Currency issues least of ECOWAS integration process, says LCCI
Citing the need to address key fundamental issues and non-tariff barriers affecting regional trade among Economic Community of West African States (ECOWAS) member countries, the Lagos Chamber of Commerce and Industry (LCCI), has described the ECO currency concerns as one of the least issues affecting the region.
According to the Chamber, the bigger issues are around the non-tariff barriers to trade, adding that these include complex and corrupt Customs procedures, multiplicity of agencies and checkpoints along the borders, import bans, forex regulations, quality requirements, excessive documentation and many more.
To this end, the Chamber urged member-countries to address the bigger constraints to economic integration first before other matters.Addressing journalists in Lagos, yesterday, LCCI President, Mrs Toki Mabogunje, noted that although the manner of adoption of the ECO by the francophone countries raises concern around the mutual confidence levels between the Anglophone and Francophone countries in the region, other key issues need to be addressed.
She said: “The experience of investors involved in the cross-border trade in the region has been awful. There is also the challenge of weak compliance with the ECOWAS protocols especially around the ECOWAS Trade liberalisation scheme (ETLS). Connectivity between countries in the sub region is also a major problem.
“Over 80% of trade in the sub-region are done by road which creates a great deal of transit problems for movement of goods in the region. There is no rail connectivity within the region. There is weak link by sea because of the volume of cargo destined for the sub region and the economics shipments to the sub region.
“These are the bigger constraints to economic integration which the Heads of States of ECOWAS needs to address. It is important to get priorities right as far as economic integration issues are concerned.”
Locally, she urged economic managers to stem rising consumer prices through increased investment in infrastructure, especially power and transportation, adding that such initiatives would help to bridge supply gaps and reduce transportation costs.
According to the National Bureau of Statistics (NBS), inflation rose to 11.98 percent in December. This marks the fourth consecutive month of rising inflation. Both food and core inflation accelerated to 14.67 percent and 9.33 percent respectively in December.
“Policymakers need to worry about the increasingly intense inflationary conditions, especially the food component of inflation. Rising inflation has a profound welfare effect on citizens as it weakens purchasing power.
“Heightened food inflation naturally escalates poverty conditions as food is basic to human existence. Intense inflationary pressures also have a negative impact on investment as cost of production and business operations increases. This typically takes a toll on profit margins as sales and turnover declines. Similarly, there is a need to address the security concerns in major food-producing areas of the country,” she added.
On his part, the Director-General of LCCI, Dr. Muda Yusuf, said concerns about the depletion of foreign reserves appear to have been doused by the recent US-Iran tensions, which led to a rise in oil prices.He however noted that the approach of supporting the reserves with foreign portfolio investment is unsustainable, considering that portfolio investors may develop apathy for Nigerian assets.