Nigeria has been cautious about the
Economic Partnership Agreement. That’s the agreement waiting to be
ratified by ECOWAS member states and the European Union, West Africa’s
largest trading partner. If any Nigerian hadn’t heard of the EPA before
January 2014,
the Minister of Trade and Investment, Dr Olusegun Aganga,
had since popularised it. The minister had taken time to study the
document and informed Nigerians that some of the provisions were not in
the nation’s interest. That time, the matter made this writer seek the
views of a senior member of the EU delegation to Nigeria. The EU
delegation in Abuja is responsible for ECOWAS issues, it’s been part of
the EPA negotiations over the past 10 years. In the course of an
informal chat with Massimo De Luca, the EU’s Counsellor – Head of Trade
and Economics Section, in Abuja in 2014, (he has since moved to the EU
office in South Africa), this writer drew attention to many of the
reservations Nigeria and other ECOWAS member states expressed about the
EPA. The views expressed by De Luca (with excerpts here) were not only
enlightening, they shed light on the need for nations in the ECOWAS
sub-region to operate more as a bloc. Incidentally, he focused more on
Nigeria which he considered central if the West African sub-region must
enjoy better times in contemporary global economic and trade
arrangements.
On what is in the EPA for West Africa’s
signatories, De Luca pointed to how and why the EU began as the EEC, as
well as how the same drive has spurred the EU to encourage other
countries to operate under a regional arrangement. In the case of West
Africa, issues domestic and external make regionalism imperative.
There’s the need for a larger market that is for the benefit of
especially the smaller nations in the region. There’s the angle of
security and peace which are better assured if West Africa is
integrated. Negotiations leading to the latest EPA are rather economic
and technical in nature, although decisions of nations on its provisions
tend to be influenced by political considerations in the end. In
looking at what signatories stand to gain therefore, the things to check
are if ECOWAS has a common vision, how much of the vision is accepted
by member states, as well as how EPA can help foster the vision. The EU,
De Luca says, intends to use the EPA to assist ECOWAS in achieving
members’ desire for a big market and also their ambition to have peace
and security in the sub-region. This may not be clear to citizens of
West Africa, but forming a regional market is essentially about having a
big market. It’s an economic consideration that has the effect of
promoting peace “on the assumption that when you allow business to work
effectively, then it would be more difficult to go into war”, the EU
Counsellor stated.
An official who displayed a good grasp of
his working environment, De Luca feels there are reasons to wonder how
strong Nigeria’s interest in the bigger regional vision is. This concern
is important because Nigeria is fifty percent of West Africa on most
indices. He is of the opinion that Nigeria sees itself as the ‘big
brother’ in the region but not necessarily as part of a bigger entity.
Rather, the priority for Nigeria has been more on how to harness its
challenges, and to move on based on its internal strength. That means
“the regional integration process is not very topical in Nigeria as far
as I understand”, he said. He pointed out that this is unlike Germany
for which EU is essential because EU is the biggest market for German
products. “Now Nigeria should be the Germany of the region but they
(politicians especially) don’t have the mentality. If you look at the
kind of trade between Nigeria and the rest of the region, it’s still
minimal. Nigeria still deals and trade much more with Europe, China
India and US than any part of the ECOWAS region. So in that way, you can
question where the appetite to have something regional is.”
No doubt, the appetite will be that it
makes sense to have a regional market. It does make sense but it’s not
yet a reality. Market players have not established a network of business
which would demand greater integration. But De Luca believes the
dimension of regional trade is growing partially in the service sector
and into the banks. “We have the regional banks. So I think the market
is really growing but politically, and this is in the minds of the
politicians, I don’t think so. I don’t think politicians are already
thinking regionally. How many times has regional integration policy been
discussed by the Economic Management Team in Nigeria?” Of course, for
smaller countries such as “Benin and Togo, they need the regional market
because without the regional market, they don’t have a market. The
challenge for Nigeria is to open up its market, and say yes, we are big,
we can be much bigger”.
He doesn’t believe in the conspiracy
theory that it is “Europe pushing in a certain direction”, using the EPA
to achieve its aims while he thinks the reluctance on the part of
Nigeria concerning the agreement is linked to its lack of economic
diversification. As long as there is no real economic diversification in
Nigeria, “the appetite for regional market is going to be very
lukewarm”. Nigeria cannot live off oil forever; without diversification
the nation will face huge challenges. The EPA, he pointed out, is
precisely about diversification. “It’s about moving away from a
situation where you trade only in raw commodities like oil”. Even if it
is other products, Nigeria cannot do things in its own way if it is
going to make it “at the level which is global because manufacturers
want to know you comply with international regulations”. According to
him, there is the “need to have machines which are internationally
accepted, practices which are internationally accepted. You need to
produce final products which are internationally accepted. It’s a bit
black and white; it’s either you are part of the global trade or you are
not. There is no such a thing today of a prosperous Nigerian market
which believes it can live with its own rules or without rules…It leads
to nowhere; it leads to poverty…You will need to be able to export your
finished products to other countries and these countries will accept
them only if they are of sufficient quality. Nigeria cannot continue to
think it’s big enough not to care about what’s around”.
Nevertheless, for De Luca, “there are
many good things happening in Nigeria…There are already standard
manufacturers in Nigeria. They produce at a global level. We also have a
minister (Dr Olusegun Aganga) who really for the first time has brought
the problems to the fore”. That is, if Nigeria wants to industrialise,
full sectoral revolution is needed. However, he thinks Aganga still
faces a lot of opposition from those who have always benefitted from the
current situation, and who don’t see the reason the country should go
global. “It’s because these people don’t want any idea of integrating
the Nigerian economy into the global market”, and this is because such
will require commitment even in terms of trade agreements at the
regional level. Making that commitment means a point has to be reached
where things move freely across West Africa, and internally that means
there has to be a change of fiscal system. “No more customs duty but
income tax. It’s a complete revolution”.
This writer specifically asked what De
Luca thinks is the reason Nigeria doesn’t seem convinced about the
contents of the EPA document as it stands. For him, when Aganga got into
office, being a smart and capable minister with a solid career
background, he took note that in over 10 years of negotiation, a
Nigerian position on the EPA had not been on the table. He also found a
few things that Nigerian officials who had handled the EPA before him
did not pay particular attention to, so he raised issues about them.
This explains the exception the nation took to the EPA so late in the
day, he explained.
To be continued
Our leaders. Kill the great dream ot this nation, what a pity Africa
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