Nigeria will lose $1.3trn to ECOWAS-EU Economic Partnership Agreement – MAN

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(Last Updated On: 2016-09-21)

Abolaji Adebayo
The Manufacturers Association of Nigeria, MAN, has declared that Nigeria stands to lose about $1.3 trillion if it signs the Economic Partnership Agreement between Economic Community of West African States (ECOWAS) and European Union, saying the EPA would have serious negative effect on the industrial development of the country and compound the current socio-economic crisis faced by the country.
In a statement signed by its President, Dr. Frank Jacobs, yesterday, the Association warned the country to desist from the agreement but rather face its current economic crisis and find a way to pull out of its economic recession.
It would be recalled that since it was endorsed in July 2014 by the Committee of Heads of State and Governments of ECOWAS, key stakeholders in the Nigerian economy including the Manufacturers Association of Nigeria, MAN, Lagos Chamber of Commerce and Industry, LCCI, Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture, NACCIMA, have persistently opposed the signing of the EPA by Nigeria due to the conceived negative effects it would have on the socio-economy of the country.
The Minister of State for Industry, Trade and Investment, Aisha Abubakar, had once said that the delay in signing of Economic Partner Agreement, EPA, by Nigeria is not an attempt to undermine the efforts of the ECOWAS commission as well as the EU on the already concluded EPA, but rather based on the need to address the economic challenges Nigeria is presently facing.
Speaking  during a one-day sensitization seminar on EPA organized by the European Union, EU, and the Economic Community of West African States, ECOWAS, held at the Grand Central Hotel, She said “Nigeria and Gambia withheld their signatories to the agreement due to some identified issues of national importance that needed to be addressed.”
According to the minister “We need some time to consult further with the relevant stakeholders and agree on the next step, while our gathering today is a step forward towards finalizing on Nigeria’s position,” adding that trade agreement is too critical to be concluded and signed in a hurry.
“It became imperative that we reflect deeply on the trade liberalization deal with the EU and its long-term impact on the continents efforts towards industrialization and job creation,” pointing out that, “we need to leverage our abundant natural resources and large market to develop our industries.”
In June this year, Vice President Yemi Osinbajo said at the Dakar meeting of West African leaders that Nigeria would continue consultations within the country regarding its stance on the Economic Partnership Agreement, EPA, between ECOWAS and the European Union.
According to him, “there are ongoing negotiations on it. We are discussing with the Manufacturing Association of Nigeria, MAN, and some other key economic players about it.”
In addition, the VP noted that “we understand some of the terms of this agreement are capable of restricting their-manufacturers-trading activities and we would not want this to happen.”
Prof. Osinbajo explained that in the consultation process “it is equally important that as we make the decision, we take into consideration the concerns of these critical stakeholders and tread cautiously.”
He noted at the meeting that Nigeria was yet to fully endorse the agreement because of these concerns.
He disclosed that for now the federal government would continue to engage in wide consultations with relevant stakeholders before coming to a conclusion on the Economic Partnership Agreement.
While a number of West African nations have endorsed the deal, a few including Nigeria have raised issues regarding the implications of the deal, being championed by the European Union.
The EPA is a free trade deal that had been initiated by EU and ECOWAS negotiators covering trade in goods and development cooperation.
Meanwhile, the Vice President also restated Nigeria’s constant commitment and obligations to the regional body having recently paid its dues. This is coming against the background of worries that some of the members of the body are not up-to-date in their financial obligations, with a call raised at the Dakar summit for such nations to do so.
Indeed Nigeria was openly commended at the summit for fulfilling its obligations by paying the community levies.
“We are also very committed to ECOWAS. As the largest economy in the region, we have constantly fulfilled our obligations and we intend to continue to do this,” the Vice President declared.
Meanwhile, MAN stated that the country needed to pull out of its current recession and do away with the EPA, which cannot benefit its economy in anyway.  It noted that Nigeria is mainly a commodity-goods producing country and would trade same in EPA free trade arrangement, adding that the country has limited capacity to produce and export industrial goods to Europe.
Analysing the implications of the agreement on Nigeria’s economy, MAN stated that EPA would stifle existing manufacturing companies as they would be uncompetitive because cheaper finished goods from European countries would flood Nigerian markets. This, according to the Association, would lead to the de-industrialisation, which could have catastrophic implication on employment generation and poverty alleviation in the country. It added that there would be loss of investments.
As stated in the Statement, Jacobs noted that the recent policy of resource-based industrialisation, which is adopted by the federal government aimed at utilising the country’s abundant natural resources to produce goods that the country needs and which would ensure a sustainable and enduring industrailisation, would automatically be killed.
He further said that companies, which have already been investing in production of raw materials and intermediate products, would be forced to close down while Nigeria would perpetually continue to be exporter of unprocessed raw materials and importer of processed goods.  It added that this would equally undermine the Nigerian Industrial Revolution Plan, NIRP.
“Current effort by Nigerian manufacturers to export non-oil manufactured products would be greatly hampered. The recent surge in the export of non-oil manufactured products which has grown tremendously would be drastically affected. It would negatively affect the informal sector and the SMEs that are currently sustaining a large percentage of our population.
“Nigeria would incur significant revenue loss through removal of tariff estimated at about $1.3 trillion. The agreement would have implications for Nigeria’s other trading partners such as the US and China especially in the context of the Most Favoured Nation, MFN.
“The truth is, our economy is currently challenged, the situation should not be compounded by Government appending its signature or domesticating EPA. Rather, concerted efforts from all stakeholders should be geared to overcome our current economic challenges. Government should continue to adopt home grown policies and strategies that have the capacity to offer required economic fillip and achieve desired results. MAN assures President Muhammadu Buhari that the Association as always, is open for further engagement and detailed presentation on the view expressed in this release,” he declared.

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