Nigeria may miss October trading date for AfCFTA
Nigeria may miss October trading date for AfCFTA
The Guardian | 18th October 2023
By Tobi Awodipe
From all indications, Nigeria may likely fail in its bid to commence trading in the African Continental Free Trade Area (AfCFTA), under the Guided Trade Initiative (GTI). This is because not all the requirements have been met yet. Nigeria had missed the former commencement date two months ago and now, is on the verge of missing the October deadline.
In August this year, the Executive Secretary, National Action Committee (NAC), African Continental Free Trade Agreement (AfCFTA), Segun Awolowo, had said all was set for Nigeria to join the second phase of the GTI. That is not however, the case. The GTI is a solution-oriented approach that aims to facilitate trade between interested state parties by connecting businesses and products for export and import.
This is coming almost three years after the implementation of AfCFTA, which came into force on January 1, 2021, and commencement of the GTI in October last year. Despite several promises, conferences and announcements, Nigeria continues to lag behind in making the trade agreement operational owing to structural challenges, lack of consensus on trade protocols and strategy among stakeholders.
Though the country continues to express readiness to commence trading, the actions do not match the words. Seven countries, including Rwanda, Cameroon, Egypt, Ghana, Kenya, Mauritius and Tanzania stated trading under the GTI framework in a pilot phase. Nigeria promised to join phase two and while that has kicked off two months ago, the NAC said the nation is still waiting for the official launch to go ahead from the Accra, Ghana–based AfCFTA Secretariat, despite the fact that not all the requirements have been met.
The NAC said Nigeria has met seven of the eight requirements, even though state parties are required to meet all eight requirements. The outstanding checklist requirement is the gazetting of Nigeria’s schedule of tariff concessions or tariff offers. Saying that the process is ongoing, the committee said they have gone ahead still, to identify businesses that have shown keen interest in trading under the GTI.
The NAC stated that, in view of this, and working in active collaboration with the Nigeria Customs Service, Federal Ministry of Industry, Trade and Investment, Manufacturer Association of Nigeria (MAN), Nigeria Association of Chambers of Commerce, Industry, Mines, and Agriculture (NACCIMA) and Nigerian Export Promotion Council (NEPC), have carried out Rule of Origin (RoO) inspections under the AfCFTA on interested businesses, which are now getting ready to be issued Certificates of Origin and trade under the GTI.
Intra-African trade has always been very poor and has only worsened in recent times, while trade between African countries and Asia and the rest of the world, continues to soar. Bottlenecks, multiple taxation, poor logistics including other factors, continue to threaten the initiative. Compared to India for instance, where only three compulsory documents are required for import-export processing, Nigeria’s customs requires 12 legal documents and numerous illegal documents to process intra-African goods and services.
With intra-African trade at about five per cent, the AfCFTA and subsequently, GTI, were supposed to address this challenge and boosts this number, yet, the initiative has struggled since its inception a few years ago.
