Trading for Peace

There is no doubt that conflict and violent conditions affect economic activities. A conflict-ridden society is often faced with food insecurity, rapidly decreasing economic activities, with basic amenities usually destroyed by violence. In addition, there is a tremendous reduction in skilled and unskilled labour for production. The labour force, who are predominantly youths, are caught up in the war as victims or members of armed groups. The prevalence will most likely deepen if there are no other alternatives for providing necessities ruined by conflict.

Developing countries battling with internal civil conflicts and a reluctance towards free trade will likely experience harsher realities of violent conflicts than free trade countries with the same security challenges. In another probable sense, free trade in conflict-ridden societies could also trigger spill-over conflicts.

Yesterday, Nigerian President, Muhammadu Buhari, signed a landmark agreement at the African Union (AU) summit in Niger. The agreement which will create the world\’s largest free trade area is expected to lead to 60% boost in intra-African trade by 2022. With Nigeria signing the African Continental Free Trade Agreement (ACFTA), what implications does it have on its security challenges and other countries in the Sahel region?

Prevailing conditions around the Lake Chad Basin, for instance, will potentially take a new dimension. Parts of Northeast Nigeria where insurgency has been strife is facing dire economic conditions. Free trade from neighbouring countries will provide alternative opportunities for stable market, demand for skilled and unskilled labour, etc. There is also the tendency for open markets across national boundaries to draw teaming population of unproductive youths to market their labour in other neigbouring countries with much more stable economic conditions.

Free trade encourages international trade. Since unstable local economies tend to negatively impact on international trade, countries in trade agreement are likely to offer support in terms of border surveillance(for neighbouring countries), military assistance, financial aids to address internal schisms that might have impact on international trade or trigger spill-over conflicts.

While boasting income levels and technological transfer, free trade will create jobs and opportunities for economic growth. For a long time, Boko Haram has been able to maintain its recruitment pipeline largely due to the surging population of out-of-school children and youths not engaged in productive ventures in mostly some parts of the Northeast region of Nigeria. With free trade, bordering countries in the Northeast region will become new markets for terrorism-ravaged communities.

However, Nigeria’s challenge is not merely about signing the trade agreement. What is important is having a holistic, efficient, effective, and implementable economic policy that will protect the nation’s domestic industries and help SMEs to flourish. Nigeria has to move away from a mono-resource economy. Identify few sectors, especially SMEs and technological initiatives, in which the nation has comparative advantage and use such sectors to pursue export plans. These sectors should be provided with access to finance, and support to enhance their capacity.

For Further Reading, Click: Trading Away From Conflict