MAN Prepares Members For Stiff Competition With AfCFTA
GILBERT EKUGBE
The Manufacturers Association of Nigeria (MAN) has told operators in the real sector to brace up for tougher times when the African Continental Free Trade Agreement (AfCFTA) commences fully later in the year.
The president, MAN, Engr. Mansur Ahmed said although, expectations are high that the country would gain from the agreement, however, the results of the country-specific studies commissioned by MAN and the Government presented compelling evidence that the AfCFTA would have some backlashes on the Nigerian economy, especially the manufacturing sector.
The MAN boss at a zonal sensitization workshop on AfCFTA said the Federal Government took the right step by not signing the Framework Agreement largely based on the observations of MAN that the mode of deriving the National Negotiation Mandate and recommendation to sign the Agreement lacked private sector inputs, maintaining that the directive of African Union (AU) on composition of National Negotiating Team was not adhered to and there was no empirical study that could guide the country to make an informed decision on AfCFTA.
He stated that MAN also interrogated the justification for the adoption of 90:10% Market Access ratios without a well-thought-out ‘Rules of Origin’ (RoO) and the call for Nigeria, where manufacturers operate in a high-cost operating environment, to liberalize within 5 years as Non-Least Developed Countries (LDCs), while other African Countries classified as LDCs & Special categories were to liberalize in 10-15 years.
According to him, these concerns, including others not mentioned and the need to address them were constructively presented to the Federal Government and that led to Nigeria’s non-signing of the Agreement in Kigali, Rwanda.
“As you are aware, prior to signing the AfCFTA Framework Agreement on July 7 2019, at the 12th Extraordinary Session of the Assembly of the African Union in Niamey, Niger Republic, Government had addressed some of our concerns and promised to resolve others before and in the course of implementation. Right from the onset, MAN recognized the imperativeness of creating a beneficial Free Trade Area for export of the products of members and has strongly worked assiduously to promote the articulation of evidence-based positions on AfCFTA. In this regard, the leadership of MAN has always ensured that the position of the Association is thorough and extensively validated through our internal consultative processes,” he said.
He pointed out that trade experts worldwide generally agree that every trade agreement comes with economic gains and pains, adding that the report of the study commissioned by MAN revealed compelling low points.
“Import will surge in all the manufacturing sectoral groups as tariff cuts would trigger increases in import. However, the high point, is that Nigeria has a huge export market potential in a wide range of goods, specially manufactured products in many countries including South Africa, Togo, Cote d’Ivoire, Senegal, Ghana and many more when the framework agreement is fully implemented,” he said.
“I, therefore, implore you all to dispassionately share your thoughts and actively participate in the interactions that would produce a balanced position that will enable your Association firm up its advocacy roadmap, design appropriate business advisory services for members in readiness for the implementation of AfCFTA and strategically position the manufacturing sector in Nigeria for a beneficial Continental Trade. I am therefore hopeful that together, we can chart the course for a robust manufacturing agenda for Nigeria that would support intra-African trade and promote greater trade in manufactured products that have predominantly African contents,” he said.
Also speaking at the event, the Director, Sectoral Department, MAN Headquarters, Lagos Adeyemi Folorunsho, said considering these developments, MAN was concerned that the implications of ECOWAS Ministers of Trade (ECOMOT) approving the MA tariff schedule for AfCFTA as it was for the consideration of Meeting of ECOMOT then on the 4 th – 5 th Dec. 2019, without bringing on board the preferences of Nigeria and priority products already itemized by MAN, will inflict avoidable injuries on the economy, investments and the manufacturing sector in Nigeria.
To address concerns raised on the Market Access (MA), he said ECOWAS should ensure that, at the minimum, 24 and 41 tariff lines identified by MAN which are strategic to Nigeria but were lumped in the Liberalized list, be moved to the Exclusion and Sensitive baskets of ECOWAS respectively.
“Otherwise, the gains the country has recorded in its economic diversification and industrialization drive would be reversed. ECOWAS must ensure that items with zero trade value in ECOWAS list should be removed from the exclusion list adopted by ECOMOT and therefore create space to accommodate tariff lines that are of priority to Nigeria; present economic, social and political justifications using yardsticks like investment, production, employment, landmass, government policies etc., as the reason why ECOWAS cannot afford not to include products of priority to Nigeria in MA Tariff schedule for trade in goods,” he recommended.
Director, Economics & Statistics, MAN, Oluwasegun Adewale Osidipe, stated the need for manufacturers to participate effectively in the activities of the Implementation Committee (NAC) on AfCFTA and make meaningful input into the action plan for AfCFTA implementation, facilitate capacity building in the understanding of the Rules of Origin and the Trade Remedy Mechanisms and advocate that Government consistently see to the improvement of critical infrastructure, facilitate increased understanding of AfCFTA implementing Agencies/Trade Facilitators (Customs, NEPC, SON, NAFDAC, etc) on the
He said MAN is confident that Nigeria will excel in the agreement if greater attention is given to addressing the operating environment-related challenges.
“We must jointly advocate that Government should as a matter of priority take steps to enhance the competitiveness of the private sector and focus on addressing the various issues raised in the report of the Presidential Committee on the Assessment of the impact and the readiness of Nigeria for AfCFTA,” he added.
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