Africa on a course to operationalize the largest Trade Arrangement

Treasure Maphanga, Director for Trade and Industry at the African Union (AU) Commission, said, "the unsegregated trade market commonly known as the "African Continental Free Trade Area" (AfCFTA) will be functionalised in July, setting the stage for Africa to start executing measures aimed at promoting the smooth movement of goods and services across the continent.

 

Africa is on journey to functionalise the largest trade arrangement that will change the global economic landscape and improve intra-regional trade all over the continent.

 

"Since the historic decision to sign an agreement to establish the AfCFTA in March 2018, a total of 52 African countries have signed the agreement, while 20 have confirmed and approved the agreement in their national assemblies. Of these, 15 have already deposited instruments of ratification with the AU Commission", said Maphanga.

 

"We are therefore on path for the AfCFTA to become operational by July this year and we are actively planning for this eventuality, expecting the largest free trade area of the world to be launched during the Extra-Ordinary AU summit in Niamey, Niger in July," Maphanga told a Trade Law Centre (Tralac) conference underway in Nairobi, Kenya.

 

"The process has started for the establishment of the AfCFTA Secretariat, and an official report on progress will be submitted to the next meetings of the AU Policy Organs," she said.

Once the AfCFTA becomes functional, the next step for Africa is to launch a continental Common Market.

 

A Common Market is a higher level of combination where countries remove all trade hurdles between themselves, establishing common tariff and non-tariff hurdles for importers, and also allowing for the free movement of labour, capital and services between themselves.

 

"It is important for Africa to continue working together to make sure that the AfCFTA is a success because the unsegregated market has the capacity to transform Africa's political independence into sustainable economic development", said Maphanga.

 

According to the AU, the AfCFTA when fully functional is expected to boost and rise African intra-regional trade from the current 10 percent to about 40 percent.

 

Consumers in the region are now getting better products at lower prices cause of increased production, while producers are benefiting from a tariff-free trade for all goods originating within the region.

 

AfCFTA will go a long way in promoting the smooth movement of goods and services across borders, also allow member countries to balance regional trade policies to promote equal competition and increased trade.

 

The AfCFTA will also solve some of the challenges of multiple and overlapping memberships and accelerate the regional and continental blending processes.

 

The AfCFTA brings together all the 55 AU Member States, creating a combined market of more than one billion people and a combined Gross Domestic Product of more than US$3.4 trillion.