Calls for economic diversification to maximize the benefits of the $2.5 trillion African Continental Free trade Area (AfCFTA) market have intensified. To that end, in a latest move, the Nigeria-South African Chamber of Commerce has pushed for a single passport, free visa regime.
The chamber made the call in Lagos yesterday during its September Breakfast Forum themed: ‘Perspectives on the Africa Continental Free Trade Area in Relation to Nigeria’.
The chamber’s president, Mr. Osayande Giwa-Osagie said AfCFTA would boost intra-African trade by 22 per cent. He also stated that its implementation would impact positively on the Nigerian economy.
He however said Nigeria must diversify its economy in order to harness the gains of the agreement.
“Current intra-African trade rated at 15 to 17 per cent is low and the AfCFTA is expected to boost intra-African trade by 22 per cent.
“Challenges to its implementation are lack of infrastructure, political instability and lack of economic diversification. This gives rise to the need for Nigeria to diversify its economy to harness the gains of the agreement.
“Given the importance of free movement of people, there is a need for a free visa Africa and a single Africa passport.
“While the implementation would help boost the Nigerian economy, impact would be limited if there is no free movement of people,” he said.
Also, head, Trade and Transactional Services, Mr. Jesuseun Fatoyinbo, Stanbic IBTC Bank, said the business community needed more clarification on tariff reduction or elimination under the agreement.
According to him, the little information available to corporate organisations with regards to tariffs, may lead to hold back on investments.
“We have noted increased interests from global multinationals and other corporations in setting up facilities in Africa aimed at serving the continent and exporting abroad.
“So more transparency around tariff reductions both in terms of timelines and details of goods could prompt companies to act,” he said.
Fatoyinbo also called for more attention to the digitisation of trade processes across the continent.
“Currently, trade in Africa is largely reliant on physical documentation and this is a major impediment.
“Policymakers need to prioritize regulatory amendments that allow for the digital signatures, digital certificate of origin, digital bills of lading, and other documentation,” he said.
The chamber’s calls come on the heels of previous calls by the African Development Bank (AfDB) and the African Union (AU).
According to the Africa Visa Openness Index, annually published by the AfDB and the AU, 54 per cent of the continent is now accessible for African visitors who no longer need visas to travel or can get one on arrival. This marks a significant increase of 9 per cent from five years ago.
In addition, 20 countries have moved upwards in the rankings, while 93 per cent of countries have improved or maintained their scores.
The overall picture on visa openness is positive, and reflected in the latest Africa Regional Integration Index, which finds freedom of movement to be the strongest of the continent’s integration dimensions.
Yet, according to the AfDB and AU, as the evolving fallout of the COVID-19 pandemic has shown, countries increasingly need to look beyond domestic frontiers in order to boost their economic prospects.
“Visa openness will support Africa to reposition its future growth and, at the same time, promote participation in regional and global value chains.
“Next year, we hope to see more African countries easing travel restrictions for students, investors, tourists or businesspeople. This, in a significant way, can help lessen the severity of the COVID-19 crisis and make us more connected than before.
“Once restrictions ease, allowing people to move freely across the continent can make a significant impact in reviving key sectors of the economy, from tourism to investment.
“Countries that relaxed visa regimes and adopted visa-free and visa-on-arrival policies have seen economic benefits in recent years, attracting growing numbers of business and leisure travellers. This is the approach recently adopted by small as well as large economies on the continent – from The Gambia to Nigeria – that moved to open up to African visitors,” the index said.
The latest trends show a rapid growth in the use of smart electronic solutions when it comes to travel on the continent, with a 167 per cent increase in eVisas across Africa in the last five years. Going digital and using cutting-edge technology, including biometrics, to speed up and secure entry for visitors will play a key role as countries respond to a changing travel climate.