Online, Graphic Business, August 24, 2023
Governments of Africa have been urged to work towards the removal of existing trade barriers to unlock the full potential of the African Continental Free Trade Area (AfCFTA).
The Board Chairman of CUTS International, Accra, Justice Jones Dotse, who made the call said the world is moving towards common markets and free trade agreements and it is through these trade agreements that Africa can increase consumer and producer surpluses.
“Most of you who have travelled to Europe, for example, will know that the trade barriers that exist in Africa do not exist over there and we need to break down those barriers to make the harmonisation of these protocols of AfCFTA very successful,” he said.
Justice Doste made the call at CUTS/GIZ public private dialogue to mark CUTS International’s 40th anniversary in Accra on the theme: Building Momentum Towards AfCFTA Implementation: Overcoming Challenges.”
An UNCTAD report estimates that addressing Non-Tariff Barriers (NTBs) like these across Africa can bring gains of $20 billion each year to AfCFTA member states/state parties. This is three to four times more than the gains expected from eliminating intra-African tariffs.
The International Monetary Fund (IMF), in its recent report titled, “Trade Integration in Africa: Unleashing the continent’s potential in a changing world”, said the removal of trade barriers among African countries will help lift 50 million people out of poverty, adding that it would also increase to the rest of the world by 15 per cent. Last year, the World Bank also reported that over the past 40 years, the number of people in China with incomes below $1.90 per day – the International Poverty Line as defined by the World Bank to track global extreme poverty– has fallen by close to 800 million.
At China’s current national poverty line, the number of poor fell by 770 million over the same period.
Potential Justice Doste indicated that Africa had a modest expectation on AfCFTA numbers and it was believed that the AfCFTA had the potential to lift 30 million people out of extreme poverty and create a combined gross domestic product (GDP) valued at US$3.4 trillion.
He said, “all the lofty and brilliant expectations of AfCFTA will not roll on the wheels of inevitability.
There will be some head-wings.” “Inequalities among member states could dampen some member states’ commitment to the ideals of Pan African integration.
Member states must build momentum towards AfCFTA implementation in order to overcome challenges. Rome was not built in a day but through consistency and hard work, the Romans managed to build a gigantic Roman which depicts its history, culture, economic and industrial power. It is now our turn and we can do the same for Africa,” he stated.
Restructuring Africa’s economy
The Secretary-General of the AfCFTA, Wamkele Mene said, “the establishment of the AfCFTA does not only promote continental trade and economic integration in Africa but also supports economic integration and trade facilitation between Africa and the rest of the world as the objective of the agreement is to increase both intra-African trade and trade with the rest of the world in made in Africa goods and services.” He said the global economic challenges such as geopolitical tensions, inflationary pressures, supply chain disruptions, anti-globalisation sentiments, Covid and the Russia-Ukraine conflict has affected the trading system globally.
Therefore, he said there was the need to accelerate the implementation of AfCFTA to help African economies to build resilience and become competitive regionally and globally. He added that the AfCFTA presented an unparalleled opportunity to restructure Africa’s economies away from the economic models based on the export of natural resources to countries such as Europe, Asia and North America and import manufactured goods.
For his part, the West African Regional Director CUTS International, Appiah Kusi Adomako, said “with our rich legacy and forward-looking vision, CUTS International stands poised to navigate the evolving landscape of global trade, driving prosperity for all.”
The Lead Technical Advisor for GIZ Trade Hub, James Hammond, reiterated the commitment of the GIZ support programme to supporting the implementation of the AfCFTA. He said since 2021, his outfit had rolled out a number of technical assistance and capacity building programmes to enhance the readiness and preparedness of the country to effectively take advantage of the opportunities presented by the AfCFTA. “We will continue to work with Civil Society Organisations (CSOs) such as CUTS International to give further boost to the progress already achieved to realise the full benefits of the AfCFTA,” he added.