Manufacturers, SMEs urged to embrace ETLS to combat capital flight
Local manufacturers and owners of micro-small and medium enterprises (MSMEs) operating in Lagos and other parts of the Southwest region have been urged to explore the potential of the Economic Community of West African States (ECOWAS) Trade Liberalisation Scheme (ETLS).
Touting ETLS as a key tool to access new markets and generate foreign exchange for manufacturers, participants at the one-day sensitisation workshop were taught how they could leverage the ETLS platform to export and market their products to other ECOWAS countries.
The workshop, organised by the ECOWAS national unit of the Ministry of Foreign Affairs in partnership with the Export Group of the Lagos Chamber of Commerce and Industry (LCCI), brought together big and small manufacturers across the Southwest, as well as representatives from government agencies.
LCCI President, Dr. Michael Olawale Cole, said the conference, themed, ‘Sensitisation Engagement on Unhindered Market Access the ECOWAS Trade Liberalisation Scheme (ETLS) Offers’, aimed at enlightening and helping stakeholders on the administration, benefits, and ways to navigate ETLS challenges. He added that while the global economy declined sharply due to high inflation, trade limitation due to border closure, monetary tightening, and other factors, the economies of member countries were not exempted from these unwelcomed shocks, with the agricultural sector slowly becoming immune to global distortions, while manufacturing and services sectors are being severely impacted by the twin effects of global inflationary pressure and exchange rate shock.
Speaking on the scheme’s benefits, he said asides from exemption from import duties and taxes as well as promoting sustainable development and poverty reduction, the ECOWAS trade strategy aims to facilitate the sub-regional integration into the global economy while considering the political choices and development objectives of member-nations.
However, he noted that despite policy efforts targeted at integrating the sub-region, challenges to regional economic integration within ECOWAS persists, including over-reliance on money from import taxes by some West African nation, which he said is a threat to the integration arrangement. ECOWAS, he said, remains at the lower rung of integrated sub-region in Africa in terms of macroeconomics, trade, infrastructure, and productive integration.
He urged the government not to limit private sector participation to sensitisation phase alone where the request to drive reforms are minimal, but the active participation of the organised private sector (OPS) should be strengthened by engaging LCCI and others at the policy formulation stage.
Consensus reached at this stage will require less sensitisation because it is all-inclusive and represents the submission or position of all stakeholders without prejudice to government intentions on the policy.
Minister of State for Foreign Affairs, Zubairu Dada, on his part, said the workshop would help to appraise indigenous companies on the administration and benefits of a Free Trade Area as the last sensitisation workshop was held in 2019.
Adding that the workshop was informed by the need to create awareness for the scheme to ensure that companies fully maximise its opportunities, he said it would also deepen ECOWAS sub-regional integration and encourage intra-regional trade.
Adding that African Continental Free Trade Area (AfCFTA) is another stride in Africa’s regional integration history and is expected to generate significant gains, Dada said AfCFTA does not invalidate the ETLS, instead, AfCFTA would open countries to the potential of economic development and both will exist concurrently.
At a technical session held to provide further input on ETLS and the roles of different relevant agencies, the Ambassador/Permanent Representative of Nigeria to ECOWAS, Sani Musa Nuhu regretted that the country wasn’t doing as well as it could, in terms of trade and export.
Head of ECOWAS National Unit, Nigeria, Yakubu Dadu, urged manufacturers not to pay anyone for ETLS inspection, stressing that it was completely free to apply. Adding that the benefits far outweigh the challenges, he said improved export will encourage entrepreneurial development in the country but manufacturers have to adhere to the approval criteria and procedure.
Ayodele Sunday, representing the Nigerian Export Promotion Council (NEPC), said the scheme presents immense benefits to local players including job creation due to a larger market, poverty alleviation, removal of import duty, no quantitative restrictions, promotion of economic development, globalisation advantage, harmonisation of standards and lower production costs.
On challenges it presents, he listed some to include different products standard by different ECOWAS countries, multiple charges and police checkpoints, countries that could easily become dumping grounds if not well implemented, a limited sub-regional market, absence/poor application of market-driven strategy, poor implementation of the protocol on the free movement of residences, poor sensitisation, overdependence on natural resources, mono-cultural economies, infrastructure challenges, high volume of informal trade, fear of domination from poorer countries and non-reciprocity of standards.
Proffering recommendations, he said proper manning of posts is needed as well as the total dismantling of multiple checkpoints; removal of informal/illegal charges, a need for a common standard for made-in-ECOWAS products; tailored incentives to encourage mainstreaming of informal trade, Free Trade Zone (FTZ) companies should be allowed to participate in the scheme through the review of article 7 of the ECOWAS protocol and the country’s fiscal policies must align with regional commitments.
Superintendent of Customs, ETLS Desk Officer (Trade Facilitation/Preferential Trade/ROO Unit Tariff and Trade Department), Nigeria Customs Service, Dimka Mary Simi, spoke on measures the body was taking to improve and ease exports outside the country for manufacturers
Desk Officer, International Trade Office (Office of Trade and International Relations), NAFDAC, Haleemat Gbonjubola Kadiri, speaking on NAFDAC’s role in promoting the scheme, said nothing can be exported outside the country, except they have been NAFDAC certified. “All products must have marketing authorization, which is the NAFDAC number granted after several steps have been taken. Challenges faced by exporters include rejection, poor packaging/labelling and inadequate knowledge about the specifications required by the importing country among others but we have put some strategies in place to curb these challenges,” she said.
The Assistant Director, of National Enquiry Point on Technical Barrier to Trade (Standards Development Directorate) SON, Chioma Chudi-Anaukwu said the body is working on improving product quality by-product certification, lab testing, capacity building, enforcing standardisation among others.
Stressing that importers must have Mandatory Conformity Assessment Programme (MANCAP) and
Standard Organisation of Nigeria Conformity Assessment Programme (SONCAP) certifications, she urged manufacturers to stop boycotting protocols.