It all began few weeks back in March 2019 with a renewed coverage of the CFTA deal that was proposed in Kigali, Rwanda on March 21st 2018.
As at then 44 African countries ratified and consented to the ACTA (African Continental Free Trade Agreement)
The deal was aimed at unifying trade between African countries, which will entail proposing a borderless and open system of trade between African countries.
The deal is puported to allow free movement of goods and services across borders, which in all hopes - will expand the African market potential leveraging on the populations of comprising countries - and also to encourage Africapitalism.
Now to the interesting part, amongst the participating countries, Nigeria is the only country left to sign the deal as of April, 2019. This has brought a lot of critiquing and pressure from other African countries as to why the deal still hasn't been signed by Nigeria.
IMO(In my honest opinion)
As a citizen, I am stongly of the opinion that Nigeria do not sign the CFTA deal, at least not anytime soon.
Why Nigeria should not sign the CFTA deal
Here are few potential downsides of Nigeria signing CFTA
1. Nigeria is still very much an import based economy. The country has a growing population of 190 million struggling to find its feet on how to build a sustainable economic model. Especially with the growing unemployment rate which is above 23.1% which essentially means 23 out of 100 Nigeria is unemployed.
2. Nigeria's currency rate is higher and more valuable than that of most African countries. Hence a point to look at when considering CFTA. Naturally, the trade landscape will be skewed to have other countries target Nigeria for foreign exchange gains.
3. Open and porous borders; Nigeria can be said to be having a borderless-border, which has been directly linked to the high-rate of insecurity problems along the corridors of border states like Borno state (Boko Haram), Zamfara state(Armed Bandits). Albeit, it is arguable that the CFTA will not in anyway heighten the security and cross border challenges Nigeria is currently experiencing, it still is indeed worth being mentioned.
4. Possible chance of diminishing growth of local content and true economic sustainability as inflow of products from other countries will definitely cause a decline in the badly needed growth of our industrial sectors. Nigeria needs more time on its own to figure out how to have a sytem that will ensure continual stimulation and growth of indeginous local content, which is not in place yet.
5. Possible higher risk of rising unemployment numbers. A CFTA deal opens Nigeria to the risk of having a higher rate of unemployment as existing jobs will also be threatened. With the rise of cheaper goods coming into the country, which citizens ordinarily would have produced locally.
6. Loss of investors and and already operating businesses in Nigeria. Should we go with CFTA, investors and businesses will eventually find it profitable to invest and relocate their businesses to countries with lower labour rates and tax levies, while still targeting Nigeria's market. This will result in Nigerians loosing their jobs to citizens of other countries.Resultant effect are loss of revenues and jobs for Nigeria
The ongoing Brexit quagmire might become a reality for Nigeria should the deal be signed, except if a detailed key trade concession plan in trade can be agreed.
The CFTA for Nigeria can be easily likened for Brexit in Europe. Open trades and borders brings a lot of complexities that will take years of fine tuning if it ever happens, so as not to over burden any one country.