To enjoy the opportunities offered by the implementation of the African Continental Free Trade Area (AfCFTA), the President of the African Export-Import Bank (Afreximbank), Prof. Benedict Oramah, has urged Nigeria to set up a specialized agency for the project.
Delivering the keynote address at the 2019 Independence Day Dinner and gala night organised by the Federal Government of Nigeria to mark the 59th anniversary of the country’s independence in Abuja, Prof. Oramah said that such an agency should be the arrow-head for achieving Nigeria’s strategic objectives for its membership of the AfCFTA.
According to him, Nigeria’s goal should be set out in a carefully developed strategy and entrusted to an accountable set of people to implement.
He described the AfCFTA as a platform for Africa’s collective self-reliance and said that Nigeria had a great opportunity to benefit immensely from it if certain actions were taken at the federal, state and corporate levels in a coordinated manner.
He noted that while the promise of the AfCFTA in terms of development outcomes was not in question, the road ahead was likely to be rough and turbulent, saying that Nigeria should consider triggering an adjustment process for operators in sectors likely to be negatively impacted and putting in place arrangements to support those that could become competitive by simple re-tooling and transforming from import substitution to export orientation.
Oramah also urged the government to make credible trade information available to Nigerian businesses interested in international trade, especially intra-African trade, arguing that while the AfCFTA creates the legal basis for a potential pan-African market in goods and services, the creation of that market was the job of economic agents whose operations were usually driven by information.
“Unless businesses and traders know where the markets for their goods are or where they can source inputs, they cannot participate fully in the market the AfCFTA is hoping to create,” he stated.
The Afreximbank President said that the strongest economic argument in favour of the AfCFTA was that it would help African economies to industrialize and improve the continent’s share of global manufacturing output, and advised that the medium- to long-term goal for Nigeria and other African economies should be to achieve clearly defined levels of industrialisation.
“Available evidence shows that labour intensive light manufactures offer the greatest market opportunity for Nigeria,” he said. With such products amounting to $60 billion of intra-African trade, and with China gradually moving away from their production and opening opportunities for African economies to replace the over $65 billion in light manufactures it exports to Africa, Nigeria stood a very good chance of capturing a significant proportion of that market.
Oramah added that, with capital being hard to access, expensive and very short term in Africa when compared to most other parts of the world, an optimal industrialization strategy for Nigeria should be one that emphasised labour intensive industrialization.
He announced that Afreximbank had agreed with the African Union to put in place a $3 billion AfCFTA Adjustment Facility, to which the Bank had committed $1 billion while working to raise the balance from the markets. The Bank had also committed $500 million to members of the Manufacturers Association of Nigeria, in the context of helping companies think and act continental, to help them improve their equipment to make them export-ready.
Also speaking, Prof. Yemi Osinbajo, Vice President of Nigeria and the special guest of honour for the night, extolled the capacity of Nigeria and Nigerians to excel and do the country proud.
Indicating that Nigerians had every reason to be proud of their country, he cited the feat of the citizens who participated effectively in the bobsledding event during the last Olympic games despite the fact that Nigeria is a tropical country with no snow, Nollywood’s dominance of in the entertainments industry, and other pacesetting activities of Nigerians in many areas.