Remove Trade Barriers In Africa
The issue of barriers to trade in sub- Saharan Africa resonated recently when the Executive Secretary of Nigerian Shippers’ Council (NSC), Barrister Hassan Bello, called for the removal of physical trade barriers in the African sub-region. Before now, serious efforts have been made to improve trade within the sub region. Limited success has been recorded because regional transportation that requires integration, harmonisation and standardisation has not attained the desired level of efficiency. Experts acknowledge that natural barriers can also slow down trade between nations by making it harder and more expensive to move goods from place to place.
In Africa, specifically, this has affected the volume of trade which is not very much. The volume of trade within the Central African region represent about one per cent when compared with that of Europe which stands at 70 per cent. This makes it imperative that ways of improving trade within the sub-region must be worked out as there are so many things to trade on among African countries.
Presently, Nigeria’s trade is supported by Economic Community of West African States’ (ECOWAS), laws and protocols which have been guiding effective relations in that zone. The Shippers’ Council, as an agency, has been playing a critical role in ensuring that the institutions and bodies involved are supported in one way or the other.
However, it is pertinent to note that trade policies are becoming regionalised even as there is significant variation in terms of the pace of integration and harmonisation across the continent, as well as the extent to which non-state actors are incorporated into these processes.
Formal barriers at the borders may not necessarily be the most important impediment to trade in sub-Saharan Africa. Better infrastructure and trade – related services can facilitate the spatial integration of product and factor markets in all sectors.
In particular, understanding the political economy of agricultural trade policy helps explain some of the dynamics contributing to the persistence of barriers. This includes the non-implementation of regional agreements, a lack of credible commitment between the government and private sector actors, the disproportionately strong role of anti-reform lobby groups and the difficulties of farmers to engage in collective action, among others.
World Bank in a 2012 report noted that policy-makers and donors have an opportunity to engage in a number of ways to make trade agreements more effective and credible, address information asymmetries and issues of trust within markets and improve data collection and dissemination efforts. It maintained that effective regional integration is more than simply removing tariffs—it is about addressing on-the-ground constraints that paralyse the daily operations of ordinary producers and traders and added that this calls for regulatory reform and, equally important, for capacity building among the institutions that are charged with enforcing the regulations.
The world body posited that integration agenda must cover services as well as goods. Because services are critical, job-creating inputs into the competitive edge of almost all other activities. A good example is the role that transport plays in trade and manufacturing.
It counselled that regional communities can provide the framework for reform by bringing together regulators like Nigerian Shippers’ Council to define harmonised standards or to agree on mutual recognition of the qualification of professionals just as responsibility for implementation lies with each member country.
In our view, there is no gain saying it that improving cross-border trade by simplifying procedures, limiting the number of agencies at the border and increasing the professionalism of officials, supporting trade associations, improving the flow of information on market opportunities, and assisting in the spread of new technologies such as cross-border mobile banking that improves access to finance; removing a range of non-tariff barriers to trade, such as restrictive rules of origin, import and export bans, and onerous and costly import and export licensing procedures; as well as reforming regulations and immigration rules that limit the substantial potential for cross-border trade and investment will go a long way in this regard.