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The Federal Executive Council has given President Muhammadu Buhari the nod to sign Africa’s Continental Free Trade Agreement, in Kigali, Rwanda, on March 21st, 2018
At launch and when in force, the AfCFTA shall be the largest Free Trade Area (FTA) in the global economy, by number.
FEC believes that the continental body is expected to allow for greater economic and political integration under the continental free trade areas and will improve the level of trade amongst African countries from the current level of 13% to a higher one.
Nigeria is also expected to explore the 1.2b African market in favour of the country, while also dealing with issues of dumping of goods and services in the country.
The signing of the agreement will come up at an extra ordinary meeting of the African Union, involving the Heads of states and government in the Rwandan capital late March.
Minister of Trade, Industry and Investments, Okechukwu Enelama and Foreign Affairs Minister, Geoffrey Onyeama, at a joint briefing after the weekly Federal Executive Council meeting presided over by Vice President Yemi Osinbajo, disclosed that FEC also gave the nod for Nigeria to lobby for the secretariat of the continental body
The decision to establish the African Continental Free Trade Area (AfCFTA) was taken in 2012 by all Heads of State and Government of the African Union (AU) at their 18th Ordinary Session as a first step in the implementation of AU Agenda 2063: the “Vision” for an integrated, prosperous and peaceful Africa.
But the actual negotiation for the AfCFTA were launched at the AU Johannesburg Summit in 2015.
The negotiations had involved resolving issues on trade on goods and Services and rintellectual property, competition policy and investment.
During the Extraordinary Summit of African Union Heads of State and Government to be held on 21st March 2018 in Kigali, Rwanda, Heads of State and Government shall “adopt, sign and launch the African Continental Free Trade Area”.
The Ministers noted that the signing of the agreement to establish the AfCFTA will launch the “Single Liberalized Market for Trade in Goods and Services”.
“The AfCFTA is a negotiated rules-based system, to establish the rule of law in trade, deepen, and expand intra-Africa trade from its very low base of 14%
Nigeria is expected to gain in market access for exporters of goods and services, spur growth and boost job creation.
The wider market access is also expected to reduce barriers against Nigeria’s products and provide a dispute Settlement Mechanism for stopping the hostile and discriminatory treatment directed against Nigerian natural and corporate business persons in other African countries
The country will also benefit from the rules-based trade governance in intra-African trade to invoke trade remedies, such as safeguards, anti-dumping, and countervailing duties against unfair trade practices, including dumping, trans-shipment of concealed origin of products.
Government also see a strong support for the industrial policy of Nigeria through the negotiated and agreed “Exclusion and Sensitive category lists” to provide space for Nigeria’s infant industries, as well as Improve competitiveness, the enabling environment for business, consolidate and expand Nigeria’s position as the number 1 economy in Africa.
It is also projected that an estimated 8.18 percent increase in Nigeria’s total exports, with a small structural shift in Nigeria’s economy towards manufacturing and services will emerge and it is expected to lead to a total increase in Nigerian economic welfare by 0.62% – equivalent to around US$2.9 billion in 2018 terms. Changes would result from tariff reduction, ease of doing business and, trade facilitation.
The Ministers are also optimistic that it will create a strong platform for Small and Medium Enterprises (SMEs) integration into the regional economy and accelerate women’s empowerment, as well as an expanded platform for Nigerian manufacturers and service providers for connection to regional and continental value chains.
Tony Ailemen, Abuja
