AfCFTA exports: Dangote, Flour Mills, Tolaram make first move
Nigeria officially commenced intra-African trade on Tuesday, July 16, under the AfCFTA protocol five years after officially assenting to the agreement in Niamey, Niger.
Dangote Group, Flour Mills of Nigeria (FMN) and Tolaram are among nine companies that made first exports under the African Continental Free Trade Area (AfCFTA).
Other companies which leveraged the first AfCFTA opportunity are: Hwani Industry Nigeria Limited, Le Look Nigeria Limited, Secure ID Limited, Avila Naturalle, Craft Methods Limited and Ruchim Limited.
Nigeria officially commenced intra-African trade on Tuesday, July 16, under the AfCFTA protocol five years after officially assenting to the agreement in Niamey, Niger.
With the official launch of the Guided Trade Initiative (GTI) and Nigeria’s inaugural shipment under the AfCFTA protocol, the country has transitioned from planning to trade under the agreement to actively enabling businesses to trade. The GTI seeks to facilitate commercially meaningful trading among state parties that have met the minimum requirements for trade under the agreement through the matchmaking of businesses and products for export and import, according to the National Action Committee on African Continental Free Trade Area.
The exports have set the stage for a new era of trade and prosperity for Nigeria as AfCFTA ranks as the world’s largest trade area with a combined gross domestic product (GDP) of about $3.4 trillion and a population of 1.3 billion.
To commence the first shipment under the AfCFTA protocol, the nine Nigerian companies pulled together their made-in-Nigeria commodities and exported from Apapa Port to five countries across east, central, and north African sub-regions.
The first company to receive an AfCFTA Certificate of Origin, which enables businesses to trade under AfCFTA protocol, is Le Look Nigeria Limited. It is a Nigerian company that was founded by Chinwe Ezenwa, a female entrepreneur, specialising in bag-making.
Le Look Nigeria Limited became part of the first AfCFTA shipment by exporting bags to Kenya.
“My journey in making Nigerian bags started 39 years ago and I have been fighting to promote made-in-African goods when people dislike anything made-in-Africa, especially Nigeria. Today, our efforts have taken a centre stage in the world and we are recognised by the Office of AfCFTA and partners in Kenya, Rwanda, and Ethiopia,” Ezenwa told BusinessDay in Lagos.
According to her, makers of Nigerian goods are now penetrating countries within the region and the GTI under the AfCFTA protocol means Nigerians need to be consistent, resilient, and innovative without waiting for the government.
She said penetrating Kenyan, Rwandan, Ethiopian, and Ghanaian markets is easier compared to European and American markets.
“The markets in these countries are huge because they are countries that do not have many industries and Nigeria’s huge population gives it a comparative advantage to gain from the AfCFTA trade area. We only need to make our people more productive by creating efficient work hours,” Ezenwa said.
The second company that keyed into the opportunity provided by the continental trade agreement is Secure ID Limited, a Nigerian company that exported smart cards to Cameroon.
SecureID is led by Kofo Akinkugbe, a Nigerian technology entrepreneur, who is group managing director.
Dangote Group exported clinkers to Cameroon. The group is owned by Africa’s richest man, who owns a $20 billion, 650,000-capacity refinery at Lekki, Lagos.
Another beneficiary is Avila Naturalle, which exported made-in-Nigeria black soap and shea butter to Kenya. The company is owned by Temitope Mayegun, who started the business with 30,000 worth of coconut oil but now has over 400 products across skincare, foods & supplements, water & drinks, and fashion.
Similarly, FMN exported native starch to Algeria. The Apapa, Lagos-based diversified conglomerate, is managed by Omoboyede Olusanya. Its board is chaired by John G. Coumantaros.
Tolaram Group exported wrappers to Egypt. Producer of Indomie Instant Noodles, Tolaram is acquiring Diageo’s 58.02 percent shareholding in Guinness Nigeria.
Also, Craft Methods Limited shipped alcoholic bitters to Uganda.
More so, Ruchim Limited exported Nigerian-made SIM and bank cards to Kenya, while Hwani Industry Nigeria Limited shipped Nigerian-made water closet sanitary sets to Kenya. Hwani was founded in 2021.
Olusegun Awolowo, national coordinator of the National AfCFTA Coordination Office, told BusinessDay on the sideline of the launch that the event demonstrates that Nigeria is ready to participate in formal trade outside the Economic Community of West African States (ECOWAS) countries.
He said the countries listed above are the ones that have signed up for the GTI and the idea will showcase the timeframe it will take for the goods to get to destination countries.
According to him, it will take a long time for Nigeria to adopt and test all the protocols in the AfCFTA agreement.
“With the inauguration, many Nigerian companies will gear up to leverage the opportunity because our goods are of good quality. It was amazing to see sanitary closets and bags made in Nigeria.
“We must raise our level of productivity, entrepreneurship, and manufacturing to compete effectively and dominate Africa,” said Awolowo.
Citing an example, Ezenwa, earlier cited, said the AfCFTA office came to her factory and saw that the ‘Adire’ ‘Akwete,’ and ‘Aso oke’ fabrics used in making Le Look bags are sourced in Nigeria while 20 percent of the raw materials such as zip are imported.
She said a Chinese-owned company can participate in the AfCFTA trade but such a company must come down to Africa to set up its company and also ensure that 80 percent of the raw materials are sourced locally.
Meanwhile, port industry stakeholders said Nigeria must streamline its port processes to make its exports more attractive to global buyers.
Leo Ogamba, president of the Shippers Association of Lagos (SAL), said Nigeria must target a more transparent and efficient port system to reduce delays, cut demurrage charges, and make the country’s exports more competitive on the global market.
“Demurrage fees are penalties shippers incur when they fail to unload their cargo within a designated timeframe. These delays and fees can significantly impact the overall cost of exporting goods, making them less competitive internationally,” he explained.
