Africa-Press – Eswatini. African Export-Import Bank (Afreximbank) has called on Nigeria to lead the implementation of an effective regional transit guarantee scheme under the new transit regulation endorsed by the Economic Community of West African States (ECOWAS).
Speaking at the inaugural session of the Customs Partnership for African Cooperation in Trade (Customs PACT) held in Abuja, Nigeria, from 17 to 19 November, Mrs. Kanayo Awani, Executive Vice President for Intra-African Trade and Export Development at Afreximbank, emphasized the challenges posed by the current interstate road transit regime in the region. One of the key challenges is the absence of a regional transit guarantee, which leads to an overreliance on physical escorts by customs for goods in transit, increasing costs and creating inefficiencies.
Mrs. Awani stated that Afreximbank is eager to collaborate with Nigeria, ECOWAS, and the ECOWAS Bank of Investment and Development to support the implementation of a regional transit guarantee system that will complement the efforts of national insurers and chambers of commerce, empowering them to enhance their capacities.
She further noted that Afreximbank is currently rolling out a US$1-billion transit guarantee scheme to facilitate the movement of goods across Africa. This initiative addresses persistent transit challenges and responds to customs authorities’ concerns regarding the illegal entry of goods into markets and the potential loss of customs duties and taxes.
Under the Afreximbank African Collaborative Transit Guarantee Scheme, a single transit bond is issued to secure customs duties. This significantly reduces bureaucratic hurdles, smoothens cross-border trade, eliminates the need for multiple transit bonds, and greatly lowers business costs.
Mrs. Awani also shared that the scheme is already operational in the Common Market for Eastern and Southern Africa and the East African Community (COMESA) under a US$300-million facility with ZEP RE (PTA Reinsurance Company), based in Nairobi, Kenya. She added that once fully implemented across the continent, the scheme could save at least US$300 million annually in transit costs.
She highlighted Afreximbank’s willingness to work with Nigeria and other African countries to establish one-stop border posts and related infrastructure. She referenced Afreximbank’s involvement in the modernization of the Beitbridge border post between South Africa and Zimbabwe, which resulted in a reduction in clearance times from 3-5 days to a maximum of 3-5 hours.
Mrs. Awani explained that Afreximbank supports this event because it recognizes that unresolved soft infrastructure issues, particularly in customs and trade facilitation, could hinder the free movement of goods under the African Continental Free Trade Area (AfCFTA). She cited Africa Union Development Agency (AUDA-NEPAD) data, which shows that 75% of delays in the movement of goods are due to trade facilitation issues, with just 25% attributed to infrastructure gaps.
She also discussed the challenges of non-harmonized systems and the lack of interoperability between national customs systems, which fail to communicate with one another.
H.E. Bola Ahmed Tinubu, President of Nigeria, sent a message of endorsement to the Customs PACT, stating that it aligns perfectly with the Nigerian government’s commitment to regional integration, trade facilitation, and enhancing Nigeria’s and Africa’s competitiveness in the global economy.
The Customs PACT roundtable aimed to revolutionize customs and business cooperation, promote intra-African trade, and position Africa as a formidable player in global trade. The event was organized by the Nigeria Customs Service, in collaboration with Afreximbank, the AfCFTA Secretariat, and supported by the World Customs Organization.
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