AfCFTA expected to increase intra-Africa trade by 60 percent
Leonard Ncube, Victoria Falls Reporter
ZIMBABWE’s private sector and its regional peers have been called upon to take advantage of the African Continental Free Trade Area (AfCFTA) to increase intra-Africa trade.
The historic free trade deal is expected to take effect from July this year and is expected to increase intra-Africa trade by 60 percent. At the moment intra-Africa trade is said to be a mere 17 percent but has potential to become the single largest market in the world.
One of the resolutions of the Sixth session of the Africa Regional Forum on Sustainable Development (AFRFSD), which ended in Victoria Falls last Thursday, was a call on the continent to take advantage of the trade initiative to transform the regional economy.
Improved intra-Africa trade is key in attainment of Sustainable Development Goals (SGDs) by 2030 and Africa’s Agenda 2063.
Member states were also asked to establish effective public-private partnerships and also create enterprises to help in project implementation.
During the gathering, a senior United Nations official and executive secretary of the Economic Commission for Africa (UNECA), Ms Vera Songwe, challenged the continent to learn from China.
She said the Asian country whose economy has been fast growing in the past decades, developed because it exported a lot.
She said Africa needs about $360 billion every year to finance different economic gaps and can learn from China how to mobilise resources.
“African countries are financing their own growth and development. China managed to develop because they exported a lot and had financial base, which Africa doesn’t have.
“We need to learn from China who developed through trade than to depend on pension funds, taxation and use of collateral on investment,” said Ms Songwe.
She implored African governments to manage their resources very well as some of them can attract investment.
“Let’s trade among ourselves. For now intra-Africa trade is only about 17 percent yet if we trade in the region we can grow our economies because every country has its different exportable things,” said Ms Songwe.
She said countries should also push for trans-border partnerships. The creation of the AfCFTA had been on the cards for close to two decades and its purpose is to progressively phase out duty on 97 percent of goods traded between African countries and steer regional development.
According to the African Union, the AfCFTA would bring together Africa’s 1,2 billion people and create the world’s largest trading bloc. This is envisaged to increase intra-African trade by 60 percent by 2022.
Skeptics, however, fear that cheaper imports will hit small manufacturers and farming families. — @ncubeleon