IPPA Roundtable Harps on Policy Measures to Address Illicit Trade in Nigeria


Wednesday, July 24, 2018 3.45PM / Proshare WebTV 

Stakeholders at The Initiatives for Public Policy Analysis (IPPA) Breakfast Roundtable today harped on the need for Nigeria to take strong policy measures to address illicit trade that affects the economy of the nation. 

This was the thrust of the discourse which focused on the theme “Business Environment: Maximizing Economic Opportunities through Effective Anti-Illicit Trade Enforcement”. 

Giving the opening remarks at the event, Mr Olusegun Sotola, the Senior Research Officer, IPPA  shared that according to the United Nations estimate more than $1bn is illicitly traded in small arms alone in Africa,  fueling the increasing conflict and criminal activities in the region. 

Speaking further, Mr Sotola stated that IPPA is of the view that illicit trade is largely policy induced, while tax and tariff for example often create perverse incentives for illicit trade. He also explained that the essence of the forum was to show the underlying factors responsible for the growth of illicit trade, the danger associated with it and the economic dis-incentives it creates for local industries, the accompanying revenue loss it has caused the government and undermining healthcare delivery. 

The IPPA in its position identified Operating environment, Unintended Impact of Taxation and Enforcement Imperative as three key points to note in addressing illicit trade. 

In a presentation on “Business Environment and Illicit Trade: Linkages and Evidence”, Dr Olajide Damilola, a Senior Research Fellow, IPPA and the University of Aberdeen, United Kingdom identified Consumer preferences, Business environment and Regulatory framework as key drivers of illicit trade.

Dr Damilola  listed the following as effects of illicit trade on nations like Nigeria;

1.       Health risk to consumers

2.      Tax reduction to the Country

3.      Reduces market share and capacity of local businesses

4.      Damages brand of licit manufactures

5.      Leave an underground economy not captured in the GDP


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In the Global Illicit Trade Environment Index (GITEI) for 2018 , Finland, UK and Sweden according to Dr Damilola ranked the top economies in tackling illicit trade, while Libya, Iraq and Myanmar were the low ranking economies. 

The Senior Research fellow of IPPA called for international cooperation and harmonization of laws and regulations beyond borders to tackle illicit trade. 

International trade expert, Dr. John Isemede in his presentation on “Maximizing Economic Opportunities in Export and Trade” believed that export is a business for professionals, which requires robust research. According to him “Nigeria needs an export policy that is integrated into its foreign and trade policy as a nation”. 

Giving his position on the much debated African Continental Free Trade Agreement, AFCTA, Dr Isemede said “I am not saying Nigeria should not sign the agreement but it should be clear on what it is bringing to the table because South Africa and Morocco already have an advantage”. 

Isemede stressed that the organized private sector in Nigeria must be considered  and carried along in the on-going negotiations around the agreement. 

The former Director General, Nigerian Association of Chambers of Commerce Industry, NACCIMA harped on the need for Nigeria to focus on Backward Integration and Import Substitution to build comparative advantage in engaging African countries on trade agreements.

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