Border Closure: Nigeria Must Get it Right Now

October 25th, 2019

By Oluwapelumi Bakare

It has been months since the Nigerian government closed its land borders to her neighbor countries. The action has generated controversies, locally and internationally, in favor and against, but the vitriolic ones are coming from those profiting from the illegal business activities in and around the borders, killing the Nigerian economy.

In the midst of this, the federal government got support from an unexpected quarter, the International Monetary Fund (IMF), during the last annual meetings of the Breton Woods institutions in Washington DC, lauding its action. The Director of African Department, Abebe Selassie, made the commendation. Selassie said though free trade was critical to the economic growth of the continent, it must however be legal and in line with agreements. He hoped that bilateral engagement and discussion would resolve the matter.

It is a known menace that illegal businesses and smuggling around the Nigeria – Cameroon, Niger and Benin Republics’ borders have been impacting negatively on the Nigerian economy, and this dates back to decades. It is also a known fact that Nigeria controls 70 percent of the West Africa sub-regional economy, but surprisingly, this has not in any way translated to economic prosperity. Neither has her neighbours acknowledged Nigeria’s regional and continental economic importance, not to talk of her impact on their economies. Rather, they have continuously sabotaged and undermined Nigeria not only in trade agreements, but have also compromised her security.

Rather for Nigeria to continue to export jobs and impoverish its own people, the Central Bank of Nigeria suspended 43 items from its official forex window in order to encourage local production and check importation of inferior goods and items that we have the local capacity to produce. When the CBN took the decision, it sought the support of relevant government agencies to rally round it in checking the activities of these economic saboteurs. We may not say that the present action came too late, but as the saying goes , it is better to be late than never. I
commend the effort and courage of the Comptroller General of the Nigeria Customs Service for taking the bull by the horn.

The Nigerian government has said her action was not to punish anyone, but her neighbors despite several engagements at securing compliance with trade treaties and agreements, have flagrantly dishonored and disrespected Nigeria, thus, the federal government was left with no other option than to take this drastic action to restore them back to commitments. This underscored the initial reluctance of the federal government in signing the Africa Continental Free Trade Area (AfCFTA), and if Nigeria must be a signatory, she must ensure that rules are obeyed.

Even on the issue of single currency, Eco, adopted by the Authority of ECOWAS Heads of Government which is to begin in January 2020, the CBN, had also cautioned the sub-regional body, ECOWAS, not to rush into implementing the resolution until all the grey areas are cleaned out. Though some countries have met the convergence criteria for implementataion, others have not.
There are three primary criteria that must be met: having a budget deficit of not more than 3%; average annual inflation of less than 10% with long-term of not more than 5% by 2019. The countries aere also expected to have gross reserves than can finance at least three (3) months imports, and that countries with the sub-region must have public debt or Gross Domestic Product (GDP) of not more than 70%.

With the global economic slow down (of which the sub-region is not isolated), pervasive poverty and insecurity, one is bent to agree with the CBN Governor.

However, within the short period of the closure, Nigeria has witnessed increased local production in rice and other items, thus reducing unemployment and smuggling activities. According to the CBN Governor, Godwin Emefiele, the closure witnessed increased Foreign Direct Investment (FDI) of which he also commended the federal government.

The Comptroller General of Customs, Hameed Ali, summed it up recently, when he announced that the agency generated N115bn in the month of September, the highest ever recorded since the borders were shut. Confirming huge revenue loss around those borders.

Seme and Idi- Iroko, Nigeria/Benin borders and Jibia in Katsina State and Niger Republic borders before the CBN Anchor Borrowers’ Programme on rice were smuggling routes for foreign imported rice. Their activities impacted gravely on rice local production, and dumping of expired imported rice into the country was the order of the day, with resultant jobs loss, loss of revenue and drained foreign exchange earnings.

Shortly after the closure, the Niger Republic government banned exportation of rice and other items prohibited by the Nigeria government into Nigeria, though I have not heard of a similar measure from the Beninoise Government.

I enjoin the government not to reopen the borders until the objectives of the closure are achieved. Nigeria has been taken for a ride too long, and this is the time to show our seriousness and might, and tell these ‘small’ nations ‘enough is enough’.

Nigeria’s sovereignty has been undermined for too long in all ramifications, and it was high time we stamped our authority and might, economically and politically. It is time for Nigeria to get it right, and the time is now.

Oluwapelumi Bakare writes in from Topo, Badagry.

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