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Nigeria: Between trade agreements and poverty impact

This Day (Lagos) | April 3, 2007

Nigeria: Between Trade Agreements and Poverty Impact

By Abimbola Akosile

The European Commission and the African, Caribbean and Pacific (ACP) partner countries have agreed to conclude trade talks by the end of the year.

After meeting with delegations from six African, Caribbean and Pacific regions at a 7th ACP-EU Joint Ministers of Trade Committee Meeting on March 1 in Brussels, Belgium, EU Trade Commissioner Peter Mandelson said the two sides agreed that their present trade arrangements must end and new ones compatible with World Trade Organisation (WTO) rules be put in place.

Mandelson also reportedly insisted that the extension of the 2007 deadline is not the EU decision, but in the hands of the WTO. Rather than anticipate failure, he advised the ACP to concentrate efforts at finishing by 2007 so as not to send wrong signals to other members of the WTO. He however admitted that if the negotiation does not finish this year, there are options available which he termed as expensive and not so good.

EPAs talk about cooperation agreements between the ACP and the European Union (EU), and free trade between both regions. ACP comprises the African, Caribbean and Pacific countries, and there are presently 78 of them, including Nigeria. The EU formerly had 15 countries, but now their number has increased to 25 member countries. Most ACP countries are former colonies of the EU member countries.

The WTO, led by Mr. Pascal Lamy, its Director General, agreed to allow the EU to continue preferential trade with African, Caribbean and Pacific countries only until the end of 2007.

Colonies’ Standpoint

However, the ACP nations are seeking for more time to consider and build up their development agenda, taking into consideration the bi-lateral and pluri-lateral negotiations. ACP member nations do not want partial solutions to their problems. Instead they seek differentials and modalities that consider benefits to them.

There are various implications the agreements would have on the ACP economies which are small and developing. 43 of those countries are Least Developed Countries. In the ECOWAS region, only three out of 16 countries are non-LDCs, namely Nigeria, Ghana, and Cote D’Ivoire. Experts claim there is lop-sided dynamics in the agreements between the ACP countries and the EU.

The negotiations and implementation on said agreements have been also derided by the civil society structure in the West African sub-region as capable of under-mining desired regional integration. The Federal Government has been urged to exclude the Singapore issues from all future discussions in order to protect the country from trade disadvantages.

The contentious Singapore issues include trade investment policy, competition policy, government procurement policy, and trade facilitation; issues which the ACP countries have always disagreed over when negotiating with the European Commission.

An Impact Assessment (IA) conducted in Nigeria revealed that the EPAs would pose a major challenge for Nigeria. By December 31, 2007, the study revealed that Nigeria would have lost about $487million while the EU conversely would have gained about $908million out of the country.

National Gender Policy

The Federal Government has approved the National Gender Policy in pursuance of gender equality and children welfare in the country. This was disclosed recently by the Minister of Women Affairs and Social Development, Hajia Maryam Ciroma.

The approval was based on the Beijing (China) platform for action, which required government to generate and disseminate gender-related data and information for planning and evaluation; as part of an institutional mechanism to advance the conditions of women and children.

There is also a Nigerian Gender Statistics Digest 2006, which relates to the female gender and is based on data collection from both primary and secondary sources, combined with series of workshops on gender information management, and analysis of data, among others.

Poverty Implications

The Abuja consultative workshop, which was organised by Oxfam GB, Nigeria, wanted the assembled participants, mainly gender-based organisations, agricultural and trade groups, to focus on the potential impact of the EPAs and trade on the poor in Nigeria, most of whom are women and children.

Maisha Stroizer, Oxfam’s country director, claimed the issue of trade and impact on gender and poverty in Nigeria was timely, even in this period of approaching election.

She claimed international trade, through economic agreements, are potentially powerful tools for addressing poverty in the world, and increased trade which drives globalisation, provides wealth and prosperity for western nations and emerging economies like China and India, while contributing to poverty for millions of the world’s poorest.

Stroizer also maintained that millions of people around the world who work hard to grow food and make textiles, and mine the oil and minerals that fuel economies know that the problem is not trade, but unfair trade rules and practices that favour richer nations.

She called for greater focus on the development implications of the partnership agreements and revealed that EPAs would substantially impact the sustainable development of the ACP region. EU is the largest trading partner for most ACP countries with nearly 40% of all ACP exports going to it; and EPAs would affect 39 of the world’s 50 least developed countries (LDCs) and the lives of over 720 million people who live in the ACP region, most of them women and children.

Stroizer also called on ACP governments, including Nigeria, to seek input from relevant trade unions and other stakeholders before embarking on reforms that weaken the policy environment for equitable economic growth and development; with decisions on trade policies to be based on sound research on the implications for jobs, families and communities.

Gender Perspectives in Nigeria

According to a gender perspective of poverty in Nigeria, poverty has a feminine face, which has been proved by quantitative and qualitative data and extrapolations based on characteristics of poverty.

Affected poor groups include predominantly rural dwellers, those in riverside and remote areas, the poorly educated, those in the informal sector occupations and poorly paid wage earners, widows and the aged; where popular socio-economic groupings show that women are more prominent than men among these groups.

