Increasing Volume Of Cross Border Trade Worries FG
The growing volumes of informal cross-border trade in West Africa is a worry to the Nigerian government whose economy has borne the brunt.
Informal cross-border trade is trade activities between neighbouring countries conducted by small unregistered traders.
The government described the volume of such informal exports between Nigeria and the neighbouring African countries as unprecedented, noting that it has distorted the national budget.
The Chief Executive Officer, Nigerian Export Promotion Council (NEPC), Ezra Yakusak disclosed at a workshop on cross border trade in Lagos.
Yakutsk, who was represented at the forum by the NEPC Regional Coordinator, Samuel Oyeyipo explained that one major characteristic of informal trade was the high-profit margin by the traders but which does not translate to tax revenue for the government.
He explained that the operators in this market avoid government tariffs and failed to follow laid down procedures and documentation.
What worries the government more is that a large number of the operators have strong ethnic ties and historical linkages in their societies.
“Large scale informal trade has a serious fiscal implication. It affects the government budget adversely and it retards economic development. The reduction of impediments to trade in the formal channel and having simple export incentives schemes would attract the informal traders to formalise their exports.
“ I will recommend that we focus on the Informal Cross-Border Trade (ICBT) in West Africa and how we can harness the potentials it presents and leverage on it for utmost participation in the African Continental Free Trade Area agreement.”
The executive director noted that in as much as cross border trade could either be formal or informal, depending on the angle of the event wanted to focus on, there were border markets that were key hubs of social and business exchange in border regions and with very particular characteristics consequent to their specific locations at the crossroads of the major trade flows through West Africa.
According to him, these trade hubs around border regions were the spring for informal trade and export in West Africa sub-region.
However, he said that it was imperative to have a formal cross border trade activity especially as it relates to exports.
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