HOW NIGERIA’S MANUFACTURING SECTOR CAN ENJOY EFFECTIVE AFCFTA PARTICIPATION

 In Investor News

The development and strategic positioning of Nigeria’s manufacturing sector is necessary for the country to enjoy the benefits that the Africa Continental Free Trade Area (AfCFTA) has to offer. Unfortunately, despite expressing willingness to participate in the trade agreement by signing it in 2019, Nigeria is yet to participate or make transactions on the platform due to series of challenges hurting local producers of goods.

Nigeria’s counterparts are however making efforts to effectively utilize the trade platform for economic gains. Although many of them are being propelled by available resources and infrastructure to carry out the provisions of the pact. Toki Mabogunje, President, Lagos Chamber Of Commerce and Industry (LCCI) president while speaking at an international conference on AfCFTA, noted that Nigeria is yet to participate in the trade agreement three months after commencement despite the many months spent preparing in anticipation of the pact.

She said as a result, Nigeria is losing out on the gains of cross border trade and this may threaten the speedy economic recovery that the country anticipates. Similarly, Similarly, Muda Yusuf, director-general, LCCI, said participation in the trade agreement will be challenging for local manufacturers, due to the different challenges bedeviling the sector, adding that the government is in a better position to help manufacturers by providing an enabling environment to make Nigerian manufacturing sector competitive.

The Manufacturers CEOs Confidence Index (MCCI) for Q4 2020 compiled by Manufacturers Association of Nigeria (MAN) highlighted five major challenges hurting manufacturer’s performance. Sector players also affirm that these challenges have hindered their ability to participate in the trade agreement and therefore called for the government’s prompt response in tackling these issues.

IMPROVED INFRASTRUCTURE

Nigeria lacks the necessary infrastructure needed to grow businesses, especially developed transport systems as Roads are decrepit and although rails are coming up, they are not connected to the nation’s seaports. Nigeria requires $15Bn (N5.8Tn at N390 to a Dollar) worth of investments annually for 15 years in order to adequately develop its infrastructure according to reports from the Financial Derivatives Company, an economic and financial research firm.

However the possibility of fulfilling that is quite slim considering allocated budget for infrastructure in the country, coupled with the dwindling rate of foreign investment into the country.

ACCESS TO PORTS

In Nigeria, access roads to premier seaports in Apapa and Tin Can, Lagos, is plagued by gridlocks, hurting export and import, in addition to lack of functional scanners by the Nigeria Customs Service, which causes untold delays of raw materials to factories and exports to destination countries.

Read more at: https://businessday.ng/real-sector/article/how-nigerias-manufacturing-sector-can-enjoy-effective-afcfta-participation/

 

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