The African Continental Free Trade Area (AfCFTA) has officially come into force.
“It is now official: African Continental Free Trade Area (AfCFTA) agreement has entered into force today, 30th May 2019,” a Twitter statement from the AfCFTA on May 30 said.
“The required number of ratifications has already been deposited and the agreement is now a binding international legal instrument,” the statement added.
Last month, The Gambia joined 21 other countries to ratify the continental trade agreement that will remove trade barriers and restrictions across African countries.
The AfCFTA is said to have the capacity to create the largest trade zone in the world and increase intra-African trade by 52 percent by 2022 while removing tariffs on 90 percent of goods.
The Gambia joined South Africa, Ethiopia, Sierra Leone, Lesotho, Burundi, Namibia, Guinea Bissau, and Botswana, among others, which have ratified the agreement to support the commencement of the largest trade agreement since the World Trade Organisation (WTO) in 1994.
Though this has come into force, it does not mean that Africans will begin to see free trade movements across borders immediately. African states still require time to make necessary adjustments.
But this agreement is coming into force without Africa’s largest economy and most populous country, which is circumspect about AfCFTA implications on its economy.
The Manufacturers Association of Nigeria(MAN) is the biggest opposition to the AfCFTA as it argues that ratifying the agreement could kill industries in the country. The body with over 2,500 manufacturers says the country’s leadership is yet to do a cost-benefit analysis on the impact of the trade treaty on revenue, manufacturing and the general economy.
“Right from the period preceding the Kigali Summit and up until now, the content of the Nigerian offer has remained unknown to manufacturers who are the number one stakeholders to be positively and or negatively impacted by the proposition,” MAN said in Lagos in the second quarter of 2018.
But chambers of commerce in the country believe the treaty is more important to Nigeria than any other African country.
“Our position is that our dear country should sign the AfCFTA. While we continue to address the issues around it, and work on a strategy for implementation to tackle the problems, we should sign the agreement now,”Iyalode Alaba Lawson, national president of Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), said in Lagos in July 2018.
The Lagos Chamber of Commerce and Industry (LCCI) had, in late May 2018, backed the trade deal, arguing that if smaller African countries were not afraid of it, Nigeria with 200 million people and humongous $430 billion GDP, had no business shying away from inking it.
“I don’t see anything to be afraid of,” Babatunde Paul Ruwase, president of LCCI, said at a stakeholders’ consultative forum on AfCFTA in Lagos that month.
“If smaller countries are not afraid of it, we should have no fear to be there,” he added.
The AfCFTA treaty was signed by African Union (AU) countries on the 21st of March 2018 in an AU summit in Kigali, Rwanda.
However, the signing of the agreement still needed to be ratified by the parliaments of at least 22 member states of the AU to come into force. Nigeria and many countries in North Africa are still consulting and are being left out of the party.
A four-page analysis by BusinessDay in 2018 had argued that whether Nigeria signs the AfCFTA or not, African products will find their way into the country either by hook or by crook, being the largest market on the continent.
Smuggling is already a gargantuan challenge for Nigeria and refusal to sign AfCFTA will only more than quadruple it.