Understanding The Benefits Of Trade Agreement

In most cases, bureaucratic delays, inadequate capacity enhancement of customs formations, poor transportation infrastructures, smuggling and insecurity, among others, pose serious challenges in moving goods across borders for African traders.
Observers note that the situation becomes worse with porous borders and lack of automations of most customs administrations in Africa.
According to them, these challenges have impeded the ease of doing business for most African countries, especially in Nigeria.
They also observe that those traders from developing and developed countries often experience various challenges in moving goods across the African borders.
They believe that this development has directly affected the revenue driving capacity of most customs commands in Africa, resulting in economic crisis in Africa.
To address this, the World Trade Organisation (WTO) enacted the Trade Facilitation Agreement (TFA) that came into force on February 22, following its ratification by two third members of the WTO.
The TFA contains provisions for expediting the movement, release and clearance of goods, including goods in transit.
It also sets out measures for effective cooperation between customs and other appropriate authorities on trade facilitation and customs compliance issues, including technical assistance and capacity building in customs administration.
The need to transfer the gains of TFA to African region, therefore, necessitated the inaugural meeting of the African Union (AU) Sub-Committee of Directors-General of Customs in Abuja between May 23 and May 25.
“With the theme: “Entering into Force of the World Trade Organisation Trade Facilitation Agreement: Implication for African Customs Administrations,’’, the meeting was attended by 50 African heads of customs.
The meeting was designed to form alliances on best mechanism to address the challenges inherent in trans-border trade in Africa and to brainstorm on how customs administrations in the continent can form coalition to harness the continent’s trade potential for economic growth of the region.
On January 20, Nigeria provided the document of acceptance to the World Trade Organisation’s Protocol on TFA at World Economic Forum in Davos, Switzerland.
The provision of the document of acceptance by Nigerian government made it the 107th WTO country that ratified the TFA.
Other African countries that have also ratified the TFA: include Botswana, Niger, Togo, Côte d’Ivoire, Kenya, Zambia, Lesotho, Mali, Senegal, Swaziland, Gabon, Ghana and Mozambique.
Mrs Treasure Naphanga, the AU representative at the event advised the directors-general of African customs to provide the required leadership for the ratification of the TFA by countries in the region.
She said it was worrisome that since the emergence of the TFA, only 20 out of the 54 African countries had ratified the agreement.
She noted that it was important for African nations to ratify the agreement, given the numerous benefits accrued to the region.
She also said that the ratification and correct implementation of the TFA would serve as an important platform to improve revenue collection, improve border security and better utilisation of government resources by border agencies in the region.
She observed further that the expensive nature of doing business in Africa such as non-access to roads and the uncoordinated nature of some African ports, among other challenges, informed the call for the ratification.
She said the AU had undertaken various studies on the implementation of the WTO’s trade facilitation agreement in Africa.
According to her, the commission is putting modalities in place to assist and facilitate the implementation of category A, B and C of the agreement to widen African markets.
Given the vantage position of Nigerian Customs Service in driving inter-regional trade in Africa, the Minister of Finance, Mrs Kemi Adeosun, urged the directors-general of customs to facilitate movement of goods across borders.
She said it was important to understand that customs’ activities at the borders could make or mar the economy of any nation.
“I understand that directors-general of customs will be discussing issues of mutual cooperation among customs administrations to forge a common position for mere relevance in governance of World Customs Orgainisation.
“I assure you that Nigeria, under the leadership of President Muhammadu Buhari, is always willing and ready to support any decision that can impact positively on the economic and security fortunes of the nation and that of the AU member states.
“It is, therefore, a challenge to you to always employ interventions that will expedite the movement of trade goods across border in a simplified  and predictable manner to enhance trade facilitation and promote economic growth on African continent,’’ Adeosun said.
She said that Africans were eager to see the quick establishment of continental free trade area that would encourage intra-African, promote capacity utilisation of African products and improve the economic status of citizens.
However, analysts are worried on the ability of some African countries to fully implement the TFA, given the challenge of insecurity and lack of capacity of most customs formations in the continent.
The Comptroller-General of Nigeria Customs Service, Col. Hameed Ali, said the service would key into national single window system before the end of 2017 to enhance capacity building.
He also said the service had been undergoing restructuring with customs automation reaching 75 per cent completion.
“Before the year ends, we will key to the national single window system. We are in the process of actualising our staff college, in the next three months; we will be commissioning our college in terms of training our officers.
“We have enhanced our enforcement capacity from three levels to four and we realise that smuggling is one of the banes of our job.
“So, we need to enforce, which made us to create the fourth layer; this has helped to reduce smuggling to the barest minimum,’’ he said.
He said the Nigeria Customs Service was on the verge of obtaining scanners to inspect goods in the ports and airports to reduce the time used for inspection.
“Similarly, the service had proposed a meeting on trade facilitation involving Cameroon, Niger, Chad, Benin Republic, Togo and Central African Republic to create a security corridor to enhance facilitation of trade.
Ali said the meeting was a platform that brought the African continent together to form a formidable front for customs administrations to pursue African agenda in the global trade, economic development and security.
Sharing similar sentiments, the Chairman, Sub-Committee of Directors-General of African Customs, Mr Happias Kuzvinzwa, said it was important to develop the capacity of African customs administrations to implement TFA on the continent.
He, however, observed that enormous resources were required to improve the capacity of officials in the various customs formations in the region.
He said that there were recommended and adopted best practices that the customs administrations could use to implement the agreement in the region.
According to him, development and enhancement of capacity is mandatory in the area of automation of transit trade and automation of electronic cargo checking.
Kuzvinzwa solicited the collaborative effort of all security agencies by sharing of intelligence information among the security officials in the region to mitigate insecurity.
Given the enormous challenges of intra-border trade in Africa, analysts expect that Nigeria will evolve a common front and a cohesive continental work plan aimed at implementing the provisions of TFA and getting a uniform agenda for economic growth of the country.
Okoye and Tolofari write for News Agency of Nigeria (NAN).

Kingsley Okoye and Suzzy Tolofari