Nigeria Reopens Borders After Shutdown Raised Prices
Nigeria Reopens Borders After 16-Month Shutdown Raised Prices
Nigerian President Muhammadu Buhari ordered the reopening of the nation’s land borders, ending a 16-month shutdown that raised food prices and curbed regional trade.
Lifting the restrictions will help smooth the implementation of the African Continental Free-Trade Area, a continent-wide agreement that comes into effect on Jan. 1. It will also help rein in transport costs that had surged because of the restrictions on moving goods to countries including Ghana and neighboring Benin.
“With the reopening the inherent costs of closure are now eliminated,” Seth Twum-Akwaboah, chief executive officer of the Association of Ghana Industries, said by phone. “The cost of shipping by land was becoming higher for our members because of the tall order of border checks. Instead of days shipments were taking months on the road.”
Buhari ordered the frontiers closed in August 2019 to halt the smuggling of rice, arms and drugs into Africa’s largest economy. The action brought once-thriving border towns to a near-standstill, with supply constraints contributing to the highest Nigerian inflation rate in almost three years.
Food costs, which account for more than half of Nigeria’s inflation basket, rose 18% in November, adding to chlallenges in an economy in the middle of a recession that the World Bank estimates could push 6.6 million more Nigerians into poverty.
Four of Nigeria’s main land borders will reopen immediately, with others to follow by Dec. 31, Finance Minister Zainab Ahmed told reporters Wednesday. A ban on imports of rice, poultry and other products will remain in place and be enforced by border-patrol officers, she said.
©2020 Bloomberg L.P.