Africa, AfCFTA, The Private Sector and The Way Forward By Abdul Samad Rabiu

 

I start by congratulating African leaders on the opening of the AfCFTA secretariat last month. I believe the secretariat will further help to facilitate the prompt actualization of the AfCFTA vision.

As it is well-known, BUA is in the business of Foods, Mining, Manufacturing, and infrastructure. The fact that our manufacturing and mining businesses are mostly located in areas that are potentially primed for exports makes the continental free trade area attractive for us here at BUA. For instance, our Cement business in Sokoto, Nigeria is about 1,000kilometres to Ouagadougou, Burkina Faso and less than a 100kms from the border with the Niger Republic, and also our upcoming project in Adamawa is situated at a border town in Adamawa – very close to the Cameroonian border. We are already doing some exports and are putting up a third line in Sokoto with at least 70% of its output expected to be dedicated to Niger Republic & Burkina Faso. Based on these, we are, therefore, well positioned to take advantage of the agreement and this will also help drive the AfCFTA vision.

 

However, for the agreement to succeed, we believe a lot, including the following needs to be done and addressed.

Status of Current Regional Agreement

There is still a high level of distrust despite the overwhelming support for the AfCFTA. One of the causes has been the poor implementation of previous agreements, for example, the ETLS – The ECOWAS TRADE LIBERALISATION SCHEME and the EAST AFRICAN COMMUNITY

A situation where people cannot move goods produced in African countries where over 90% value has been added to other African Countries is a cause of concern. How do we intend to address these issues? What is the status of these regional agreements scheme going into the AfCFTA and how do we fix the issues that have beset it especially with regards to the free movement of goods and services, tariffs amongst other things.

Free Movement of People Within the Continent

For integration to be successful, we must facilitate free movement via liberalised air travel, operations, and visa-free regimes across the continent for businesses and individuals. Currently, it is more tedious to travel within Africa than from Europe to Africa. This is not the best for business or for integration.

The current situation where an Australian or European can easily enter an African Country unlike an African gives great cause for concern. As it currently stands, only 25% of Africans can travel visa-free to other African countries whilst another 20% can get visas on arrival. We understand that there are still pending issues with security amongst other things but the Free Movement Protocol of the AfCFTA needs to be pushed with renewed vigor.

Dumping

The lessons learnt from operating the current regional economic blocs are some of the biggest hindrances to the full acceptance of the CFTA. For instance, Nigeria with its huge population and large economy is a prime target for dumping from smaller neighboring countries however, these same countries do not permit the importation of some 100% produced in Nigerian goods whilst flooding Nigeria with goods/food imported from outside Africa. How do we protect import-dependent states and those with high populations from Dumping?

We understand the need to protect smaller nations and boost fair trade, however, measures must be put in place to prevent dumping and promote made in Africa by Africans for Africa trade rather than the current scenario whereby certain countries take advantage of these policies.

In Nigeria, we have seen it happen with rice and cheap imports from other countries being smuggled and dumped into the country. AfCFTA negotiations must take these into account. The final agreement should be crafted in ways to prevent goods produced and imported from outside Africa (above national consumption needs) benefitting from the pacts. This will in turn prevent the larger countries – and the continent, from becoming dumping grounds and make smaller countries with value on offer to be less protectionist in nature.

Proliferation of Small Arms & Illicit Drugs and Smuggling

Whilst I am in support of liberalizing the free movement of persons across the continent, it is important to acknowledge the security challenges we face from the proliferation of small arms and illicit drugs. This was one of the main issues I believe led Nigeria to close its borders with its neighbors. I daresay that the proliferation of arm, drugs, and smuggling go hand-in-hand. Both are crimes against the economic, physical, and territorial integrity and security of African Nations. More needs to be done in this regard.

Private Sector AU Partnership & the TransAfrican Highway

On private sector involvement, It is our opinion that the Private Sector should be invited by the Governments of Africa and the Secretariat to discuss the way forward for sustainable investments and partnerships.

For cross border trade to work, everyone – governments, private sector, and DFIs must be willing to collaborate fast to fix infrastructure to spur growth. BUA is interested in being part of a coalition that we urge the secretariat to put together on the development of the Trans African Highway, for instance.

As we all know, the Trans African Highway is a 56,600km road network conceived about 50 years ago to develop infrastructure and connect major African cities from North to South and East to West across 9 highways.

We can start by partnering with various governments and engage the Special Envoy for Infrastructure in Africa, H.E. Raila Odinga and take the Mombasa – Lagos Highway, for example, into consideration. The Lagos-Mombasa Highway 8 is about 6,259kms or 3880miles and is contiguous with the Dakar – Lagos Route.

I am personally ready to mobilise like-minded businesses across the continent with the resources required (steel, cement, etc.) to do these roads at a concession and guaranteed by sovereign African nations. This can be done with the private sector with support from governments and the DFIs.

If those roads are actualized, imagine the number of jobs that will be created as well as the amount of trade that will be facilitated as a result.

We are Interested in Knowing How BUA and the Private Sector Can Help Before AfCFTA Starts

At BUA, we are more than excited about the possibilities of the Free Trade Agreement for us, Nigeria, and the entire continent of Africa – now more than ever. The Africa Continental Free Trade Agreement, if actualized and harnessed properly, will help spur development and trade within Africa as we have never witnessed before. BUA is ready to partner with the secretariat and we are ready to pool our resources to see the continent succeed.

Finally, we are thankful for the visit of the Secretary-General to BUA. We pray the Almighty grants you success in your role and We are always ready to support the development of our dear continent. If AfCFTA succeeds, we all do. We are in this together.

RABIU, chairman of BUA Group, delivered this speechduring the visit of the AfCFTA Secretary-General, Wamkele Mene, to the BUA HQ in Lagos