Poverty alleviation has been a major thrust of national budgets since 1996, and government often cite increasing equity and the related objective of reducing poverty as the reasons for greater involvement in social service provision.

In the perspective, four approaches to defining poverty were named including monetary, capacities, social exclusion, and the participatory approaches.

Poverty, based on the combination of different approaches, is phenomenon with many dimensions and causes, which include material, non-material, subjective and cultural necessities.

An analysis showed that poor women outnumber poor men, poverty affects men and women in different ways, and gender is a factor, just like age, ethnic factors and geographical location.

Nigeria is Africa’s most populous nation, with an estimated 140 million inhabitants and a population growth of 2.5% annually. It is the largest country in sub-Saharan Africa and the tenth most populated country in the world with approximately 49% of the population being women.

Despite her wealth of human and natural resources, Nigeria is ranked among the 13 poorest countries in the world, with two out of three citizens living below the extreme poverty line of less than $1 or N128 per day.

Trade Deliberations

Aside goodwill messages from concerned stakeholders at the forum, five presentations were made, all of which focused on the EPAs and its implications on gender and poverty among the poor population, described as nearly 70% of Nigeria’s 140 million population size.

In the first presentation, which is a general overview of context, challenges and current state of the EPAs, Mr. Adetunji Babatunde, an academician from the University of Ibadan (UI), Oyo State, took participants through the entire gamut of the negotiation process, from its past efforts and current stand-off and agreements.

He recommended a re-alignment of the EPA liberalisation programme with the ACP integration process as a vital solution or option to the challenges posed by the EPAs to the ACP countries; a delay of the opening of ACP markets to the EU until the achievement of complete intra-regional integration; and an effective safeguard mechanism for ACP countries to use if faced with a surge of subsidised EU imports.

Babatunde also called on each of the six ACP regional groups to make its own decisions on the timing, pace, sequencing and product coverage of market opening in line with individual countries’ national development plans and poverty reduction strategies; and also for ACP regional EPA groups to adopt the same common external tariffs (CET) against non-ACP imports.

Calling for EPAs to be accompanied by additional resources to enable the ACP countries benefit from trade reforms and build their export competitiveness, the researcher urged EU to be ready to provide an alternative to an EPA at the request of any ACP country.

Mr. Inye Briggs of the Federal Ministry of Commerce and Industry in Abuja and a member of the nation’s negotiating team, claimed the EU is trying to play ACP countries against each other and that it would be futile to conclude the present trade negotiations by 2007.

He called for three more years of deliberations, even while advising that Nigeria should not sign the partnership agreements; a move which would probably scuttle the whole process in the West African sub-region, given Nigeria’s huge and attractive market and her purchasing power for potential EU imports.

Briggs called on Nigeria to take a more pro-active stance on the EPAs negotiations, to increase liaison and cooperation to influence the activities of the ECOWAS Secretariat; and to seek more ways to influence the negotiations, which are dynamic.

Other presenters included Dr. (Mrs.) Folasade Ayorinde of the International Labour Organisation, who gave an overview of poverty in Nigeria from a gender perspective; Mrs. Opeyemi Abebe of the Nigeria Export Promotion Council who spoke on the impact of trade agreements and EPAs on gender and poverty in Nigeria; and Barrister Ken Ukaoha, President of the National Association of Nigerian Traders (NANTS), a key member of the West African Civil Society working on Trade and Development.

Ukaoha, also a member of Nigeria’s negotiating team albeit from a civil society constituency, enjoined development partners to focus more attention on Nigeria so as to strengthen her bargaining powers through adequate capacity building at all levels (State and Non State Actors) and improved mobilisation and sensitisation of the civil populace on the EPA.

The NANTS president, who convened a recent West African Ministerial Monitoring Committee Meeting on the EPAs in Abuja, claimed even the alternatives to EPAs appear similar to the current EPAs and pointed out the need for more advocacy on the trade agreements so that Nigeria and other ACP countries can get the best outcomes from the current negotiation and subsequent EPAs implementation.

Ukaoha, who is planning another stakeholders meeting on the EPAs called on civil society groups across West Africa to mount more pressure on their governments so that the development context can be highlighted during the negotiations; and called for media advocacy and checking of sharp practices among women, which affect trade within and outside Nigeria.

Timely Warning

Deliberations are ongoing both within the West African region, in the other five ACP regions and in the EU itself; with each group seeking ways to obtain the best advantages for its products come January 2008, when the implementation of EPAs is expected to commence.

Nigeria has been actively involved in the negotiation so far, which is expected given its large market size and potential economic and industrial back-lash in the wake of any shoddy agreement. The struggle for better trade conditions is not for the civil society alone. Other players in the private sector, banking industry, even in the lucrative oil industry need to be involved, to avoid bearing the brunt of a lop-sided trading process.

However, before the negotiations are agreed and signed, Nigeria and other West African countries need to critically consider the issues of common external tariffs, regional integration, local product protection, and development packages for their citizens. That is the ideal agreement.