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The continent is a month old into the implementation of the Africa Continental Free Trade Agreement (AfCFTA).
Already, the single African market can boast of the finalization of some of the protocols, the operationalization of the bill as well as the live trade activities of some Ghanaian industries such as Kasapreko at the ports.
Speaking to Charles Ayitey on Business Live on Joy News, Founder and CEO for EBII Group, Adjoa Adjei-Twum, called for more easing of access to financial and other funding instruments for small scale industries to take advantage of.
“These small industries make 70 to 80% of businesses on the continent. They must be exposed to readily avenues streams of credit that will help them scale up and take advantage of this AfCFTA,” she stated.
Meanwhile, CEO of the Association of Ghana Industries, Seth Twum Akwaboah, has called on authorities in Ghana to deepen the creation of a conducive environment for local industries to thrive. He warns that any lag in this call will leave Ghana literally “selling her market” to other counterparts – “making us the losers.”
Even as the single market agreement has started, truly innovative approaches to meet financing needs are called for, beyond the routine method of securing loans from multilateral financial institutions. There’s been a proposal for the formation of a continental public-private partnership, in which African businesses that will profit from the expansion of trade under AfCFTA would be major financiers.
Not only are the vast majority of African businesses locally based small and medium-sized enterprises, but also there is a daunting lack of cost-effective infrastructure to get goods and services to market at competitive rates.
Industry players, notably the international commerce community, have insisted that education on the application of trade barriers under the agreement, as specified in AfCFTA’s Rules of Origin in the duty free trading area – which will determine the eligibility or otherwise of goods to be traded has not been done adequately enough to enable the trading community to be abreast with the relevant tenets of the impending agreement.
Although the implementation of some operational aspects of the African Continental Free Trade Area (AfCFTA) has been temporarily suspended, the agreement would be a very important element to support post-pandemic recovery and to foster economic growth in the medium term in sub-Saharan Africa through the creation of larger and more integrated markets and the promotion of intracontinental trade.
Importantly, implementation of the AfCFTA will also reduce uncertainty in trade relations within the continent, which together with an expanded and more integrated market—would foster both domestic and foreign direct investment and help boost economic activity as countries emerge from the pandemic.
The International Monetary Fund in its Staff Discussion Notes published on May 13 2020 projects that although the implementation of some operational aspects of the African Continental Free Trade Area (AfCFTA) has been temporarily suspended, the agreement would be a very important element to support post-pandemic recovery and to foster economic growth in the medium term in sub-Saharan Africa through the creation of larger and more integrated markets and the promotion of intracontinental trade.
Importantly, implementation of the AfCFTA will also reduce uncertainty in trade relations within the continent, which together with an expanded and more integrated market would foster both domestic and foreign direct investment and help boost economic activity as countries emerge from the pandemic.
For the Secretary-General of the AfCFTA, 2021 sets a new milestone in the economic history of Africa’s trade eco-space.
“Today, we are not only celebrating the start of a new year, but we give Africa a new beginning, with a a free trade area under the AfCFTA,” he stated.
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