- Manufacturers flay FG’s cold approach
Almost one year after the commencement of trading under the African Continental Free Trade Area (AfCFTA) agreement begun with Nigeria yet to join the list of countries trading fully, there are indications that the country’s economy would lose about $1.18 billion (N566 billion) by the end of the year.
Indeed, a document from the Nigerian Office for Trade Negotiation (NOTN) titled: “An Independent Study on the Potential Benefits of African Continental Free Trade Area (AfCFTA) on Nigeria,” cited by New Telegraph, revealed that AfCFTA would enable all African Union (AU) countries (55) to share in the welfare gains estimated at around 2.64 per cent of the continent’s Gross Domestic Product.
This translates to roughly $65 billion at the end of this year if all the 55 participating countries in AfCFTA started trading fully with one another under the continental trade scheme
In addition, this also indicates that each country among the 55 countries in AU would share $1.18 billion in 2021.
NOTN reported in the document that the continental trade treaty was expected to buoy Africa’s Gross Domestic Product (GDP) to achieve $25 trillion by 2050 with Nigerian market being the major pivot to contribute the largest to the continent’s GDP. In addition, the NOTN document stated that Af- CFTA ratification was worth about $3 trillion in continental free-trade zone encompassing 1.2 billion people in the continent.
However, the report stressed that Nigeria was expected to enjoy economic advantages in the areas of expanding market access for local exporters of goods and services, spurring growth, boosting job creation for teeming youths, tariff reduction, ease of doing business and trade facilitation.
The same document also stated that AfCFTA is expected to lead to a total increase in Nigerian economic welfare by 0.62 per cent- equivalent to around $2.9 billion, mostly being driven by manufacturers and Micro and Small and Medium scale Enterprise (MSMEs).
However, the malaise in the resolution of the implementation of AfCFTA relating to issues surrounding market size, economic size, diversity, supply chains opportunities, foreign exchange, trade policy, Customs, tariffs difference, rule of origin, HS codes and others are yet to be sorted out and addressed amicably for the continental trade agreement to be a success.
While reacting to the NOTN’s report on AfCFTA, the Minister of Industry, Trade, and Investment, Otunba Richard Adeniyi Adebayo, disclosed that it’s very germane and critical for African countries’ leaders to collectively agree on the full implementation of AfCFTA.