Africa’s Free-trade Agreement Needs Supporting Interventions

The economic benefits of the African Continental Free-Trade Agreement (AfCFTA), which is set to come into effect in July, will be substantial if non-tariff trade barriers are dismantled and member states align themselves towards common goals and philosophies. Signed in Rwanda in early 2018, the highly anticipated AfCFTA initiative establishes a single continental market that will allow for the free movement of businesspeople, goods and investments. It covers all 54 member states of the African Union – a market of 1.2-billion people with a combined gross domestic product (GDP) of about $2.5 trillion. The agreement initially requires member states to remove tariffs from 90% of goods. This will boost intra-African trade, which remains exceptionally low at less than 20% of total trade. That compares to 59% and 69% of intra-regional trade in Asia and Europe respectively, according to Brookings Institution.

SOURCE: AFRICA.COM