The Manufacturers Association of Nigeria (MAN) has restated its opposition to the Economic Community of West African States (ECOWAS) /European Union (EU) Economic Partnership Agreement (EPA), saying it would cost the country about $1.3trillion in lost revenue from tariff removal.
Its President, Dr. Frank Jacobs, in a statement, insisted that signing the agreement would have adverse effects on the economy and may spark socio-economic crisis.
He said as a result of the mismatch of the two regions in terms of technology and manufacturing experience, accepting EPA in its present form would spell doom on the nation’s industrialisation programme.
He said: “It should be borne in mind that Nigeria is in recession and needs every effort to pull it out. Nigeria is mainly a commodity-goods producing country and would trade same in an EPA free trade arrangement. We have limited capability to produce and export industrial goods to Europe.”
The MAN chief stated that EPA in its present form will stifle existing manufacturing industries as they would be uncompetitive because cheaper finished products from European countries would flood the local markets and would lead to the de-industrialisation of the country. This he argued could have implications on employment generation and poverty alleviation in addition to loss of investments.
Jacobs pointed out that recent policy of resource-based industrialisation which is adopted by the government aimed at utilising the abundant natural resources of the country to sustain the manufacturing sector will naturally be destroyed.
He also said it would lead to the closure of companies that currently have been galvanised to invest in the production of raw materials and intermediate products and undermining the Nigerian Industrial Revolution Plan (NIRP).
According to him, Nigerians will continue to be exporters of unprocessed raw materials and importers of processed goods and become an extension of EU market.
He further said current efforts by manufacturers to export non-oil products would be greatly hampered. The recent surge in the export of non-oil products which has grown tremendously would be drastically affected, he added.
Other effects are that it would negatively affect the informal sector and the SMEs which are currently sustaining a large percentage of the population while incurring significant revenue loss through removal of tariff estimated at about $1.3 trillion. It would also have negative effect on the nation’s other trading partners such as the United States (US)and China especially in the context of Most Favoured Nation (MFN), he added.