Commencement of trading under the African Continental Free Trade Area (AfCFTA) has rekindled hope for increased intra-African trade, with prospects pointing to growth of 50 percent in the short to medium terms.
The AfCFTA Secretariat says about 47 countries have ratified the agreement, out of 54 that have signed.
Only one country is yet to sign the agreement.
Out of the 54 countries which have already signed, 47 have ratified it, which confirms that they are legally ready to start implementing their commitment. Out of those 47, 35 of them are already facilitating trade.
In an exclusive interview, AfCFTA Director for Institutional and Programme Coordination Prudence Sebahizi said there are a number of trade facilitation measures that countries have put in place to facilitate trade under AfCFTA.
“Then once we have added value to most of the products, we will be able to trade at least at 50 percent in terms of intra-Africa trade. There is a huge potential to industrialise if we trade among ourselves, create jobs, and also increase the volume of trade and bridge the gap of trade balance deficit,” Sebahizi said.
The AfCFTA—the continent’s single biggest trading bloc—would create a market of more than 1.3 billion people and a combined gross domestic product of up to $3.4 trillion.
If fully implemented, the AfCFTA could leverage intra-African trade and increase trade among member states by up to 110 percent.
In addition, the AfCFTA could lift up to 30 million people out of extreme poverty and up to 68 million people out of moderate poverty.
According to Sebahizi, beyond creating a market for African countries, AfCFTA would also contribute towards growth and development of the economies.
“This then demystifies the misconception that there is fear of competition. The AfCFTA is not just about access to the market, AfCFTA is a developmental project. You couple access to the market with an industrialisation programme.
“These small countries will take advantage of the bigger market to integrate into the regional value chain. If a small country cannot produce a product on its own, at least they can produce part of that product to feed into the whole value chain,” he said.
In an earlier interview, Chief Executive Officer for African Union Development Agency- Nepad—the African Union’s arm mandated to coordinate and execute priority regional and continental projects to promote regional integration— Nardos Bekele-Thomas said in 2023 alone, intra-Africa exports increased to 16 percent.
She said as a feeder into the continent’s trade and commerce drive, industrialisation remains essential.
“We need broad-based growth. That is why industrilisation is critical and very important. We need to do manufacturing and to industrialise.
“That is where the whole aspect of the value chain or the supply chain we are talking about; identifying the growth pillars and making sure that this supply chain and value chain are not only at national level, but also at regional level but also at continental level,” Bekele-Thomas said.
