Manager of Lagos Deep Offshore Logistics Base, Amy Jadesimi, has called on African governments to make the African Continental Free Trade Agreement a mechanism for local industrialisation.
As Africa’s largest economy, the most populous black nation, the largest crude producer and cultural powerhouse, Nigeria has long been seen as essential to any pan-African deal, which has had broad support among business leaders across the continent.
But President Muhammadu Buhari heeded calls from Nigeria’s trade unions to study the deal’s effects before signing.
According a statement by LADOL spokesman, Olakunle Kalejaiye, the company’s manager is one of the few among the Lagos business elite to support Buhari’s deliberative approach because of how important the deal is.
“We need a continental-focused solution that is developed by the African Union and targets making the trade agreement a mechanism for local industrialisation,” Jadesimi told newsmen in an interview, according to the statement.
“That should be the aim of this trade agreement, rather than just something broad and high level about economic growth or prosperity – those things won’t come, if, underlying all of this, we do not create jobs and lift our economies through industrialisation,” she added.
Supporters argue that AfCFTA has the potential to spur economic growth in a bloc of nations with a combined Gross Domestic Product of more than $3tn, creating the world’s largest free trade zone.
But major challenges remain, and sceptics such as Jadesimi argue that any pact must offer incentives to boost African manufacturing or it will fail – an outcome that could turn the continent into a dumping ground for cheap Chinese, American or European goods.
“Are we going to create an entirely new paradigm for trade that is Africa-centric, that is controlled by African countries, and that disincentivises foreign companies and countries outside the continent from importing? That’s going to be really tricky,” manager of the Lagos-based industrial free zone said.
The AU summit in Niger last July was a landmark moment for the pact whose roots stretched back to decades.
Beyond the issue of whether the cost of an open market outweighs the benefits to specific countries, there is also the question of whether it is possible for Africa to overcome its structural challenges to trade.
The agreement aims to remove 90 per cent of tariffs to create a single market with free movement of goods and services.
However, sceptics question how under-resourced governments – newly deprived of that tariff revenue –will be able to upgrade poor infrastructure.