AfCFTA: Standardisation gaps may restrict gains for Nigeria

AfCFTA: Standardisation gaps may restrict gains for Nigeria


Based on a ThisDay newspaper report, stakeholders in the agri-business sector have expressed concerns that the lack of a standardisation policy for the country may deny Nigeria the much-expected benefits of the African Continental Free Trade Area (AfCFTA) agreement.

The stakeholders lamented that Nigerian SMEs appear unprepared to take advantage of the opportunity presented by the AfCFTA agreement because they are yet to adopt current global best practices. The director general, Nigeria Agri-Business Group (NABG), Manzo Maigari, noted that compliance and alignment with the global benchmark for standards and trading is currently lacking among Nigerian businesses. According to him, in modern business and trade, people need to be sure of the quality, sanitation, and hygiene of what is being sold to them before access to their markets is allowed, and this is what is lacking in Nigerian products.

The AfCFTA trade deal, which was operationalized on 1 January 2021, creates a borderless market for African products. The agreement requires immediate removal of tariffs on 90% of goods while an additional 10% of goods classified as “sensitive goods” would be negotiated later. As of January 2022, 41 countries of the African Union’s 54 member states (excluding Eritrea) had deposited their instruments of AfCFTA ratification. Specifically for Nigeria, the agreement is expected to open the African market for key manufacturing companies in the country to support export sales whilst also raising the prospects of attracting foreign direct investment across the manufacturing value chain.

However, despite implementing the trade agreement, which originally should allow for the elimination of tariffs for the movement of most goods among member countries, countries such as the Benin Republic imposed a transit duty of an average of N9m per truck on Nigeria-bound cargoes passing through the country by road. To support the trade agreement, AFREXIM put in place the Pan-African Payment & Settlement System (PAPSS) in collaboration with the AfCFTA secretariat to facilitate cross-border payments in local currencies between African markets.

Clearly, the quality of commodities supplied determines what value you get from the commodities market. This is one reason why Nigerian businesses are unable to optimise their income streams from the commodities market. In response to the call for quality and standardisation, director general of the Standards Organisation (SON), Farouk A. Salim, stated the commitment of his agency, in collaboration with other agencies such as NAFDAC and EFCC to support Nigeria’s estimated 40 million Small and Medium Enterprises achieve effective standardisation of their products.

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He also urged the National Assembly to increase penalties on standardisation breaches in subsequent amendments to the SON Act to compel manufacturers and importers to learn to play by the rules.


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