For MD/CEO, Abx World Limited, Captain John Okakpu, the African Free Trade Area (AfCFTA) has the potential to lift millions of people out of poverty and end food insecurity on the Continent, including Nigeria.
According to him, in spite of the enormous advantages African countries can leverage, Nigeria has not been positioned as the ‘real’ stakeholder for agro-export under this agreement.
Okakpu stressed that the country’s participation and gain from AfCFTA, in the agricultural value chain, depends on the effectiveness and implementation of government policies, especially in the agricultural sector.
How Nigeria Can Gain From AfCFTA — Abx World’s Okakpu
He said that AfCFTA will form a $3.4 trillion economic bloc, which Nigeria cannot afford to be out.
The UNCTAD reports that trade between African nations in agricultural products as a percentage of Africa’s total agricultural trade remains below 20 percent, one of the lowest in any region. Total trade between African nations was only 2 percent in the period 2015–2017, compared with 67 percent in trade between European countries, 61 percent in Asian countries, and 47 percent in the America.
“Now, AfCFTA intends to change the narrative. It has created the world’s largest free trade area, representing the 1.2 billion consumer market, and mandates states to remove tariffs and non-tariff in order to boost shipments and services between nations and boost economic growth in doing so.
“If you look at the trend, Africa exports agricultural products such as tomatoes, onions, vegetables, cocoa, coffee, cotton, yam tobacco and spices to the nations of the world to earn significant foreign exchange. But the continent imports important foods such as cereals, vegetable oils, dairy products and meat in large quantities.
“Now, our neighboring countries have positioned themselves to benefit from AfCFTA by building robust logistics and cost-effective export systems. So, looking at it critically, our logistics cost cemented our losses on AfCFTA unless we address it now, ”Okakpu explained.
Understanding AfCFTA Agreement
AfCFTA is a strategic framework adopted by 54 African countries to eliminate or reduce tariff and non-tariff barriers amongst themselves.
By doing this, the African countries believed that they would collectively build a single market for goods and services, facilitated by movement of persons in order to deepen the economic integration and prosperity.