Nigeria to Sign AfCFTA Agreement: A long awaited decision

0
AfCFTA: Key to Africa’s Recovery and Prosperity?

Recently, after rounds of consultations, the Nigerian government finally announced its intention to sign the Africa Continental Free Trade Area (AfCFTA) agreement at the upcoming African Union (AU) summit in Niamey. Although the decision might appear belated, it was largely expected, as major stakeholders within the country had favoured the deal with some few concerns.

The agreement which is aimed at boosting Intra-Africa trade had gained further grounds over H1-19 as it went into effect on May 30th, 2019. However, the operational phase of the deal is set to kick-off this weekend, with member countries committing to free movement of goods and services that has the potential to ignite economic integration and increase capital flows into African economies.

Source: AU, United Capital Research

While the economic benefit of the deal is clear for Nigeria, infrastructural challenges are expected to pose a threat to the materialization of these benefits. We believe plans towards constructing an efficient transportation system and power generations need to be acted upon, to serve as automatic solutions to the ease of doing business challenges and a reduction in operating costs, which can drive up real sector growth. In all, we believe efficiency is key for Nigeria to produce value-added goods that can compete regionally with other African players.

United Capital Plc Research (UCR)