Problems facing regional integration in West Africa

In a group interview in September, 18 disgruntled truck drivers in Cotonou, Benin, vented their frustrations to two Trade Hub consultants: driving freely from Cotonou to Ouagadougou was impossible without harassment, they said. They sometimes spend three days at borders where customs officials hold up paper work when they refuse to pay bribes; meanwhile, their clients in importing countries wait impatiently to receive the goods.
At the borders and checkpoints where unofficial fees were demanded, they do not receive receipts to prove payment later to their clients. Like many other transport companies in the region, they bear costs and lose income due to unpredictable expenses on West African roads and borders.

“Even when you have all the paperwork, it is not always taken into account,” one said. “There is not a lot of documentation required really, but there are too many unnecessary delays.

“Laws are different from country to country and the fees are exceptionally high. There is really no free movement across West Africa.”

But in the agreements made between ECOWAS countries, that is not supposed to be so.

What is described in the article is the official side – which means that it concerns goods that would normally be allowed to enter into countries, either because they originate 100% from a country within the Community (mostly agricultural produce, livestock, etc) or because some form of value (officially, it should be at least 30% of the value of the product) is added in one of the countries.

Then there is the informal type. Nigeria, for instance, imposes bans on, well, almost everything that is of interest to someone of power in Nigeria. But that does not stop the importation of those things. Importers simply divert the trade to Benin and then smuggle them from Benin to Nigeria. Rice is a particular case in point. In 2007, for instance, a Nigerian newspaper reports that the total import duty on rice in Nigeria came to about 100%, while in Benin it was 38%. In the same year, it was estimated that about 2,000 tonnes of rice was re-exported (smuggled) from Benin into Nigeria per day. If you are a smart importer you simply divert your rice to Benin, pay the import duty – and those guys are pretty well organised so you WILL pay the duty – and then smuggle it into Nigeria. While I was researching these issues in Cotonou in 2008, someone mentioned that she could almost believe that the Beninese government bribes Nigeria to prohibit the importation of some goods into the country so that Benin can make some money off it.

The long and short of the story is: as long as there are these kinds of trade policy disparities within the region, regional integration is going to be something they periodically pay lip service to.

Back to the West Africa Trade Hub article:

“Making regional integration a reality requires harmonization of trade policies and practices to eliminate uncertainty for traders and customs officials at borders,” said Trade Hub Business Environment Advisor Lori Brock. “There is a price to pay when a region fails to come together following agreements, regardless of language or currency barriers.”

H/T to Osize