The European Union has explained that Nigeria has nothing to fear in signing the Economic Partnership Agreement (EPA) as it will be in its own interest to do so.
EPA is a trade agreement being promoted by the European Union to ease trade between member nations of the EU and the Economic Community of West African States (ECOWAS). While many other ECOWAS member nations have so far signed the agreement, Nigeria has remained undecided chiefly for fear of losing revenue from import duties and the possibility of the nation being turned into a dumping ground for European goods.
But speaking at a press conference to announce the programmes for the 6th edition of the European Union-Nigeria Business Forum scheduled to hold in Lagos from October 5th to 6th 2017 in Lagos, the Head of Trade and Economic Section, The European Union, Mr. Philippo Amato said that EPA was packaged to held speed up the economic development of ECOWAS member states.
He said EPA is not just about import and export, but to improve the business environment. According to him, there is a very important part of the agreement which is called the rules of origin. “The rules of origin provides that the goods produced in a member state will enjoy low tariffs and free access to EU markets, what that means is that investors looking towards EU markets and who wish to take advantage of the free access and low tariff will come and set up their factories in Nigeria and export their goods to EU markets as Nigerian products, this could make Nigeria an industrial hub for West Africa,” he said.
He said that what Nigeria will lose as revenue from import duties is only about 3% which could be compensated for through diversification of the nation’s revenue sources and export products from oil.
In his words: “What Nigeria need is not the diversification of the economy, that is already done, what Nigeria needs is to diversify its export products, there is still too much reliance on oil. Again Nigeria also needs to diversify its revenue sources and make tax collection more efficient.”
He said that the import goods that will enjoy the low tariff under the EPA are basically machinery, petrochemicals and other input goods that will help the local economy. “All the agribusiness and other final goods that can be manufactured in Nigeria still enjoy protection from the imported ones. Protection is good if it is for a limited period of time otherwise you will keep the economy inefficient and you are not really promoting your industries. You need to face competition to make your manufacturers efficient and able to exist in the globalized world.”
He informed that this year’s forum with the theme: Youth as an engine of Broad-based Economic Transformation, will focus on the role of youths in the information and communication technology (ICT) and agribusiness, which are key sectors to support the growth and diversification of the Nigerian economy.