… African Export-Import Bank boss, Professor Oramah, urges youths to harness African Continental Free Trade Agreement which takes effect by July 1, 2020
By Ndu Chris Nwannah, ATM Guest Writer, and Chudi Okoye
It had taken an immense amount of gritty work to bring it into being. A generation of African statesmen dreaming about it and years of insistent, bareknuckle diplomacy finally produced the African Continental Free Trade Agreement (AfCFTA). To date, 54 of the 55 sovereign states of the African Union (AU) – successor to the fabled OAU (Organization of African Unity) – have signed up and 29 have ratified the protocol, kicking the agreement into effect on 30 May 2019. With this, free regional trading under the agreement is set to start on 1 July 2020 – in just over three months.
With this remarkable milestone, Africa has set up – in terms of numbers of participating countries – the world’s largest free-trade area since the establishment of the World Trade Organization (WTO) in 1994. The AfCFTA protocol covers a market of more than 1.3 billion people, representing about 17% of the world population. It also covers a continental market with a combined current gross domestic product (GDP) of US$3.4 trillion, representing a miniscule 3% of global GDP, but which is predicted to grow to about US$5.6 trillion in 2025, five years hence.
Broadly, the African Continental Free Trade Agreement aims to eradicate tariffs, liberalize trade and create a single market in the continent of Africa. This will mean progressively free movement of people, capital, goods and services across the continent. This presents a massive opportunity for the more competitive African countries, but especially the youths who predominate in the continent’s population. Africa is the youngest continent in the world, with 60% of its population less than 25 years old. Nigeria, as a country, has an exceeding youth proportion, with 62% of its population younger than 25.
With the commencement of the African free trade revolution only three months away, and with many global development organizations from World Bank to One saying that African youths are best positioned to take advantage of the emergent market, it was quite fitting that the commencement speech at the ongoing convocation ceremony of Nnamdi Azikiwe University (UNIZIK), Awka, should centre on the matter of youth sensitization and development.
▲Professor Oramah, UNIZIK Convention Lecturer, 2020
For its 14th convocation ceremony, UNIZIK invited the President and Chairman, Board of Directors, African Export-Import Bank, Professor Benedict Okey Oramah, to deliver the Convocation Lecture. The professor obliged and turned up with an eager message. In a paper titled “Unleashing the Power of the Youth” delivered on March 11th in the institution’s auditorium, Professor Oramah, himself a 59 year-old with a PhD in agricultural economics, charged the graduating youths to make effective use of the African free trade agreement to unleash their untapped potentials. Professor Oramah reminded the audience about AfCFTA kick-off date and the opportunity it presents.
“On July 1, 2020,” he began, “trading under the African Continental Free Trade Agreement (AfCFTA) will commence. The AfCFTA, which is aimed at doubling the share of intra-African trade in Africa’s trade within a 10 year period, is also expected to transform the continent’s manufacturing sector, formalize and strengthen the SME sector and ultimately accelerate economic growth and development.”
The President of Afreximbank said AfCFTA would definitely unleash the abundance of the African youth, as it would break the barriers of 84,000 kilometres of borders over 55 countries. He said that the policy would reduce the about 54 visas needed to travel across Africa, create regional supply chains, foster manufacturing and expand the creative sector of Africa.
“Today, the visas are gradually disappearing. The AfCFTA will create regional supply chains, foster manufacturing and expand the creative sector of Africa. It is the AfCFTA that will unleash the creative and innovative power of the African youth. The struggle for economic emancipation cannot be easier for the African youth.”
He said that “the emergence of light manufactures, regional and continental supply chains and a strong creative industry will depend on how the youth is able to harness the opportunities offered by the AfCFTA.”
Professor Oramah argued that in historical and contemporary history youths have been the catalyst to economic transformation. He cited the instance of ‘Asian Miracle’, arguing that youths were instrumental in uplifting South East Asian economies from poverty to prosperity during the 1970s to the 1990s. The professor cited youths as Africa’s greatest resource, much more valuable than oil and solid minerals, and argued that in the face of high youth employment, rising crime rates and dangerous emigration practices, there is imminent need to channel youthful energy to useful engagements.
Professor Oramah charged youths to be prepared to take full advantage of any emerging opportunities to exhibit their talents. He noted that Afreximbank had launched some initiatives and programmes to support African economies and the youth to maximize benefits of the AfCFTA. Professor Oramah further stressed that the bank was committed to disbursing US$25 billion revolving loan during a five year period 2017-2021 to support cross-border trade and SMEs in regional supply chains. Out of this figure, he affirmed that the bank had disbursed about US$15 billion.
He emphasized that governments across Africa had a huge role to play by “supporting the growing and innovative youth entrepreneurs with leadership development opportunities, finance and links to wider markets.”
Professor Oramah said it was imperative that governments support the emergence of Export Trading Companies by promoting the emergence of an innovation ecosystem like Silicon Valley. This idea, which he teasingly branded NILICON Valley, is already taking root with innovation centres sprouting in places like Lagos, Port Harcourt and Abuja, in areas run by foresighted ministries of youth. Professor Oramah called for the inclusion of leadership, soft and digital skills in training and educational programmes as well as encouraging links between the private sector and training institutions. The President of Afreximbank noted, however, that youths must work hard to acquire the skills necessary for the emerging opportunities.
The Chairman of the Convocation Lecture, Professor Rasheed Abubakar, who is the Executive Secretary, National Universities Commission (NUC), said in his closing remarks that Professor Oramah had captured the current innovative challenges in the country and Africa and also showed how to overcome them. He described the lecture as a message of hope to youths. He challenged the Afreximbank to consider Nigerian universities, especially Nnamdi Azikiwe University, in the establishment of its Innovation Technology Laboratories. This, he noted, would help in building the capacity of students, lecturers, entrepreneurs and industrial clusters in Nnewi, Onitsha and neighbouring areas to grow.
The Convocation Lecture was graced by the Vice Chancellor of UNIZIK, Professor Charles Esimone, the Chancellor of the university, members of the Senate of the university, management, staff and students as well as the graduands.