive strength and practices that will help to fully harness the opportunities of the country’s assets.
He stated this during the ninth edition of the Leadership Excellence for National Development (LEND) Webinar and Podcast Series of the JCI Nigeria Senate Association, which focused on the risks, and rewards of the Africa Continental Free Trade Agreement (AFCFTA).
Anatogu noted that the trade agreement will grant access to a large market worth $ 504.17 billion in goods and $162 billion in services, which will improve and expand intra-african trade and also enhance competitiveness among participants.
Anatogu who doubles as the senior special assistant to President Buhari on public sector matters said Nigeria has abundant natural resources with a thriving industrial and retail sector and a huge reserve of latent demand.
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In addition to this is the government’s economic diversification drive, the presence of global players in the country and investment incentives. The country also has the largest economy in Africa with a large growing population comprised of young energetic, innovative, tech-savvy, entrepreneurs.
“The presence of global players in Nigeria and the growing plethora of Nigerian brands adding value to economies across Africa showcases Nigeria’s soft power capabilities and capacity to galvanize regional economic growth and development,” he said.
Anatogu said that it is critical for participants to adopt backward integration and value addition practice in its production and export process especially in the manufacturing, energy, agriculture and services sector which are priority sectors.
“The agreement is a clarion call for businesses to boost backward integration and local value addition in readiness for trade opportunities, AFCFTA offers a stepping stone to the global market place, but first, let’s even begin to build for the African market and let’s begin to scale and formalize our trade activities,” he explained.
He also advised the need to strengthen the country’s economic diversification framework moving from crude oil to the agricultural and manufacturing components of the economy
“We are leveraging AfCFTA to prepare for a post-oil revenue-driven society, Success with AFCFTA is a diversified and sustainable Nigerian economy with strong linkages with neighbours and the top economies in Africa and a globally accepted country brand,” Anatogu said.
Highlighting potential gains, he said the trade agreement will create jobs, protect sovereign wealth revenue, and improve industrial productivity through competition and specialization.
Anatogu noted challenges to AFCFTA implementation in Nigeria include prevailing predatory trade practices, funding, regulatory and infrastructure constraints, insecurity, production and productivity issues, smuggling, unfriendly trade policies, etc.
He said that the presence of these challenges may limit the impact of the trade agreement, and should be addressed by the government. Anatogu mentioned some provisions of the government in the 2021 budget, which will enable the seamless facilitation of the trade agreement in Nigeria. They include the construction of bridges, roads, rail and power infrastructure worth billions of naira.
In addition, is the provision of grants and enabling policies like the N1bn Nigeria-Africa Trade Investment Programme, N2.3 trillion National Economic Sustainability Plan for export-driven economic growth, National Economic Diversification Agenda, the Nigerian Industrial Revolution Plan, and many others.
Funke Opeke, Founder and Chief Executive Officer of Mainone, noted that one of the goals of the trade agreement is to reduce dependence on external goods and services while encouraging patronage of locally produced goods within the continent.
She added that the rewards of the trade agreement will deliver value for the local economy which will outweigh the risks involved. She added that the benefits will be accelerated provided that the policy, regulatory and business frameworks between the private and public sectors are corresponding.
“We need to mobilize our private sector firms for performance, productivity, competitiveness and market positioning to better leverage our huge domestic markets because other countries, including global players, are already mobilizing to use our economy as a springboard to achieve their growth and business development goals,” Opeke said.
