AfCFTA, Africa’s Greatest Source of Hope Regardless of Slow Progress

AfCFTA can surmount all challenges in 2024: The free trade initiative offers the biggest hope for Africa despite slow progress. The Africa Continental Free Trade Area (AfCFTA) offers the biggest hope for Africa to bring significant economic and social gains for the African people.

Although its implementation has been slow, AfCFTA when fully implemented will lead to higher incomes, lower poverty, and faster economic growth.

Additionally, fully implemented to harmonise investments and competition rules, the trade pact could boost regional incomes by as much as 9 per cent—to $571 billion, according to a new World Bank report.

It could also create almost 18 million more jobs, many of them higher-paying and better-quality jobs with women workers seeing the biggest gains. By 2035, the resulting jobs and income growth could help up to 50 million people exit extreme poverty.

The implementation of the trade agreement would further lead to larger wage gains for women and skilled workers.

Wages of female workers are expected to be 11.2 per cent higher in 2035 as compared to the wage level without the agreement, outpacing 9.8 per cent growth of male workers’ wages, according to experts.

As part of AfCFTA’s first phase, which took effect in January 2021, it would gradually eliminate tariffs on 90 per cent of goods and reduce barriers to trade in services, the Director of Trade in Goods and Competition at the AfCFTA Secretariat, Mohamed Ali told participants at a three-day ECOWAS regional multi-stakeholder forum on AfCFTA.

The MD for Development Policy and Partnerships World Bank, Mari Pangestu noted, “The AfCFTA comes at a critical time when regional cooperation is needed to navigate compounded risks and enhance the resilience of supply chains, to support green, resilient and inclusive growth in Africa”.

The participants at the forum held in Accra from 20-22nd November 2023 urged African countries to work together to make the AfCFTA a reality and reap its many benefits.

These benefits include reducing barriers to trade and investment, enhancing competition, and ensuring markets function fairly and efficiently through clear and predictable rules.

The participants which comprised private sector associations, civil society organisations, and officials of the AfCFTA Secretariat, among others, discussed ways to assess the benefits for a market of more than 1.4 billion people with a combined GDP of $3.6 trillion. Africa is rising, the potential under AfCFTA is limitless.