A special government panel has recommended that President Muhammadu Buhari sign Nigeria up for a landmark African free trade agreement, ahead of a key meeting of African leaders.
The panel was formed by Buhari in March last year to assess the impact of the African Continental Free Trade Agreement (AfCFTA) after Nigeria abruptly pulled out of signing the deal adopted by a majority of African nations.
“Our reports shows that, on balance, Nigeria should consider joining the AfCFTA”, the panel’s chair, Desmond Guobadia, said in a statement to the president on Thursday, after submitting the report.
The trade deal “provides immense opportunities for Nigeria’s manufacturing and service companies to expand to Africa”, Guobadia said.
The panel, however, recommended Buhari delay “liberalising” and ratifying the deal which would open Nigeria’s markets to the continent, in order to manage the agreement’s “negative impacts.”
“AfCFTA is not without major risks”, it said, warning that the deal could lead to increased smuggling and abuse of ‘rule of origin’ labels on products.
“The risk is that it will provide incentive for traders to disguise goods imported from outside the continent as made-in-Africa goods”, the report warned.
The continental pact which formally came into force last month represents an ambitious African Union(AU) plan that seeks to integrate and boost intra-African trade.
Nigeria had been a key backer of the plan for several years yet suddenly pulled out last March, days before other African countries endorsed the document at a summit in Rwanda.
Calling for more time to address concerns from business and labour unions, Buhari instead formed a panel to engage industries across the country on the impact of the deal on Nigeria.
“Our position is very simple, we support free trade”, Buhari said, “as long as it is fair and conducted on an equitable basis”.
Ahead of an AU summit of African leaders in Niger Republic next week, the AfCFTA will again be on the agenda with Nigeria widely expected by industries and labour unions in Nigeria to at least partially adopt the agreement.
The report “will form part of the consideration in our decision on the next steps on the AfCFTA”, said Buhari.