By Adedapo Adesanya
The World Trade Organisation (WTO) has expressed concerns over the high rate of physical inspection of containers at Nigerian ports, urging the country to review its customs procedures to promote timely and cost-effective practices.
Members of the Trade Policy Review organ of the organisation also stated that longstanding import prohibitions on a wide array of agricultural products, coupled with tariff peaks and additional levies, had the potential to worsen food insecurity, higher food price inflation, and negatively affect private sector investments in the agricultural sector.
Those were part of the submissions made by members of the body during the recently concluded sixth Trade Policy Review of the WTO, which focused on Nigeria in Switzerland.
The Ambassador of Nigeria to WTO, Mr Adamu Abdulhamid, who doubles as Chairperson of the WTO Trade Policy Review Body for the 2024/2025 period, explained that the review provided Nigeria with a good opportunity to better understand and discuss the country’s trade policy developments since its previous review in 2017.
The body appreciated Nigeria’s active participation and constructive role at the WTO, including by ratifying the WTO Fisheries Subsidies Agreement.
It also highlighted Nigeria’s constructive engagement in ongoing negotiations and its instrumental coordinating role concerning fisheries subsidies and agriculture negotiations.
Nigeria was also encouraged to join the Multi-Party Interim Appeal Arbitration Arrangement and the Government Procurement Agreement, as well as to incorporate the Services Domestic Regulation commitments into its WTO schedule of commitments.
“Members welcomed Nigeria’s initiative to undertake significant economic policy reforms against a particularly challenging global economic environment to strengthen its macroeconomic and fiscal situation.”
The key three areas were highlighted in particular, including the removal of fuel subsidies, saying by doing so Nigeria also sought to achieve positive results in the fight against climate change.
There was also the need of an introduction of a floating and market-driven foreign exchange rate system and removal of restrictions on the use of foreign exchange for imports.
The body also said efforts to improve the business and trade environment, including adopting a new customs code, starting to improve tax administration, and enacting new copyright and competition acts, must be followed.
It was pointed out that members also stressed that transparency and predictability in the business and investment environment would benefit from further reforms, including by improving the complex regulatory Technical Barriers to Trade (TBT) and Sanitary and Phytosanitary (SPS) frameworks.
Members also praised Nigeria’s various growth and development plans as well as its new trade and investment policies aimed at diversifying the economy.
“They also expressed strong interest in better understanding the implementation of existing subsidy schemes. In this context, some delegations noted the increasing share of trade in goods and services in Nigeria’s GDP and highlighted the increase in the share of the manufacturing sector in GDP, which nearly doubled from 8.6% in 2017 to 15.7 per cent in 2023.
“Members lauded Nigeria’s efforts on trade facilitation and for streamlining its customs procedures, including by introducing the Authorised Economic Operator scheme in 2024,” a statement said.
On tariffs generally, members expressed concern that Nigeria had bound only 19.7 per cent of its tariff lines, with the average bound rate standing at 120 per cent, while the average applied rate was 12.8 per cent in 2023.
In this regard, members encouraged Nigeria to enhance predictability and good governance and to increase its binding coverage as well as reduce the bound rates.
There were also concerns over the high number of outstanding notifications by Nigeria, including on anti-dumping, agriculture, subsidies, State Trading Enterprises, quantitative restrictions, and import licensing.