Why is China offering tariff relief to African countries?

CGTN Europe

CGTN Europe interviewed Dr. Yonov Fred Agah, Nigeria’s former Permanent Representative to the World Trade Organization

Transcript

00:00Let's take a closer look at the trading relationship between China and African countries.

00:05It has seen rapid growth over recent times.

00:08China has been Africa's largest trading partner for the past 16 years.

00:14Last year, trade grew by nearly 5% year-on-year to over $295 billion.

00:21And it's on track to grow even more, hitting a record high in the first five months of this year.

00:25Trade up more than 12% to $134 billion.

00:31Dr. Yonofred Agar is Nigeria's former permanent representative to the World Trade Organization.

00:38He currently advises businesses wishing to invest.

00:41I asked him about the significance of Beijing's willingness to drop tariffs for 53 African countries.

00:47China already has a duty-free, quarter-free market access, preferential regime for least developed countries.

00:59And of the LDCs, 33 of them are in Africa.

01:04So already, 33 out of the 53 countries are already having some favorable preferential access to Chinese market.

01:16It depends also on the products.

01:22Which are the products?

01:23Are they commercially meaningful?

01:26Are there products that China currently has high duty rates?

01:31And then, finally, it also depends on the rules of origin.

01:38What kind of rules of origin is China going to apply?

01:41Will it be accumulation that allows production across different countries in Africa?

01:48Could it be rules that allow for third-party inputs into the production process?

01:55This agreement also calls for African countries who are facing tariffs from the United States

02:01not to do anything in those agreements with America to the detriment of any other African countries.

02:09How difficult is that going to be?

02:11For example, Nigeria is facing 14% tariffs, but South Africa is facing 30%.

02:18How hard is it going to be to stand as one?

02:22Well, I mean, there is something you call solidarity.

02:29Staying together is a matter of solidarity.

02:32For some, it may be painful.

02:34For others, it may be less painful.

02:37But what sacrifice can you give in order to stay together and benefit collectively?

02:45China dominates in terms of trade across Africa.

02:49But we know as well that the United States of America does still have very strong trade ties,

02:55even with your country, Nigeria.

02:57Are you confident that this agreement with China is not going to get in the way of your trade relations

03:03and your diplomatic ties with the United States?

03:08I don't think so.

03:09I don't think so.

03:10The political ties between Nigeria and the U.S. are deep-rooted.

03:19I mean, they have spanned over several decades since independence.

03:24And the composition of trade between Nigeria and the U.S., between Nigeria and the U.S. is rather complementary.

03:34I don't think it is at cross purposes.

03:37If we look at Chinese consumer products coming into Nigeria, they are mostly electronics, phones, and things like that.

03:46If you look at Nigeria's trade with the U.S., it's mostly around commodities and technology.

03:56So it's complementary.

03:59I don't think so.

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