By Phumla Williams
The dream and vision of the founding fathers of the OAU, now known as the African Union was for a united and prosperous continent, which benefitted all her people. Today, those dreams are a step closer to reality with the advent of the African Continental Free Trade Area (AfCFTA), which creates a single continental market for goods and services in Africa.
It responds to the aspirations of Agenda 2063, which is underpinned by the AU’s vision to build an integrated, prosperous and peaceful Africa that is a dynamic force in the international arena.
AfCFTA is one of the flagship projects of the African Union’s Agenda 2063, and it will help the continent to address challenges of youth unemployment, skills development, industrialisation, women empowerment and infrastructure development.
It will create a single super market for goods and services, which will strengthen trade and inter-African investment.
When President Cyril Ramaphosa signed the Kigali Declaration in March 2018, he reaffirmed South Africa’s commitment to sign the AfCFTA Agreement once South Africa’s legal and constitutional processes have been completed. True to this commitment, South Africa deposited its instrument of the AfCFTA Ratification Agreement on the 10 February 2019. The African Continental Free Trade Area was officially launched at the 12th Extraordinary Summit of the African Union (AU) in Niamey, Niger on 7 July 2019.Nigeria and Benin became the latest two nations to sign the AfCFTA agreement at the summit, which has now been signed by 54 countries on the continent. The agreement has now also been ratified by 27 countries.
The three biggest economies in Africa in Nigeria, South Africa and Egypt have also added their combined economic might to AfCFTA. According to the International Monetary Fund’s (IMF) latest World Economic Outlook report, the combined GDP of Africa’s three largest economies in 2017 amounted to over $960 billion.
When the economic might of the entire continent is combined, the AfCFTA brings together 54 African countries with a combined gross domestic product of more than $3.4 trillion. This is truly a massive market with staggering untapped potential.
The African Continental Free Trade Area agreement will create opportunities and benefits for all the nations of the continent. It will enable companies to expand their markets by exporting goods and services across the continent.
It will contribute to the growth and diversification of our economy and therefore create jobs, as well as reduce inequality and unemployment. The agreement will also reduce tariffs and benefit entrepreneurs, including medium to small businesses.
The African Free Trade Area paves the way for our nations to benefit from inter-regional trade within the African continent. It is also an opportunity for entrepreneurs from African countries to start working together in a trade tariff free environment.
It will help to reduce trading challenges such as different regulations from one African country to another, and it brings us closer to the establishment of a common continental customs union for international trading.
By facilitating the movement of goods and services among African countries, AfCFTA will create opportunities to accelerate intra-Africa trade, grow local businesses, create jobs and increase infrastructure development on the continent.
The free trade agreement has the potential to be a game changer for the continent on all levels. It will act as a catalyst for economic growth and will benefit entrepreneurs, including medium to small businesses.
It is in the interest of all who live on our continent that we grow the African economy by creating jobs, providing basic services and ensuring equal access to opportunities. To do this we must encourage a spirit of entrepreneurship and ensure more people take up opportunities created by a single market of goods and services for 1.2 billion people.
The AfCFTA presents perhaps the greatest opportunity for Africa to fulfil its aspiration of a united, integrated and prosperous continent. It is the dream of our founding fathers come to life and will contribute towards the eradication of poverty, unemployment and inequality.
Miss Phumla Williams is the Acting Director General of South Africa’s Government Communication and Information System (GCIS) and the Cabinet Spokesperson.