President of the African Export-Import Bank (Afreximbank), Prof. Benedict Oramah, has urged Nigeria to set up a specialised agency to enable it take advantage of the opportunities offered by the implementation of the African Continental Free Trade Area (AfCFTA).
Delivering a keynote address at a dinner and gala night organised to mark the 59th anniversary of Nigeria’s independence, Oramah said that such an agency should be the arrow head for achieving Nigeria’s strategic objectives for its membership of the AfCFTA.
According to him, Nigeria’s goal should be set out in a carefully developed strategy and entrusted to an accountable set of people to implement.
A statement from Afreximbank said Oramah described the AfCFTA as a platform for Africa’s collective self-reliance, adding that Nigeria had a great opportunity to benefit immensely from it if certain actions were taken at the federal, state and corporate levels in a coordinated manner.
He noted that while the promise of the AfCFTA in terms of development outcomes was not in question, the road ahead was likely to be rough and turbulent, adding that Nigeria should consider triggering an adjustment process for operators in sectors likely to be negatively impacted and putting in place arrangements to support those that could become competitive by simple retooling and transforming from import substitution to export orientation.
He also urged the government to make credible trade information available to Nigerian businesses interested in international trade, especially intra-African trade, arguing that while the AfCFTA creates the legal basis for a potential pan-African market in goods and services, the creation of that market was the job of economic agents whose operations were usually driven by information.
“Unless businesses and traders know where the markets for their goods are or where they can source inputs, they cannot participate fully in the market the AfCFTA is hoping to create,” he stated.
Oramah said that the strongest economic argument in favour of the AfCFTA was that it would help African economies to industrialise and improve the continent’s share of global manufacturing output, and advised that the medium to long-term goal for Nigeria and other African economies should be to achieve clearly defined levels of industrialisation.
“Available evidence shows that labour intensive light manufactures offer the greatest market opportunity for Nigeria,” he said.
With such products amounting to $60 billion of intra-African trade, and with China gradually moving away from their production and opening opportunities for African economies to replace the over $65 biillion in light manufactures it exports to Africa, Nigeria stood a very good chance of capturing a significant proportion of that market.
He added that with capital being hard to access, expensive and very short term in Africa when compared to most other parts of the world, an optimal industrialization strategy for Nigeria should be one that emphasised labour intensive industrialisation.
The Afreximbank president disclosed that the bank had agreed with the African Union (AU) to put in place a $3 billion AfCFTA Adjustment Facility, to which it had committed $1 billion while working to raise the balance from the markets.
The bank had also committed $500 million to members of the Manufacturers Association of Nigeria (MAN) in the context of helping companies think and act continental, to help them improve their equipment to make them export-ready.
Also speaking, Vice-President Yemi Osinbajo, who was the special guest of honour for the night, extolled the capacity of Nigeria and Nigerians to excel and do the country proud.
Indicating that Nigerians had every reason to be proud of their country, he cited the feat of the citizens who participated effectively in the bobsledding event during the last Olympic Games despite the fact that Nigeria is a tropical country with no snow, Nollywood’s dominance in the entertainment industry, and other pacesetting activities of Nigerians in many areas.