LCCI: How Nigeria can be competitive in AfCFTA

The Director-General of the Lagos Chamber of Commerce and Industry, Muda Yusuf, has said that for the country to be relevant in the African Continental Free Trade Agreement, it needs to be competitive.

He disclosed this to Financial Street in Lagos on Thursday.

While underscoring the importance of competitiveness in AfCFTA, Yusuf stressed that this is the very foundation of any conversation about trade because those engaging in it, whether within or outside the country, have no sentiment about it.

He argued that if what one is providing is not competitive in price, it is of no relevance because the consumer is not interested in whether it is made-in-Nigeria or not.

“What one is interested in, is how he or she can maximise what we call ‘utility’ in economics, how he can maximise or benefit from the little money he wants to spend. So, that is why the emphasis has to be on how we can make ourselves competitive,” he said.

The LCCI boss recalled that the manufacturing sector kicked against AfCFTA, hence Nigeria was one of the last to ratify the agreement. 

“They have looked at all the things around them and said as far as production is concerned, there is no way they can compete. And you can’t blame them because you are the investor, you have committed capital, you have imported machines, have a lot of assets, many of them immovable and you put all these investments in place based on specific competitiveness assumptions.”

Yusuf, however, added that the parameters for the competitiveness have begun to change.

His words, “You have looked at the market, you have done some competitive analysis and said yes, this investment will fly. Now the assumptions have changed, the competition parameter is now changing; you are now facing new competitors. Meanwhile, the domestic environment has not changed, your tax environment has not changed, the port environment has not changed, the cost of funds, the regulations, the lending and all of that. The infrastructure issues are still there. So, it is a dangerous challenge.

“We have already ratified and so, hopefully and prayerfully, there will be no going back so that we don’t have the kind of thing we have in Brexit, after UK joined and said it is pulling out. I pray we are not going to get there because a whole lot of countries are much better prepared.

“It was because of this preparedness issue in 2018, that the President set up a Readiness and Impact Assessment Committee when the manufacturers  complained to know what exactly was needed to ensure that we are better prepared; to ensure that our stakeholders and investors can be part of this system and also benefit from the continental market.”

Yusuf said although the committee had done its investigations and submitted its report, nothing had changed.

“The committee was set up to look at the readiness issues, the committee submitted its report on readiness issues around the ports, around the aviation, road, power and around all the problems that investors are facing. The report has been submitted, the situation has not changed, nothing is even happening, the situation is even getting worse,” he stressed.

Anozie Egole
Anozie Egole
Anozie Egole is a Transport correspondent. He reports Maritime, Aviation and Rail/Road Transport for Financial Street.

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