COMMUNIQUE ISSUED AT THE END OF A STAKEHOLDERS’ FORUM ON AFRICAN CONTINENTAL FREE TRADE AGREEMENT (AfCFTA) ORGANISED BY THE LAGOS CHAMBER OF COMMERCE AND INDUSTRY (LCCI) AT THE COMMERCE HOUSE, 1, IDOWU TAYLOR STREET, VICTORIA ISLAND, LAGOS ON THURSDAY 24TH MAY, 2018.
The Lagos Chamber of Commerce and Industry (LCCI) in fulfilment of its public policy advocacy mandate, organised a one-day stakeholders’ forum on the African Continental Free Trade Agreement (AfCFTA) on Thursday, 24th May, 2018. The forum was chaired by LCCI President, Mr. Babatunde Paul Ruwase, FCA with the Director General/Chief Negotiator, Nigerian Office for Trade Negotiation, Ambassador Chiedu Osakwe and various stakeholders as a Special Guest. The meeting was well attended by leaders of Business Membership Organisations (BMOs), trade associations, trade missions and economic attaché of some embassies, manufactures and captains of industries.
The African Union agreed in January 2012 to develop the AfCFTA and it took eight rounds of negotiations, beginning in 2015 and lasting until December 2017, to reach agreement. Nigeria played a leading role from start to the end of the Negotiation.
AfCFTA is set to create one of the Largest free trade area in the World. It creates a single continental market for goods and services as well as a customs union with free movement of capital and business travelers. Analysts’ believes that this agreement will potentially give birth to the world’s largest free trade area since the World Trade Organization which was formed in 1995. This is in terms of the number of countries, covering more than 1.2 billion people and about $4 trillion in combined consumer and business spending if all 55 countries in Africa join the agreement.
AfCFTA has elicited diverse reactions from the Nigerian private sector since March 21st , 2018 when the historic agreement was signed by forty-four (44) African countries in Rwandan capital, Kigali. Nigeria and South Africa, the largest two economies in Africa are yet to sign the trade agreement as it believes that the economic and security implications of signing the deal must be further discussed by widening consultations among key domestic players.
Following concerns about the adequacy of the consultation process of the trade agreement, therefore, Nigeria’s involvement in AfCFTA was temporarily paused to enable broader consultation with stakeholders of the nation’s economy as efforts are ongoing to engage stakeholders in a consistent and iterative manner to enable informed decision prior to the expiration of the 6-month probationary window for reentry to the agreement.
Therefore, to progress the consultation process, LCCI organized a one-day forum for stakeholders, with the Chief Trade Negotiator / DG National Office for Trade Negotiations (NOTN), Ambassador Chiedu Osakwe, in attendance. The forum extensively discussed various aspects of the AfCFTA and adopted the following decisions:
Feedbacks from the Forum
- Participants took note of the presentation made by the Chief Trade Negotiator / DG National Office for Trade Negotiations (NOTN), Ambassador Chiedu Osakwe on the processes of AfCFTA’s background, architecture, design and mechanics, as well as the inherent benefits.
- The main argument against the signing of the AfCFTA was stakeholders’ fear of numerous bilateral trade agreements of some AU countries with the rest of the world and Nigeria’s underdeveloped industrial & infrastructural profile. It was argued that this Agreement will potentially make Nigeria a dumping ground due to our uncompetitive manufacturing sector, large market size and population.
- It was noted that for trade to be effective and benefit from the AfCFTA existing trade focused bodies such as the Nigerian Diaspora Direct Investment Summit, National Trade Consultative Committee and the Nigerian Industrial Policy and Competitiveness Advisory Council should be bolstered, with trade and infrastructure interconnected.
- Stakeholders proposed that safeguards be put in place for the Nigerian economy and sensitive sectors on transshipment, dumping and expected surge of import.
- Stakeholders proposed an effective framework for the enforcement of Rules of Origin.
- Concerns were expressed on the prevailing disconnect between regulatory agencies and policy inconsistencies among countries on the continent. Participants called for policy coherence and the reinforcement of interconnectivity between agencies to protect consumers and the Nigerian economy, as well as, enhance interface between, trade, investment and governance.
- Deep concerns about lack of data on trade within the continent and likely negative effect of poor statistics on the implementation of AfCFTA was expressed.
- There were calls for women entrepreneurs to actively engage the process and voice their perspectives on how AfCFTA affects them and their businesses different from their male counterparts.
Conclusion and Next Key Steps
- It was concluded that though the opportunities in AfCFTA outweigh the drawbacks but the necessary safeguards, systems, soft and hard infrastructures including viable ICT policies must be activated to maximize the potential benefits such as;
- Consumers and market right of access to multiple and diversified products and services
- Protection against abusive and injurious parties in and outside Nigeria based on ongoing capacity expansion of trade laws
- Investment opportunities for innovative Nigerian entrepreneurs
- Global best practices through standardization of processes, products and services
- The LCCI commits to working with the Director General/Chief Negotiator, Nigerian Office for Trade Negotiation, Ambassador Chiedu Osakwe and take leadership in developing appropriate messaging on policy advocacy on consumer protection to sharpen standardization process.
- The LCCI in conjunction with NOTN should profile investment opportunities and robustly engage investors and consumers on the conduct of the agreement on potential trade benefits.
- LCCI Women Group should articulate and submit a memo on women specific trade needs for consideration by NOTN.
- NOTN should initiate a standalone Consultation Committee to oversee routine stakeholders engagement and also clearly articulate all the inherent risks in the agreement with proposed mitigating measures available for consumers and business for clarity.
- Data assessment should be a permanent and continuous process helpful to the deployment of effective mechanism, trade policy, monitoring and coordinating.
- There should be a robust framework for continuous consultation and feedback on the agreement and this should be strengthened to accommodate an extensive media campaign process to forestall further disconnect with relevant stakeholders.
The forum closed by commending Nigerian President, His Excellency, Muhammadu Buhari, GCFR for his decision to deepen consultation with unions and businesses to assess the risks an open market in Africa would pose to the Nigeria’s manufactures and the SMEs. The forum also commended Ambassador Chinedu Osakwe, the Chief Negotiator of this Agreement for the inclusive consultative process and his disposition to listen and accommodate the views of industry players.
Lagos Chamber of Commerce and Industry [LCCI]