ABUJA, June 19 (Reuters) - Nigeria will consider the
interests of its industries in deciding whether to sign up to a
$3 trillion Africa free-trade agreement, President Muhammadu
Buhari said in a meeting with local manufacturers on Wednesday.
The African Continental Free Trade Agreement
(AfCFTA)encompasses 1.2 billion people. Fifty-two of the 55
countries that make up the African Union (AU) have now signed.
Aside from Nigeria, only Benin and Eritrea have opted not to
sign up to the agreement.
Buhari has so far refused to join the trade zone, which came
into force last month and is meant to eliminate most tariffs to
create a single market with free movement of goods and
services. He fears that by joining the zone other countries would dump
cheap goods in the huge market in Africa's most populous country
- a nation of some 190 million people - and therefore undercut
efforts to stimulate the manufacturing sector, which is
currently limited.
Nigeria's dependence on imports puts a strain on the
country's finances and foreign reserves. It relies on oil
exports for around 90 percent of U.S. dollar earnings.
Buhari told leaders of the Manufacturers Association of
Nigeria trade body on Wednesday that he was awaiting the
findings of a committee set up in October to assess the
potential cost and impact if Nigeria signed up to the agreement.
"Nigeria will be guided by national interest in taking any
decision on the agreement establishing the African Continental
Free Trade Area," Buhari said in a statement. He did not say
when a decision would be taken.
Buhari, who last month began a second four-year term at the
helm of Africa's biggest economy, has touted local consumption
and boosting non-oil exports as a key policy. But results are
yet to materialise.
He told the manufacturing leaders that the trade zone would
be discussed at the AU summit to be held in neighbouring Niger
in July.
"I don't think Nigeria has the capacity to effectively
supervise and to ensure that our colleagues in AU don't allow
their countries to be used to dump goods on us to the detriment
of our young industries and our capacity to utilise foreign
exchange for imported goods," he said.
Intra-regional trade sits at around 15 percent of Africa's
total commerce. Economists have pointed to this low level as one
of the reasons for the continent's enduring poverty and lack of
a strong manufacturing base.