Despite signing the African Continental Free Trade Area (AfCFTA) agreement in 2019, Nigeria has fallen behind its regional counterparts in fully harnessing the benefits of intra-African trade. The sluggish progress in intra-African trade can be attributed to limited information available to manufacturers and bureaucratic obstacles hindering their participation in the ambitious trade pact.
Neighbouring countries such as Rwanda, Cameroon, Egypt, Ghana, Kenya, Mauritius, Tanzania, and Tunisia have already started operating under the AfCFTA, having met the minimum requirements for trade. Practical trade activity under the agreement commenced in September 2022, witnessing the export of coffee products from Rwanda to Ghana and Exide Batteries from Kenya to Ghana under the Guided Trade Initiative (GTI).
During a two-day capacity-building training for members of the Manufacturers Association of Nigeria Export Promotion Group (MANEG), Odiri Erewa-Meggison, Ag. Chairman of MAN Export Promotion Group, highlighted Nigeria's delay in implementing the AfCFTA. The training, themed 'Exporting under the AfCFTA,' aimed to equip MANEG members with the knowledge to capitalize on the potential trade benefits offered by the agreement.
The United Nations Economic Commission for Africa projected that AfCFTA could increase intra-Africa trade by 52 percent by 2022, but this target remains unmet. Franca Achimugu, Coordinator of Strategy & Planning at AfCFTA Nigeria Secretariat, emphasized the need for Nigeria to encourage domestic production to saturate its domestic market. She also highlighted the economic viability of exports and the importance of positioning Nigeria as an attractive market for other African countries.
However, challenges such as inadequate infrastructure, connectivity issues across borders, bureaucratic hurdles, customs delays, and regulatory barriers have slowed Nigeria's trade integration and competitiveness. These factors have led to increased costs and reduced opportunities for businesses within the country.
To fully tap into AfCFTA's potential, experts suggest that Nigeria needs a proactive and strategic approach. This includes diversifying its export base, promoting domestic industries, and investing in innovative sectors to enhance competitiveness in the global market.
In contrast, neighboring countries have made significant progress in leveraging AfCFTA's benefits. They have witnessed increased cross-border investments and trade partnerships, enabling them to expand their market reach and boost economic growth.
For Nigeria to fully embrace AfCFTA and reap its advantages, a concerted effort is required to address the identified challenges and implement policies that foster a conducive environment for trade and economic growth. By actively participating in regional trade and addressing internal hurdles, Nigeria can position itself as a significant player in the dynamic and evolving African marketplace.