AFRICA NEWS AGENCY
Analysis
AFCFTA: THE JOURNEY HAS JUST STARTED ... Since January 1, Africa has become the largest market in the world with the entry into force of the AfCFTA. It now remains for each country to adapt its modalities. And above all to support African entrepreneurs on their way to this common market so that they can seize all the opportunities. This is where the battle begins! By Dounia Ben Mohamed
«While the start of trading represented a milestone for the people, member States should ensure the creation of a conducive environment for the continent’s young people and women to benefit from the opportunities presented by the agreement.” With these words, South African President Cyril Ramaphosa, then current Chair of the African Union, officially and virtually launched the AfCFTA on January 2. At the same time, he summarized all the issues at stake. For if the opportunities offered by this new common market, now the largest in the world, are infinite, they will only really benefit Africa...if Africans seize them (read opinion editorial from Anne-Elvire Esmel).
And the challenges, in this regard, are still significant. Even though the official launch of the AfCFTA, originally scheduled for July 2020 but postponed to January 1, 2021 due to the COVID-19 pandemic, marks an important step in the advancement of African economic integration. According to the United Nations Economic Commission for Africa (UNECA), with a potential market of 1.2 billion consumers today, with an estimated GDP of $2.5 trillion, and nearly 2.5 billion by 2050, it is the largest trading area in the world. «If properly implemented, the AfCFTA will be the framework that will fos-
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ter investment, rapid innovation and ultimately growth and prosperity for Africa,» said Vera Songwe, Executive Secretary of the United Nations Economic Commission for Africa (ECA), one of the institutions that has supported the process alongside the African Union, at the launch. According to her forecasts, the market should «boost intra-African trade by 52.3%» by eliminating tariff barriers. While for the time being, intraAfrican exports accounted for 16.6% of total exports in 2019, against 68.1% for intra-European exports, 59.4% for intra-Asian exports, 55% for intra-American exports and 7% for intra-oceanic exports, she noted.
to the continental market. This intraAfrican trade is expected to increase the incomes of nearly 68 million more people living on less than $5.50 a day (€4.53) by 2035 and to promote greater wage growth for women (+10.5%) than for men (+9, 9%)_ while increasing the GDP of African states from 0.35% of GDP to 0.54% by 2040, «depending on the ambition of the reform», says a joint report produced by the United Nations Development Programme (UNDP) and the AfCFTA Secretariat.
More than just a trade agreement, «an instrument for Africa’s development »
The COVID-19 pandemic would have resulted in up to $79 billion in production losses in Africa in 2020. It has also revealed, once again, the great fragility of the continent in the face of exogenous shocks, and the dependence of African countries in terms of imports, particularly of medicines (more than 70% of its needs). However, by developing the industrialization of the continent and encouraging local manufacturing, primarily in the pharmaceutical industry, the AfCFTA reveals its full interest in the current context.
Far from being «a simple trade agreement,» for Wamkele Mene, Secretary General of the AfCFTA Secretariat, it is «an instrument for Africa’s development. According to the World Bank, it could help lift up to 30 million Africans out of extreme poverty. As, in fact, increased intra-African trade will encourage industrialization and thus local production - because it is these ‘made in Africa’ products and goods meeting the rules of origin that will benefit from this privileged access
A tool to speed up the fight against COVID-19 and accelerate economic recovery
«The successful implementation of the AfCFTA would help cushion the
