Good people, many months ago, as President Buhari was contemplating signing AfCFTA, the pan-African trade agreement, I wrote that Nigeria was not ready because the rules of origin could be rigged by member states. My conclusion in that piece was thus: fix the rules of origin clause before signing AfCFTA. Of course, after pressure on Mr. President, he signed. But it seems that reality has checked in as ECOWAS has become a lab even before AfCFTA.
Nigeria should SIGN but must make sure the “rule of origin” clause is strong. We cannot afford goods produced outside Africa to be repackaged in a treaty member state and then shipped to Nigeria at a low tariff that is exclusive to member states.
Here are the evolving conditions which Nigeria’s neighboring countries must adhere to and maintain before the closed land borders could be opened. You can extend this redesign to AfCFTA even before it begins. Simply, Nigeria is fixing the rules of origin, at the moment.
– Any import coming from outside an ECOWAS region and imported into an ECOWAS member state must maintain its original packaging. They must be escorted from the port directly to the designated entry point in the Nigerian border, presented to the Nigerian customs with their original packaging. Compromises will not be tolerated.
– Goods produced predominantly in ECOWAS member states must satisfy the ECOWAS rules of origin to avoid any possibility of downplay. Goods must be majorly produced in ECOWAS countries.
If the goods are coming from outside ECOWAS, the value addition must be over 30 per cent for it to be accepted within the framework of the Economic Trade Liberalisation Scheme that ECOWAS countries have to promote trade among them.
This is to avoid countries outside member states from exporting their goods into ECOWAS region repackaged, as though they are coming from an ECOWAS region.
– All warehouses along the shared borders of Nigeria must be dismantled.
– Goods being transported must be put in proper recognized packaging. No longer will we have goods of all shapes and sizes going through the borders. To maintain the best practices of those goods, an accepted condition for packaging will be established.
– In regards to free movements of persons, all persons moving through Nigerian borders must present themselves through recognized entry points and must have recognized travel documents (country passport).
Interestingly, AfCFTA could just be a paper with no heart to make it happen as anyone losing can activate anything to justify exclusion. Because the bigger economies like Nigeria will not like to lose, I do not see how harmony can reign. Yes, I do not expect an engagement with Togo from Nigeria to be a win-win; unless Nigeria is open to lose marginally, there is nothing in it because the economic disparity is highly asymmetric. Of course, Nigeria has to do what it has to do, as it battles eroding middle class, even as population continues to grow, in a time of very low economic growth. But do not sleep thinking AfCFTA will be magical – it is already collapsing before it begins!------
Register for next edition of Tekedia Mini-MBA (June 22 - Oct 22, 2020) here. Four months, online, and costs $140 or N50,000 naira .