Assent to the Free Trade Area Agreement
Recently, President Muhammadu Buhari appended his signature to the African Continental Free Trade Area Agreement, AFCFTA.
The African Continental Free Trade Agreement’s aim is the creation of a single market for goods and services among the African Union countries.
This free trade area has the potential to impact positively on the economy of African countries.
The removal of trade restrictions in Africa would ensure free flow of goods and services, increase volume and value of Africans within the continent.
The agreement will also promote free movement of business persons and investments, pave the way for accelerating the establishment of the continental customs union and the African customs union.
Apart from this, it will enhance competitiveness at the industry and enterprise levels through exploiting the market to scale up production, continental market access and better reallocation of resources.
At this juncture, it is worth mentioning that, Nigeria with the largest economy in Africa with a population of two hundred million people should be the biggest beneficiary of the market.
For instance, Nigeria cannot compete favourably with manufacturers from other countries without stable power supply
Power, according to experts, adds almost 40 per cent to cost of production in the country and any plan to boost the manufacturing sector without an efficient power sector would be an exercise in futility.
Also, one of the merits in belonging to this group is the hope of attracting foreign investment.
To actualize this, government should deal with fears about the ease of doing business which include the legal framework for business operation, the length of time for registering a business and the complaints about multiple taxation of businesses.
The appalling state of road, rail infrastructure and insecurity in the country should also be looked into.
For Nigeria to reap the benefit of the agreement, issues such as activities of smugglers, porosity of the nation’s borders need to be put under control.
the details of the agreement should be such that the local industry would not be exposed to unfair competition with incoming goods.
To this end, there should be strong resolve measures to protect the country against abuse of trade protocols.
Furthermore, the country need to invest heavily in technology-based border policing and surveillance as channel to protect the country.
Nigeria need to identify areas of competitive advantage over other african countries and good use of it.
While promotion of small and medium scale enterprises should be paramount.
It behoves the government to make Nigeria the best place in which to do business,as there are enormous economic benefits the country can derive from this agreement