With the signing of the African Continental Free Trade Area (AfCFTA) agreement by President Muhammadu Buhari at the opening of the African Union (AU) Summit yesterday in Miami, Niger, Nigeria has joined the AfCFTA.
President Buhari signed the treaty at exactly 10: 47am in the presence of African Heads of States and Governments, delegates and representatives from the private sector, civil society and the media attending the 12th Extraordinary Summit of the AU Launch of the Operational Phase of the AfCFTA.
According to a statement by his Special Adviser on Media and publicity, Femi Adesina, the President, after signing the agreement, declared that Nigeria’s commitment to trade and African integration had never been in doubt nor was it ever under threat.
He told the Summit that Nigeria will build on the event by proceeding expeditiously with the ratification of the AfCFTA.
The statement reads: ‘‘Nigeria wishes to emphasise that free trade must also be fair trade. As African leaders, our attention should now focus on implementing the AfCFTA in a way that develops our economies and creates jobs for our young, dynamic and hardworking population.
‘‘I wish to assure you that Nigeria shall sustain its strong leadership role in Africa, in the implementation of the AfCFTA. We shall also continue to engage, constructively with all African countries to build the Africa that we want.’’
Buhari also congratulated Ghana on being selected to host the Secretariat of the AfCFTA.
President Buhari went on: “I have just had the honour of signing the agreement establishing the African Continental Free Trade Area (AfCFTA), on behalf of my country, the Federal Republic of Nigeria.
‘‘This is coming over a year since the AfCFTA Agreement was opened for signature in Kigali, Rwanda, at the 10th Extraordinary Summit of the AU, on 21st of March 2018.
‘‘In fact, you will recall that the treaty establishing the African Economic Community was signed in Abuja in 1991.
‘‘We fully understand the potential of the AfCFTA to transform trade in Africa and contribute towards solving some of the continent’s challenges, whether security, economic or corruption.
‘‘But it is also clear to us that for AfCFTA to succeed, we need the full support and buy-in of our private sector and civil society stakeholders and the public in general.
‘‘It is against this background that we embarked on an extensive nationwide consultation and sensitization programme of our domestic stakeholders on the AfCFTA.
‘‘Our consultations and assessments reaffirmed that the AfCFTA can be a platform for African manufacturers of goods and providers of service to construct regional value chains for made in Africa goods and services.
‘‘It was also obvious that we have a lot of work to do to prepare our nation to achieve our vision for intra-African trade which is the free movement of ‘made in Africa goods.
‘‘Some of the critical challenges that we identified will require our collective action as a Union and we will be presenting them for consideration at the appropriate AfCFTA fora.
‘‘Examples are tackling injurious trade practices by third parties and attracting the investment we need to grow local manufacturing and service capacities.’’
President Buhari noted that Nigeria’s signing of the AfCFTA and its Operational Launch at the 12th Extraordinary Summit was an additional major step forward on the AU’s Agenda 2063.
With Nigeria and Benin Republic signing the Agreement at the Summit, 54 out of 55 African countries have signed the world’s largest free trade area deal, encompassing 55 countries and 1.2 billion people.
Eritrea is the only country yet to sign the agreement.
Twenty-six countries have deposited instruments of ratification, with Gabon being the latest after depositing hers during the Extraordinary Summit.
The AfCFTA Agreement entered into force on May 30, 2019, 30 days after having received the 22nd instrument of ratification on 29 April, 2019 in conformity with legal provision.
African leaders launch free-trade zone
The Continental Free-Trade Zone (CFTZ) launched yesterday by African leaders will create $3.4 trillion economic bloc, usher in a new era of development and unite 1.3 billion people.
After four years of talks, an agreement to form a 55-nation trade bloc was reached in March, paving the way for yesterday’s African Union (AU) summit in Niger.
Attendees are to unveil which nation will host the trade zone’s headquarters, when trading will start and discuss how exactly it will work, it was learnt yesterday.
It is hoped that the AfCFTA – the largest since the creation of the World Trade Organisation (WTO) in 1994 – will help unlock Africa’s long-stymied economic potential by boosting intra-regional trade, strengthening supply chains and spreading expertise.
Egyptian President and AU Chairman Abdel Fattah al-Sisi at the summit’s opening said: “The eyes of the world are turned to Africa.
“AfCFTA will reinforce our negotiating position on the international stage. It will represent an important step.’’
Africa has much to do: its intra-regional trade accounted for just 17 per cent of exports in 2017 as against 59 per cent in Asia and 69 per cent in Europe.
The continent has missed out on the economic booms that other trade blocs have experienced in recent decades.
Economists say significant challenges remain, including poor road and rail links, large areas of unrest, excessive border bureaucracy and petty corruption that have held back growth and integration.
Members have committed to eliminating tariffs on most goods, which will increase trade in the region by between 15 per cent and 25 per cent in the medium term.
But this would double if these other issues were dealt with, according to the International Monetary Fund (IMF) estimates.
The IMF, in its May report, described a free-trade zone as a potential “economic game-changer” of the kind that has boosted growth in Europe and North America, but it added a note of caution, saying: “Reducing tariffs alone is not sufficient.’’
Africa already has an alphabet soup of competing and overlapping trade zones – ECOWAS in the west, EAC in the east, SADC in the south and COMESA in the east and south.
But only the EAC, driven mainly by Kenya, has made significant progress toward a common market in goods and services.
These Regional Economic Communities (REC) will continue to trade among themselves as they do now.
AfCFTA has a mandate to liberalise trade among those member states that are not currently in the same REC, said Trudi Hartzenberg, Director at Tralac, a South Africa-based trade law organisation.