The news that rocked the nook and cranny of West Africa was Federal government of Nigeria closing her land boarders against importations; this has generated a lot of criticism from the citizens and some people who are directly or indirectly affected.
But I want us to look at the issue from different perspectives, compare and contrast. Then you can decide to make your conclusion.
Advantages of Importations Through Land Boarders
i. Employment opportunity to some individuals working in the clearing and distribution units.
We know that jobs are being provided for some individuals who work as marketers or in the
distribution chain. We can say this is a plus to importation of finished goods.
ii. Source of income to stakeholders. The business is a source of income to the importers and
their family members.
iii. Availability of international goods and services. Through importation there are varieties of
international products in the market for the buyers.
iv. Competition with local manufacturers/producers. Importation creates competition with
local products which may be help to curb exploitation of buyers by manufacturers and
sellers.
Disadvantages of Importations Through Land Boarders
i. Land boarders are the weakest and could be a source of economic leakages. Because
smugglers could create paths through the forest and other areas to smuggle things into the
country and this would create unhealthy competition against local products and legally
imported products.
ii. Importation of finished goods usually leads to redundancy of local intellects. When finished
goods that has substitute in the country are being imported, it does not allow local
manufacturers to develop their intellectual capacity.
iii. It is a big challenge to the local manufacturers as imported goods may compete in price and
quality. The death of local manufacturers is only with limited time as imported goods may
have cheaper cost of production and distribution than locally manufactured goods.
iv. Capital flights. Money is leaving the economy to other countries because we are buying
from other countries. When goods are being imported the importing country pays the
exporting country. Both in long and short term, the importing country is losing while the
exporting country is gaining.
v. Terrorism thrives through land boarders. With the closure of boarders, supply of fire arms
and accessories are minimized to the possible minimum.
Disadvantages of Land Boarder Closure
i. Importers who have ordered for perishable goods may lose them as a result of the closure of the land boarders. It is true key that closure of these boarders may lead to loss of goods to importers who are yet to clear their goods or whose goods are yet to arrive.
ii. Loss of income and jobs of distributors of importers and their staff. The importer would lose their funds and the income from those sales of imported goods. The staff of those organizations would also lose their jobs.
iii. Relationship frictions between Nigeria and neighboring countries. The federal government has shut trade opportunities with neighboring countries that can easily transport their goods via land to Nigeria. Land transportation is considered as the cheapest and these would make their goods to compete healthily with the locally manufactured goods.
Advantages of Land Boarder Closure
i. Local intellectuals become active. When there is a larger market with less competition from across the boarders, it makes it easy for local intellectuals to become active and thrive.
People would bring in innovations from across the boarder and would improve on it.
ii. Local manufacturers would be able to utilize local resources to create more jobs in the long run. Because the demand for the goods remain the same and there is scarcity due to embargo on or reduction of imported goods; local manufacturers would want to produce more and that would lead to creation of more jobs in the factories and the distribution chains.
iii. Development of local manufacturing industries for economic growth. More industries would spring up and that would lead to increase in Gross Domestic Production (GDP) and generation of revenue for the government.
iv. Retention of capital. Before we have funds leaving the country because we have to pay it to the manufacturing countries; now we have those funds retained and circulate within the economy.
v. Reduction in cost of goods and services in the long run. Because more manufacturers would rise; supply would increase than demand in the market and the prices of goods and services would eventually falls.
vi. Alleviate pressure on foreign currencies, which in return may lead to devaluation of our currency putting our country at the receiving end.
In conclusion, with the above itemized benefits and disadvantages, let us make our choice of what to believe. But I believe the advantages in the long term would be beneficial to every citizens of this country.
