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Nigeria may lose out of AfCFTA, becomes dumping ground ~Salami

By on December 4, 2020 0 123 Views

Nigeria would lose out in the implementation of the Africa Continental Free Trade Agreement (AfCFTA) unless its products could withstand international competition, according to the chairman of the National Economic Advisory Council, Doyin Salami.

Salami spoke at the meeting on the development of the Secured Agricultural Commodity Transportation and Storage Corridor (SATS-C) in Abuja, yesterday.

He predicted that the country could become a dumping ground for goods from other African countries if the costs of local production remained uncompetitive.

“It is important to bear in mind this issue of ACFTA and the reason is very simple – upside and downside.

“The upside is the access to larger market and that is only available if we, as a country, are prepared. As I am looking at it, Nigeria needs to be careful. If we are not careful, our output may even diminish on the back of AfCFTA.

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“Why? Because other countries with better and lower production costs will take advantage of our market which will become a disincentive to our farming community.

“Shutting borders does work to a point but it is not a long-term sustainable venture. Routes to market and infrastructure that drive trade are very important,” Salami said.

He said border closure was not a sustainable strategy, noting that Nigeria must take pragmatic steps to reduce the costs of production for its products to be internationally competitive.

He noted that agriculture accounted for more than 20 percent of the GDP, with more than 30 percent of the population are engaged in agriculture but that only a small percentage of those involved in the sector had access to market.

“Opportunities are there but the structural challenges are where we need to pay attention. Our export of agriculture produce is very small compared to our import,” making the nation a bet importer.

The economist said some people might be surprised at his comments, as the Chairman of the Presidential Economic Advisory Council, but that his position was the fact.

In his remarks, the Managing Director of the Nigeria Incentive-Based Risk Sharing System for Agricultural Lending, NIRSAL Plc, Aliyu Abdulhameed, said the SAT-C was designed in line with its mandate to fix broken agricultural value chains and increase the flow of finance into the sector.

He said a fully operational SATS-C policy could directly lead to a five percent increase in the agriculture sector’s contribution to national GDP by halving annual post-harvest losses of $12 billion.

In addition, the initiative would lower food prices, create over 125,600 direct and indirect jobs, and the heightened possibility of adhering to standards for improved access to export, industrial and consumer markets.

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