Nigeria risks becoming a dumping ground under AfCFTA, experts warn

Nigeria’s preparedness to effectively participate in the African Continental Free Trade Area (AfCFTA) has come under scrutiny, with experts warning of the country’s vulnerability to becoming a dumping ground for goods from other African nations due to infrastructural deficiencies.

Segun Musa, vice president of Air and Logistics at the National Association of Government Approved Freight Forwarders (NAGAFF), raised these concerns while addressing the nation’s readiness for the continental trade agreement.

He pointed out that sustainable production is critical for any nation to benefit from AfCFTA, but Nigeria is hindered by several deficiencies. “We lack key enablers such as stable energy supply, advanced technology, reliable infrastructure, and adequate security,” he said.

According to data from the World Bank, Nigeria’s power supply averages just 4,000 megawatts for a population exceeding 200 million, affirming a significant barrier to industrial competitiveness.

With manufacturing contributing only 8.9 percent to Nigeria’s GDP in 2023, Musa argued that the country’s participation in AfCFTA will likely be limited to importing goods from other African nations rather than competing effectively in the export market. “We have no competitive advantage to leverage in the continental market,” he said.

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To reverse this trend, Musa advocated for a focus on supporting local production for export. “We need to begin to identify and support entrepreneurs in production, provide them with liquidity, and ensure their products meet certification standards for both local and export consumption,” he said.

He further criticised regulatory bodies such as the Standards Organisation of Nigeria (SON) for their perceived inefficiency in improving manufacturing standards. “Most of their activities are just talk shows and paper presentations. If the government is serious, they should focus on practical dialogue and strategies to achieve results,” he added.

Despite his criticisms, Musa expressed optimism that Nigeria could still benefit from AfCFTA if the government prioritises actionable strategies. He highlighted the agreement’s potential to expand intra-African trade, which is expected to grow by 52.3 percent by 2035, according to the African Union.

“AfCFTA is a continuous market, and it is not too late for us to harness its benefits. However, this depends on the government’s interest in ensuring we have something tangible to offer,” he stated.

The AfCFTA agreement, which came into effect in 2021, aims to create a single market for goods and services across Africa, fostering intra-continental trade and economic integration. However, experts like Musa warn that without deliberate efforts to address internal challenges, Nigeria may miss out on the benefits of this historic trade pact.