In a major step towards regional trade integration, Nigeria has officially signed and transmitted the ECOWAS Schedule of Tariff Offers for Trade in Goods under the African Continental Free Trade Area (AfCFTA). The development, which was officially gazetted and submitted to the AfCFTA Secretariat, marks a significant milestone for Nigeria as it advances the implementation of the AfCFTA, a continental trade agreement aimed at boosting intra-African trade and creating a single market for goods and services.
This announcement, made ahead of the 16th meeting of the AfCFTA Council of Ministers in Kinshasa, Democratic Republic of Congo, on April 15, is expected to have a profound impact on Nigeria’s trade relations and its role as a trade hub in Africa. The ECOWAS Tariff Offer will establish zero duties on 90% of tariff lines for trade in goods, which is a game-changer for Nigerian businesses seeking to expand their footprint in the African market.
The ECOWAS Tariff Offer, signed by President Bola Ahmed Tinubu, represents a significant shift towards increased market competitiveness for Nigeria. By slashing tariffs on goods traded within the region, Nigeria’s products are now positioned more competitively across Africa. This move enhances business access, profitability, and overall market share for Nigerian manufacturers and exporters.
Dr. Jumoke Oduwole MFR, the Honourable Minister of Industry, Trade, and Investment, emphasized the importance of this milestone. She explained that the gazetting and transmission of the ECOWAS Schedule of Tariffs signals Nigeria’s readiness to engage fully with the AfCFTA framework. “This milestone enables Nigerian exporters to leverage preferential tariff access across African markets, positioning Nigeria as a key player in regional and global trade, and underscores Nigeria’s dedication to leveraging Africa’s single market for economic transformation,” she said.
The ECOWAS Tariff Offer strengthens Nigeria’s role in shaping the future of intra-African trade by reducing barriers to market access. It provides businesses and manufacturers with expanded opportunities to tap into new markets, enhancing Nigeria’s competitiveness in the global economy. Additionally, the implementation of zero tariffs on most traded goods offers potential for increased exports and job creation as businesses expand.
This move has significant economic implications for Nigeria. By eliminating or reducing trade barriers with other African nations, the country is fostering greater economic integration with its neighbors and trading partners. As Nigerian goods become more accessible to other African countries, local businesses can tap into a wider customer base, boosting their profitability and expanding their market presence.
Small and medium-sized enterprises (SMEs) stand to benefit greatly from this initiative. The lower trade costs, reduced tariffs, and improved market access will give these businesses the opportunity to scale, increase exports, and contribute to Nigeria’s overall economic growth. This will, in turn, lead to the creation of jobs and the stimulation of local industries that are key to economic development.
The commitment to the AfCFTA will also enhance Nigeria’s attractiveness as a destination for both foreign and intra-African investment. With a more competitive market and reduced trade barriers, investors will be more inclined to set up businesses in Nigeria, contributing to its growth as a major economic player on the continent.
However, experts have cautioned that while this is a positive step forward, stronger engagement from African trade ministers is necessary to address non-tariff barriers that could impede market access. These barriers include bureaucratic inefficiencies, regulatory inconsistencies, and logistical challenges that could undermine the full benefits of the AfCFTA. Nigeria must also continue to improve its productive capacity and ensure that its products comply with international standards in order to maximize the advantages of the agreement.
Nigeria’s role in the AfCFTA is becoming increasingly vital. The country has already taken significant steps in implementing the trade agreement, including initiating its first shipment under AfCFTA in July 2024. With the formal gazetting of the ECOWAS Tariff Offer, Nigeria has solidified its leadership in regional trade and integration.
The tariff reductions follow a phased approach that will continue until 2031. By 2025, Nigeria plans to reduce tariffs by 50% for trade with least developed countries within the continent. Meanwhile, for trade with developing countries, Nigeria will implement complete tariff elimination (0%) immediately, with annual reductions of 20%.
This phased approach is designed to ensure that Nigeria can gradually integrate into the AfCFTA framework while allowing time for local industries to adjust to increased competition and market demands. It will also help minimize disruptions to the domestic economy, providing time for businesses to scale and adapt to new market dynamics.
In addition to the tariff offer, Nigeria has also made strides in advancing digital trade across the continent. In February 2024, during the African Union Summit in Addis Ababa, President Bola Ahmed Tinubu received personal commendation for his work on digital trade. As the co-champion for digital trade under the AfCFTA, Nigeria is playing a critical role in ensuring that businesses—especially SMEs—can fully benefit from seamless trade facilitation and cross-border commerce.
Digital trade is essential for improving trade efficiency, reducing costs, and enhancing transparency in cross-border transactions. By championing digital trade initiatives, Nigeria is helping create a more connected and efficient trade environment in Africa, ensuring that the benefits of AfCFTA extend beyond traditional goods trade to include digital services and e-commerce.
As Nigeria continues to push forward with AfCFTA implementation, it is essential that the government continues to work on resolving challenges related to non-tariff barriers, infrastructure gaps, and regulatory hurdles. Moreover, it must continue to foster strong relationships with African nations to ensure the smooth implementation of the AfCFTA framework.
In the coming years, the full benefits of the AfCFTA will depend on how well Nigeria and its partners address these challenges while fostering an environment of cooperation, innovation, and market access. The country’s leadership in regional trade integration, digital trade, and economic growth will be crucial to the success of AfCFTA, and Nigeria’s actions in the coming months and years will help determine the future of African trade.
