by MTHULISI SIBANDA
JOHANNESBURG – THE African Continental Free Trade Area Agreement (AfCFTA) can help leapfrog and position the continent in a global competitive advantage after the coronavirus (COVID-19).
In full swing, AfCFTA will represent one of the greatest trading areas since the beginning of the World Trade Organisation (WTO) 25 years ago.
These are the sentiments of the Pan African Chamber of Commerce Chief Innovation Officer, Phumza Dyani, as the world contends with the COVID-19 pandemic.
“Africa for a very long time has been a consumer of foreign products and has been the biggest importers of foreign goods,” she noted.
“…but this is the time for Africa to consolidate efforts and trade
amongst each other. A noble idea indeed and logical. This is the beauty of what the AfCFTA presents.”
The executive corroborated the United Nations Economic Commission for Africa (UNECA), which states that AfCFTA aims to reshape the continent’s social, investment and trade arena in a fundamental manner.
It lays the foundation for the African Customs Union, a cornerstone of the African Union (AU) Agenda 2063. The goal is the elimination of tariffs and other barriers to free trade, resulting in free movement of goods, services, investment and people.
“We are one Africa and therefore we should be one market and this can be a lucrative market compared to each country’s battle for leftovers approach,” Dyani said.
However, she highlighted the continent first needed ground-breaking and innovative ideas and solutions that could address socio-economic challenges Africa was likely to face as a result of COVID-19 and beyond.
Dyani believes ongoing digitalisation is paving the way for a new
African economy, with e-commerce platforms and internet penetration expediting transactions, reducing costs and leading to a new generation of transnational digital consumers.
African governments, she added, need to capitalise on the opportunities associated with digitalisation, by bolstering regulatory environments and supporting the development of digital ecosystems.
“We need to review how we are structured as a continent,” Dyani said.
“Gone are the days of merely being a minerals supplier to the rest of
Africa also needs to focus on industrialisation in order to provide for
goods and services to be traded amongst countries.
Investment in infrastructure and telecommunications will be crucial to the implementation of AfCTA, Dyani added.
The African Trade Report 2019 notes that the continent’s contribution to global trade remains marginal at 2,6 percent.
While intra-African trade rose to 18 percent in 2019 from 5 percent in 1980, it remains low compared to intra-regional trade in Europe and Asia.
AfCFTA, scheduled to launch sometime early 2021, once completed, will have a combined gross domestic product (GDP) of more than $2 trillion and 1,27 billion people.
– CAJ News