The secretary-general of the African Continental Free Trade Area (AfCFTA) secretariat, Wamkele Mene, has stated that the successful implementation of the trade agreement requires regular and consistent engagement with the private sector.
Mene stated this at an international conference, themed “African Continental Free Trade Area: Roadmap to a successful implementation hosted by the Lagos Chamber Of Commerce and Industry (LCCI).
Speaking virtually at the conference held on Tuesday, Wamkele said the private sector was the avenue for sustainable economic growth and development.
He added that in Africa, they account for 80 percent of the total production activities and that 90 percent of the firms within the African private sector are micro, small, and medium enterprises (MSMEs).
He said to successfully implement the trade agreement, all member states must actively engage with the private sector, allow them to share their experiences, and also find a solution to challenges that hinder business activities.
It is also necessary to position SMEs favourably. SMEs are the real traders, the real investors and the real job creators who are responsible for moving goods and services across borders.” he explained.
Speaking on the Rules of Origin (RoO) requirement, Mene said the document was drafted to avoid the influx and sale of products that are not made in Africa, noting that the document is at 80 percent completion with all other sectors except for the automobiles, sugar, textiles sectors.
Victor Liman, director-general Nigerian Office for Trade Negotiations said the trade agreement was aimed at increasing intra- African trade from between 15 and 17 percent to 35 or 50 percent, which will provide a market size of about 600 million people.
He added that the SMEs constituted a major percentage of the trade community, and as such, they are critical for the successful implementation, but will need enabling policies and conditions to thrive.
“MSMEs need special funding interventions with lower interest rate and longer tenures to participate, because if the tenure is short and the interest rate is too high, the overhead cost will skyrocket, returns on investment will be very low and entrepreneurs will be pressured.
There is also the need to review some regulations and policies which have become impractical overtime and will hurt trade activities between member countries.”
Liman added that regulatory agencies involved in the trade agreement among member countries must understand their role and act accordingly, while also cooperating with the trade participants.
Liman, who doubles as the acting chief trade negotiator, stated that it was necessary to avoid mistakes made during the ECOWAS Trade Liberalisation Scheme (ETLS), in order to fully reap the benefits of AfCFTA.
He added that implementation conditions, compliance, and rigorous enforcement were major factors that will act as enablers for the smooth execution of the trade agreement in Nigeria.
Niyi Adebayo, minister for Industry, Trade, and Investment, said AfCFTA presented opportunities for Nigerian businesses to expand operations which can be championed by the private sector.
Adebayo, represented by Francis Anatogu, secretary, national committee on AfCFTA, said “Our implementation of AfCFTA will achieve sub-optimal results unless we mobilise all economic actors at every level of the society, we, therefore, want to build economically viable communities” he said.
Adebayo said the Federal Government was working relentlessly to mitigate the challenges of the trade deal through the domestication of the AfCFTA agreement, provision of quality infrastructure, implementation of programs to aggregate SMEs for export trading, etc.
In her remarks, Toki Mabogunje, president, LCCI stated that while some African countries have started to trade on the platform, Nigeria and some other countries were yet to commence trading.
This, she said, raises concerns as to how the aims of the trade agreement will be actualised, as critical parts of the agreement were yet to be finalised.
“Several Key issues including schedules of tariff concessions, schedules of service commitment, rules of origin, investment, competition policy, and intellectual property rights have not been concluded.
There is still lack of clarity on the type of value addition that must occur within an AfCFTA State party for a product to benefit from tariff reduction,” she said.