Ex LCCI DG tips compliance to rule of origin as biggest challenge in AfCFTA regime


…Lists other factors that could mar trade

The outgone Director General of the Lagos Chamber of Commerce and Industry (LCCI), Dr. Muda Yusuf has said that although there are general issues around, compliance to the rule of origin is one of the biggest challenges that is foreseeable in the successful implementation of the African Continental Free Trade Area (AfCFTA).

Yusuf who stated this at an event in Lagos recently pointed out that even in the Economic Community of West African States (ECOWAS), the customs were grappling with the problems of rule of origin as people would bring goods from China and repackage them in Benin and label them as coming from West Africa adding that they created a whole lot of problems even for domestic industries because of the level of ethics.

While acknowledging the existence of the non-tariff barriers, he observed that there were some domestic regulations that some countries would put deliberately to make it difficult for one to come and do business in their country.

According to him, “Of course, they have ratified AfCFTA, the tariff has been removed but how about this domestic regulation? They can put it deliberately to frustrate trade. So, non-tariff barrier is a big issue.

“I know what big companies go through in trying to move their products across West African sub-region, the kind of headache they face from all the security agencies from Togo to Benin to all of them along that corridor just as our security agencies also give people headache including those of us that are even Nigerians, we know what we face. You clear your cargo, after clearing, all the hurdles within the ports, you don’t have any cause, people will still meet you on the road.

“So, issue of transport is key because there cannot be effective trade if there is no good connectivity. You have to move things either by rail, road or by sea. If there is no good connectivity, there cannot be effective trade. So, that also needs to happen.

“Trade logistics and more of that, documentation processes, all those things need to be looked into. And we also need to be conscious of the need to develop indigenous capacity. We hardly talk about it, we only talk about investment. Sometimes if you have investment and the whole people is overrun by some people from Asia and all of that, you will not get as much value as if our own people too are part of it.

“We talk about maritime; if we have much traffic we generate in terms of shipping, how many indigenous players are playing in that sector? How many investors who are indigenous ship owners are lifting crude or take in all these PMS and all of that? Indigenous participation is very key in economic development, we should not just go to them and say we want investment, how much of these investments are also owned by Nigerians?

“I am not saying we should chase away people, you know I am from Chamber of Commerce, we welcome foreign investors and domestic investors but there have to be deliberate policy around indigenous investors to mainstream them in this sector, support them so that they can also take advantage so that this industry doesn’t become a destination as a market, it should be a destination for investment.”

He went on to state that the general concerns of stakeholders were concerns around the issues about energy, taxation, quality of infrastructure – the seaports, railway system, issues of dumping, piracy and of course, gender mainstreaming.

On impact readiness assessment earlier conducted to determine countries’ readiness for continent-wide trade, the former LCCI boss disclosed that South Africa, Morocco and Egypt were tipped in the report as countries that were most ready for the AfCFTA by virtue of what they were doing especially in the area of export – manufactured, value added export not export of primary products.

“And in any case, look at the structure of our export now, it is about 95% oil and gas in terms of value and when you are talking about trade, it is not about import and export? So, what do we have to put on the table in terms of the non-oil export? What policies do we have because I don’t know whether we already have an AfCFTA strategy? Every country is developing theirs, this is our strategy for AfCFTA to plan how you can gain and take advantage of AfCFTA. But the strategy is good on paper, we need to translate it and that is where all of us need to do something”, he pointedly said.

Photo; Immediate past Director General, Lagos Chamber of Commerce and Industry (LCCI), Dr. Muda Yusuf.

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