Vice-President Yemi Osinbajo has called on African Union (AU) member states to ratify and implement protocols on free movement of persons, right of residence and right of establishment.
These are under the Africa Continental Free Trade Area (AfCFTA).
The Vice-President made the call in a statement signed by Mrs Omotayo Okewunmi, Public Relations Officer, Manufacturers Association of Nigeria (MAN) on Friday in Lagos.
The Vice-President’s remarks were to commemorate the [email protected] roundtable on industrialisation in Africa with the theme: “Positioning African Countries for Economic Transformation and Continental Free Trade.”
Osinbajo said that addressing the protocol on free movement, including the right of establishment would create the necessary framework for businesses to widen their operations across the sub-region and thereby deepen regional value chains.
He stressed the need for African governments to provide a stable macroeconomic environment that avoids and smoothens out volatility in prices, sharp deteriorations in the current account and budget deficits, and rapid accumulation in debt burdens.
Osinbajo also noted the importance of well-negotiated rules of origin in the context of the free trade agreement, which he said was key to preventing trans-shipment and the deflection of trade.
“So, the crux of my message today is that we must take policy actions to create an environment in which businesses can thrive.
“To start with, we must adopt the right type of macroeconomic and industrial policies.
“On the industrial side, policies like tariffs, quotas, subsidies, and non-tariff barriers which protect our infant industries so that they can create jobs and enable learning are vital.
“I think it is important for MAN to involve itself in an advisory capacity to government negotiators as we go further into the rules of origin negotiations. We should get more contributions and advise from MAN,” he said.
The vice president also noted that the need to develop a strong infrastructural base to facilitate the movement of goods and people.
He said this was as the continent build the electricity plants to power factories and the broadband networks that lubricate modern business.
Another requirement, he said, was to deepen the ecosystem for domestic and regional value chains.
“In such an ecosystem, incentives will be coordinated and tied to performance, development banking institutions will be geared to supporting manufacturing activity.
“This is as investment and intellectual property regimes are harmonised, aligned and consistent with Africa’s realities and industrial policy objectives.
“There would also be sharing of research and development outcomes across regions and even supply chains that interlink Special Economic Zones.
“Another major objective must be to ease payments across borders as it is quite essential to develop and deepen inter-regional and continental payments systems.
“It is particularly important in this regard to rapidly operationalise the effort by Afreximbank to establish a Pan-African Payments and Settlement Platform.
“This will go a long way in creating the desired continental payments system and also in facilitating cross-border informal trade which is estimated to be about $93 billion per annum,” he said.
Osinbajo charged manufacturers to become competitive after clearly specified time periods so that they can withstand the ever-present danger of stiff competition from imports.
“When the gap in prices between domestically produced goods and imports is too high, arbitrage opportunities become irresistible and Customs Services will struggle to reduce trans-shipments and stem smuggling.
“In other words, while our manufacturing industries must be nurtured and supported, they cannot remain infants forever,” he said.