The Federal Government has expressed commitment to boosting local demand for new made-in-Nigeria automobiles by 40 per cent in the next five years, to enhance the benefits of the African Continental Free Trade Agreement (AfCFTA).
Francis Anatogu, Senior Special Assistant to the President on Public Sector matters and Executive Secretary, National Action Committee on AfCFTA, stated this at a virtual interactive session in Lagos.
The interactive session was organised by Coronation Merchant Bank, themed: “Leveraging AfCFTA opportunities – The road ahead”.
He explained that the strategic objectives of Nigeria’s participation in the AfCFTA was to grow local demand for new made-in-Nigeria automobiles to 200,000 units or 40 per cent, over five years.
He said the country would leverage technology and a cluster development strategy to grow the capacity of MSMEs, reduce informal trade and aggregate them for export.
Anatogu said that Nigeria was Africa’s largest market by GDP, accounting for 8.2 per cent of Africa’s goods imports and 25.2 per cent of services import.
He stressed the need for proactive measures to grow local content of made-in-Nigeria products, to satisfy rules of origin, reduce unit cost, create new jobs and attract investments.
Anatogu noted that while intra-Africa trade currently flowed at 15 per cent, the continent was looking at doubling its share of world trade from three per cent to six per cent over the next 10 years.
Having experienced recession twice and devaluation, which impacted its ability to scale up, Nigeria needed AfCFTA to grow its GDP, reserves, exports and make every state grow their local economies, as well as protect their revenues.
According to him, the country’s strategic objective was to capture 10 per cent of Africa’s imports, as well as to double the country’s export revenues by 2035.
“To deepen economic integration of the African continent as well as expand intra-African trade, catalysing the continent’s environment and automotive systems is the key to the implementation of the AfCFTA,” he said.
Also speaking, Komi Tsowou, Economic Affairs Officer, African Trade Policy Centre, Regional Integration and Trade Division, United Nations Economic Commission for Africa, stressed that AfCFTA’s benefits would not be automatic.
Tsowou urged countries to ensure adoption of clear implementation strategies on investment, production, trade facilitation and trade infrastructure to reap the desired benefits.
He said that participating countries must have great a understanding and awareness of trade rules and practices under AfCFTA framework for the private sector.
Tsowou listed top sectors with high potentials within AfCFTA markers as vehicles, transport equipment, energy, metals and machinery, agro-food products and chemical products, among others.
He added that AfCFTA would be a game changer in oil, base oils sector, pointing out that lubricants demand in Africa was expected to rise by about 13 per cent from 2020 to 2025, or from about 1.7 million tonnes to two million tonnes.
Tsowou spoke on the topic: “Building a trade system that is driven by Africans and delivered to the world.”
Earlier, in his address of welcome, the Managing Director of Coronation MB, Mr Banjo Adegbohungbe identified digitisation as key for Nigeria to benefit from the full potentials of AfCFTA.
Adegbohungbe said that organisations needed to adopt a digital economy in order to benefit from AfCFTA, noting that organisations were currently faced with multiple challenges in meeting the specific objectives and opportunities inherent in AfCFTA.
Adegbohungbe said the interactive session was initiated by the bank to stimulate discourse on pertinent economic challenges in the country.