Zenith Bank has signed an agreement with the secretariat of the African Continental Free Trade Area (AfCFTA) to digitalise trade relations across the continent
Nigeria’s Zenith Bank has signed a Memorandum of Understanding (MoU) with the African Continental Free Trade Area (AfCFTA), to develop the SMARTAfCFTA portal. The SMARTAfCFTA portal is an initiative of the bank to digitalise trade, according to the Secretary-General of the AfCFTA Secretariat, Wamkele Mene. The GMD of Zenith Bank, Dr Ebenezer Onyeagwu and the AfCFTA General Secretary signed the agreement during the 2023 international trade seminar of Zenith Bank today.
Setting the stage for the agreement, Mene explained that it is very important to stop relying on Europe’s imports to feed. African countries need to be self-reliant and be able to cater to all their needs alone in case of a war or pandemic. This is even more so at the height of global economic shocks and inflationary pressure. “55 African countries contribute 3.1% to global GDP and 2.1% to global trading. Yet Singapore singlehandedly contributes over 6% to global trade and output. This deficit is an opportunity for Africa to accelerate competitiveness,” Mene said.
Nigeria is unclear in its stance on exporting
Nigeria has demonstrated a high commitment to the implementation of AfCFTA. This was occasioned by the implementation of the AfCFTA agreement in 2021 which the past president, Muhammadu Buhari, adhered to. However, it is yet to finalise its tariff schedule as well as unveil guidelines and implementation strategy for the trade deal. So far, seven countries, Rwanda, Cameroun, Egypt, Ghana, Kenya, Mauritius, and Tanzania have been selected to trade under the AfCFTA framework in a pilot phase. Nigeria is still dragging its feet in 2023.
To date, the West African nation still struggles with issues of port congestion and repatriation of FX earnings. This matter has been complicated by President Bola Tinubu’s moves to loosen the control of the naira and eliminate Nigeria’s multiple exchange rate windows. Two months after a naira float that was supposed to unify rates, a significant arbitrage is emerging again.
Zenith Bank commits $1m to the project
Mene admits that a million dollars has been earmarked for the development of the SMARTAfCFTA portal. He is confident that this financial support by Zenith Bank will improve trade, while opening up the digital economy, especially in financial services. According to him, the continent imported $16 billion pharmaceutical products in 2019— this overreliance on foreign economies would stop once this portal is developed. He also adds that rules of origin restricting trade with other African countries have been sorted to 90%. Hence, significant opportunities await.
Both the GMD of Zenith Bank and the Secretary of the National Action Committee on AfCFTA agree with this. “The MoU will showcase African products and services and where they can be found,” Onyeagwu said.