The African Continental Free Trade Agreement (AfCFTA) which establishes a single market for goods and services, connects 1.3 billion people across 55 countries with a combined Gross Domestic Product (GDP) valued at $3.4 trillion, allowing free movement of business travellers and investments, and creating a unified customs union to streamline trade on the continent.
Experts said the questions begging for answers are how much of this projected sum of $3.4 trillion will be accrued to the country? How will much of an impact will this pact have on Nigerian businesses? Needless to state that the country’s over 200 million population is a huge market that is very vital to the success of the trade agreement.
Based on a recent survey of 1,804 Nigerian manufacturing enterprises, six out of 10 businesses expect the AfCFTA to lead to a reduction in material and labour costs, increase production capacity, expand the market and consumer size, and reduce prices.
Overall, Nigeria’s small and medium-sized businesses are optimistic about the opportunities created by AfCFTA, although with mixed feelings grounded in concerns about rising foreign competition and dumping of substandard goods.
The Manufacturers Association of Nigeria (MAN) also re-echoed the same concern. It reemphasised that dumping is a huge challenge that may hinder manufacturers, even as it stressed the need to ensure that all participating countries obey the Rule of Origin policy that is expected to govern the trade.
The Rule of Origin is a criterion where participating countries must source their products locally. There is also a provision to guide against the transhipment of products outside the African market.
But the immediate past president of MAN, Mansur Ahmed, had argued that while some countries would ensure that these regulations were complied with, others unfortunately, would not do so, and this therefore, calls for an effective monitoring mechanism to be put in place to ensure that all countries do the right thing.
Conservatively, Nigeria loses about N15 trillion to fake goods annually and is ranked amongst the world’s highest markets for fake and substandard goods.
The Standards Organization of Nigeria (SON) said the country has groaned under the yoke of fake and substandard products, describing it as a threat to the economy which is also affecting the industrial revolution plan and if unchecked, would affect the country’s fortune in AfCFTA when it fully kicks off.
AfCFTA, If fully implemented, according to World Bank, is estimated to boost regional income by seven per cent or $450 billion speeding up wage growth and lifting 30 million people out of extreme poverty by 2035 and Nigeria is determined to get a fair share of this market with the introduction of the Product Authentication Mark (PAM), an initiative of SON to mitigate the impact of substandard products’ dumping in the country and counter fraudulent businesses in the region that may want to circumvent the Rules of Origin implementation.
LEADERSHIP checks revealed that PAM is applied on each product to ensure traceability and tracking of imported and local products (Products certified by SONCAP and MANCAP can apply for the issuance of PAM stickers).
It is issued as a sticker with security features and a QR code which can be scanned by a smartphone. It is embedded with 20 security features and will position local manufacturers to take competitive advantage of the nation’s involvement in the continental trade agreement.
It will also help in reducing the number of Nigerian-made products that have been rejected internationally.
However, because of the rampant application of the Mark on non-certified products, SON now controls the printing of the features through physical and digital technology.
The agency said Nigeria presently with an estimated population of 220 million, and the African population is estimated at 1.2 to 1.3 billion, if a comparison were drawn, that means the country makes up almost 20 per cent of that population so every African country will be targeting the nation as a market and so PAM came in the niche of time.
Director-general, SON, Mallam Farouk Salim, said the scheme will empower consumers at the point of purchase.
A statement from the agency said, “ In line with Section 5 of the SON Act No. 14 of 2015, SON has been empowered to ensure the authenticity and traceability of products certified to meet the requirements of the relevant Nigeria Industrial Standards(NIS) or other approved specifications.”
The statement further explained that PAM was introduced to ensure effective control of non-complying products in the Nigerian market and to protect genuine importers from faking and product adulteration by ensuring that only SON-certified products are in the markets in the long run.
“With this, if you are bringing in goods, your product must be certified and if is certified it will be given the Product Authentication Mark (PAM) and it will be in our market.
“So, if you come with a sub-standard product that is not certified it will not be allowed.
“With that, the issue of dumping even through the free trade agreement will be reduced to the barest minimum.
“The world is a global village, this technology is not purely our own. we saw other standards bodies in other countries even in Africa do it and we visited and saw what they were doing, their stamp stickers have four security features, but we are looking at the intelligence of our people which if harnessed will make us one of the best-digitised people on earth,” Tersoo explained, adding that the agency decided to go from four –20 security features and the stamp is also waterproof.
“So with four to 20 security features, you must be a busybody to crack 20 features which will cost you more than the cost of doing that sticker and the sticker is per product not per group and for each product, the number is unique, they are not replicated, they are alphanumeric and there is no duplication so with that, the security is enhanced better than those we even took it from particularly the countries in the East and South Africa.
“In West Africa, Ghana, Sierra Leon and Liberia who even came to discuss with us have already started it and they are doing very well.
“As I said, sub-standard good is a problem for the nation, it makes our local industry not thrive hence creating unemployment. The many youths on our streets, if most of the industries are working, will have jobs hence they will not be on the streets and nowhere in the world does the government give jobs to everybody.
“It is the private sector that provides the job that many of our teeming youths will get and as I said earlier, our population is increasing daily and the middle class which is the younger age is jobless hence, if most of them get jobs they will be getting employed by the local manufacturing companies,” SON’s director of product certification, Mr Tersoo Orngudwen, said in a recent interview.
According to him, with the effective implementation of PAM, many investors will come into the country because there is no fear of counterfeiting manufactured products.
Also, businesses in the country will ensure they have good manufacturing practices and satisfactory analysis reports for their products.
Tersoo disclosed that a nationwide sensitisation of PAM would first start with Lagos where most of the country’s imports berth.
He explained that the choice of Lagos as a first port of call was a deliberate attempt to involve the importers of goods because the stamp will be provided there.
“When we are sure of the quality of goods that have arrived, then we give you the stamp based on the number of goods that we inspected.
“So, we want to engage the importers of these goods for direct retail into our markets so that they will have the stamp and we will also use the jingle to convince consumers and so on.
“ We are targeting Lagos first which is one of the most popular states in the country, then we follow Kano, then we will go also to Port Harcourt and then we will follow other states.
“Eventually, we will go to all the states in the country even making the sensitisation in the various languages in the various states so that even the common man in our hinterlands will know because the tendencies of the counterfeiters and fakers are when we put more pressure on them in the urban areas they migrate to the rural areas where they think the information has not reached.
“ We will come to Abuja being our administrative capital so consumers here will know what is up for them to have value for their money.
“The programme is designed such that the product has the stamp on it and you have the QR code either on your Android phone or there is a number on the stamp on the product. If you don’t have an Android phone or an IOS phone, you can send the number of the product on the stamp to a code, a toll-free code 281 and within 5 seconds, they will return a message telling you that the product is certified by SON and is good for use. If it is an Android or an IOS phone, you just download SON Palm, keep it on your phone, walk into your shop, whether it is locally manufactured or imported good, check if it is on it, scan and send the message directly to our server and as I said in the beginning, the server has a GPRS connection that will indicate the location where those substandard goods are. “With that, the SON staff who are in the enforcement unit that is to be connected to the system will know where such products are in different locations in the various states.
“As I did emphasise, the consumer themselves are the number one enforcement officers because if they scan and refuse to buy a substandard product, it will remain there on the shelf and SON will be notified through the GPRS on their server.”
Stakeholders said Nigeria is now in good stead to reap the full benefits of AfCFTA as
PAM complements the existing Nigerian Industrial Standard (NIS), MANCAP and SONCAP in ensuring that consumers are protected from the menace of substandard, cloned and counterfeited products.