AfCFTA one year after: Hurldes & milestones for Nigeria

The African Continental Free Trade Area (AfCFTA) marked its one-year anniversary on January 1st, amidst hopes and challenges for Nigeria's agricultural sector. The trade agreement, aimed at fostering intra-Africa trade, has the potential to strengthen Nigeria's position in the region. However, there are hurdles that need to be overcome to fully capitalize on its benefits. Kola Masha, Managing Director of Babangona, shared his insights on the current landscape and the way forward for Nigeria's agricultural value chain. Masha highlighted some key issues that are impeding Nigeria's ability to fully leverage the AfCFTA. One of the critical areas is the existence of export bans on certain agricultural products, limiting the country's market access. Moreover, Nigeria's export processes are inefficient and costly compared to other countries, making it challenging to compete globally. Additionally, there is a missed opportunity in tapping into the landlocked Sahelian countries to the north, which represent a substantial market potential. Despite these challenges, Masha sees immense promise in Nigeria's agricultural sector. With vast land resources, abundant water reserves, and a large workforce, Nigeria has the potential to become a major player in global agricultural trade. However, unlocking this potential requires addressing key issues such as liberalizing the agricultural input space, stimulating private sector investment, and improving access to credit for farmers. The high food inflation rate in Nigeria has been a persistent concern, with logistical challenges across the value chain being a major contributor. Masha acknowledged that progress in addressing these issues is slow but emphasized the importance of catalyzing private sector investment and providing smallholder farmers with access to capital and high-quality inputs. By enhancing farmgate productivity through investments and best practices, Nigeria can improve its food security and mitigate inflationary pressures. Looking ahead, the success of Nigeria's agricultural sector under the AfCFTA will depend on strategic reforms and targeted investments. By removing export barriers, improving logistics, and empowering farmers, Nigeria can position itself as a leading agricultural hub in Africa and beyond. The journey may be long, but with concerted efforts and collaboration, Nigeria has the potential to unlock its agricultural promise and reap the benefits of the AfCFTA.