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Creation of continental free trade area may kill surviving Nigerian industries—Expert

Contrary to the permutations of the Federal Ministry of Finance and the Nigerian Customs Service (NCS) that the enthronement of Continental Free Trade Area (CFTA) will grow manufacturing in Nigeria and the country will gain more from intra-African trade, leading development economist, Dr. Ken Igboanugo has voided the claims.

In his submission against the belief within the government quarters, he said “Considering the state of infrastructure and access to industrial funding facility, it will be very difficult for any Nigerian based factory to produce goods that can have a truly competitive price with products from other African nations where factors of production are cheap”.

“Goods manufactured in Nigeria will find it hard to meet both quality and competitive price floor if they enter African free trade market because whereas similar products from other countries will be cheaper, those from Nigeria will tend to be costlier because the production conditions in Nigeria are very hostile and that is why many hitherto foreign firms have relocated to neighbouring countries where factors of production are seamless.

It would be recalled that the Federal Government had on Tuesday during the opening of the first extra-ordinary meeting of the African Union Sub-committee of Directors-General of Customs in Abuja averred that there was need for the African Union Commission to quickly establish the CFTA so as to encourage intra-African trade.

Minister of Finance, Mrs. Kemi Adeosun, said the CFTA, when established, would promote the utilisation of African products and improve the economic status of its citizens.

She said while the activities of Customs at the borders could make or brake an economy, there was a need for the leadership of Customs in each African country to come up with innovative ways to expedite the movement of goods and services.

According to her, “The African Union’s objectives of fostering unity, promoting economic growth and enhancing security, among others, find expression in what Customs administrations of the AU are about to do here.

“It will be appropriate here to urge you and the AU Commission to take on board the issue of 0.2 per cent import levy and come out with clear guidelines for implementation by member states as a permanent source of funding for the activities of the AUC.”

Earlier in his welcome address, the Comptroller-General of Customs, Col. Hameed Ali (rtd), said the outcome of the deliberation would  make business processes simpler, faster and improve the economic fortunes of the continent and Nigeria in particular.