Africa’s Business Community Should Explore Opportunities
— Yusuf
Muda Yusuf, Director General, Lagos Chamber of Commerce and Industry, which is also Nigeria’s premier and foremost chamber of commerce, shares his thoughts on the African Continental Free Trade Area (AfCFTA) agreement. In this interview, he spoke on the yawning opportunities the continent offers. Excerpts:
The African Continental Free Trade Area agreement officially came into force on May 30, 2019. What is your view on the free trade agreement?
First of all, it is very disheartening that Nigeria is not yet part of it, because we are the biggest economy on this continent. I do not think that we should be shying away from competition at the continental level. I believe that if we can be part of ECOWAS, we can also be part of this process. In matters like this, it is easier for the people who are part of the discussion and negotiation to shape the protocol in a way that suits them and addresses their concerns.
The AfCFTA agreement is a good thing. It presents opportunities for accessing a big market, economies of scale and the enhancement of the welfare of the people because competition brings about improvement in welfare for consumers in any set up. It is also good in the sense that it will give opportunities to investors outside of manufacturing to explore new markets. From the Nigerian point of view, we should not limit our focus to manufacturing, which accounts for less than 10 percent of our GDP. We have competitive advantage in other sectors, particularly the service sector, especially in entertainment, IT, and the financial services industry.
Do you think that Africa is ready for it?
We are. We have been talking about economic integration for a very long time. Already, a lot of progress has been made at the regional levels. So, going to the continental level with the AfCFTA is taking it higher to ensure that we have a much bigger platform for investment and trade within the continent.
Why then, is Nigeria foot-dragging?
Perhaps the leadership of the country is not yet convinced that we should be part of it. The manufacturers’ association is pushing the rejection of the project. Rightly or wrongly, they have the ears of the President. Their concern is about competitiveness. They fear we may lose our manufacturing sector. But my view is that their fear is overstated, especially if we are talking about competitiveness within the African business environment. Already, a good number of Nigerian manufactured products are finding their ways into some West African countries and they are not doing badly.
How prepared is Nigeria’s industrial sector to compete in a border-less African market?
I won’t say that we are fully prepared. But the truth is that unless you step into it, you will never be prepared. Sincerely, this is just another protectionist argument that the only way to promote industrialization is to protect the local industry. This has over the years become the only policy instrument the country has been relying on to promote industrialization. But whether it has worked for us or not is there for everybody to see. Protectionism can only complement other more fundamental factors. You cannot rely exclusively on protectionism and get the kind of industrialization you want. We have not made good progress because we are emphasizing the wrong things like protectionism to the neglect of things like infrastructure, access to finance etc.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry.