‘Nigeria, developing countries at risk of deglobalisation’

•Okonjo-Iweala urges business leaders to push for ‘re-globalisation’, trade reforms

Director-General of the World Trade Organisation (WTO), Ngozi Okonjo-Iweala, has reiterated the call for “re-globalisation,” saying deglobalisation poses an enormous risk to developing countries, including Nigeria.

She added that global prosperity would be adversely affected if trade is allowed to fragment into rival blocs.

Speaking at the 13th World Chambers Congress, she told business leaders that the current multilateralism serves global interest , though it needs urgent reform.

Held every two years, the World Chambers Congress brings together participants from around the world to address common challenges that shape the activities of chambers of commerce and businesses.

According to the country’s ex-minister of finance, rising geopolitical tensions, the COVID-19 pandemic, ongoing war in East Europe, climate shocks and the resulting disruptions to trade have spiked concerns about whether the multilateral trading system still works.

“The WTO has made things better for business,” she insisted, citing the Information Technology Agreement eliminating tariffs on almost $3 trillion worth of trade, the Government Procurement Agreement opening up more than $1.7 trillion in yearly public contracts and the Trade Facilitation Agreement that cuts red tape and make it cheaper as well as faster to move goods across borders.

Nevertheless, the WTO’s dispute settlement system still needs fixing to provide the certainty business needs, she noted.

In addition, she said, keeping the WTO fit for purpose for the 21st-century economy requires updating the organisation’s rulebook, particularly, with digital trade, she said.

“The future of trade is services, its digital, it’s green and it has to be inclusive,” Okonjo-Iweala said.

She warned that a decoupling of the world economy into two rival blocs would lower long-run global GDP by over five per cent, with developing and least-developed economies at greater risk.

“We must push back against the pressures for global economic fragmentation, which would be costly and could well weaken supply resilience,” the WTO DG said.

She continued: “A better path forward is what we call ‘re-globalisation,’ deeper, more de-concentrated markets, achieved by bringing more people and places from the margins of the global economy to the mainstream.

“Greater diversification would make it harder to weaponise interdependencies. This holds for critical minerals as well. Many rare minerals are not so rare, but we need technological innovation so that the developing countries where they are found can extract and process them in cleaner ways.”

She urged business leaders to continue speaking up for multilateral cooperation on trade, adding that the “companies and chambers you run are at the centre of making trade work better for people and the planet.”

“We came to have a conversation so that we can open the doors to rekindle the relationship. South Africa is open for business,” he said.

The Director General of ICRC who received the delegation noted that the relationship between both countries on PPPs dates back to the inception of ICRC when members of staff went on a study tour of the South African PPP institutions.

He hinted that from then on, the Commission had recorded great milestones with many PPP projects already underway.

“Over the years, we now have 82 ongoing PPP projects that we are regulating. From 2010 to date the Federal Executive Council (FEC) has approved 102 PPP projects that are worth N10.8 trillion to be invested in by the private sector.

“We have been able to achieve a lot in terms of using PPP to deliver on the infrastructure needs of the country,” he said.

He told the envoy that the Commission had also established a PPP Training Institute called the Nigerian Institute for Infrastructure and PPP (NII3P) where training is offered on PPPs, with an MBA in PPP programme also available in Partnership with the Malaysian University for Science and Technology.

Ohiani notified the High Commissioner that some South African companies were already engaged in PPPs in Nigeria while some others were indicating interest.

“We look forward to having further collaborations especially as it relates to the Africa PPP Network (AP3N) which is scheduled to hold in South Africa later in the year,” he said.