Led by the African Union Commission and under the chairmanship of Rwandan president Paul Kagame, forty-four African countries signed up to the biggest trading bloc on the African continent.
The African Continental Free Trade Area (AfCFTA) is one of the biggest free trade bloc in the world, maybe only behind the World Trade Organization (WTO).
The signing of the AfCFTA by heads of governments and or their representatives is only a step in chasing an ambitious dream of uniting Africa at the level of commerce.
Experts and watchers say, the real work is yet to take off, all things being equal. The fact that after all this while, some countries decided to hold on to ratification is not as much a setback but speaks to the challenges that lay ahead.
Africa Sahara presents some key facts about the historic trade pact
1. The AfCFTA was signed in Kigali, Rwanda under the theme: ‘Creating one African Market.’
2. If all nations come on board, it will bring together 1.2 billion people
3. The estimated combine Gross Domestic Product (GDP) of the pact is over $2.5 trillion
4. In terms of participating countries, it will be world’s largest free trading bloc, second round of negotiating is expected in December 2018
5. It is part of the bigger Agenda 2063 being championed by the African Union (A.U.)
6. The AfCFTA is expected to progressively eliminate tariffs on intra-African trade
According to the U.N. Economic Commission for Africa, AfCFTA can boost intra-Africa trade by 53.2%
7. Africa’s industrial exports stand to benefit the most from the pact
8. The AfCFTA also aims to harmonize the efforts of sub-regional trading bloc and also consolidate gains
9. It aims at empowering especially small and medium-sized enterprises (SMEs) who form around 80% of the region’s businesses.
10. SMEs through the AfCFTA will have capacity to supply inputs to larger regional companies who will in turn deal with overseas export.
11. Intra-continental trade in Africa is around 16% as against 51% for Asia and 70% for Europe, the pact aims to change that narrative.
12. Some of the main hurdles are: local business laws, security and poor infrastructure.