Africa: Protectionism in Africa Could Hinder Free Trade

AFRICAN states are trying to tear down economic barriers through a continent-wide trade pact, but it has emerged citizens are not keen on foreign goods in their shops.

This, in hindsight, shows the African Continental Free Trade Area agreement is not well appreciated at grassroots level.

South Africa reported at the beginning of this week, and Bloomberg recently, that Benin, Nigeria and Ghana are having trouble to ensure effective trade relations – which hampers the agreement.

While 54 of the 55 countries recognised by the African Union have signed the agreement which is expected to eliminate cross-border tariffs on 90% of goods and facilitate the movement of money and people, some 27 members have yet to ratify it.

This includes Nigeria, the continent’s biggest economy.

Bloomberg reported yesterday that hundreds of trucks have been parked at Benin’s border with eastern neighbour Nigeria for more than a year.

This is due to the government in Abuja abruptly curbing imports in a move to throttle the widespread smuggling of products that were sabotaging local industries and fuelling insecurity.

Also, in Ghana’s capital, Accra, Bloomberg said officials have shut Nigerian-owned stores to comply with a law that restricts foreign participation in its retail trade. These hurdles will keep Africa from fulfilling its vision of instituting a continental free-trade agreement unless difficult relationships between countries are corrected.

For now, protectionism remains priority for many African countries – especially those who have been dealt a heavy blow by Covid-19.

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