After initially expressing concerns in joining the pact, Nigeria has finally agreed to sign the long-planned Africa Continental Free Trade Agreement (AFCFTA). The continent’s largest economy announced that it will sign the agreement at the upcoming African Union summit scheduled to take place this weekend on July 7 in Niger.
Nigerian President Muhammadu Buhari stated on social media that they do consider the trade agreement as an important step for Africa as it would undoubtedly boost manufacturing across the continent.
The Nigerian presidency also reiterated that the free trade agreement would only work if it was fair and was conducted in an “equitable basis.”
Nigeria initially expressed its reluctance to join the pact amid fears that it would be exposing its already robust manufacturing sector to greater competition.
The country had launched its own impact assessment of the trade agreement last month to determine if it would ultimately be good for Nigeria as a whole.
Nigeria also stated that it needed to consult with its local stakeholders before it decides to commit to the agreement. After reviewing its findings, Nigeria finally decided to climb on board.
Africa’s manufacturing sector currently accounts for around 10 percent of the African Union’s total $3.4 trillion gross domestic product (GDP). If the AFCFTA brings together all of the Union’s members, it could essentially increase the output of its manufacturing sector by making them more competitive and productive.
Cameroon and South Africa are among the first of the 52 countries that signed the AFCFTA. As of May this year, 52 out of the 55 African Union states have signed the agreement.
The long-planned AFCFTA was initially put into force back in May, following months of procedural hurdles. The agreement has since been ratified by the parliament s of 24 African countries. Ghana and Kenya were the first countries to deposit their ratification instruments in May of last year, with Sierra Leone and the Saharawi Republic followed suit in April of this year.
Some issues within the agreement, such as concession agreements and rules of origin, are still being ironed out with planned negotiations.
The goal of the agreement is to bring in all of the 54 members of the African Union to unify trade between its 1.2 billion-strong population.
The ultimate aim of the AFCFTA is to remove all trade barriers between the nations, allowing trade without tariffs across the whole continent. The AFCTA is expected to significantly boost regional trade within the continent by allowing companies to expand into new markets without any financial and political hurdles.
