West African Free Trade Agreement

The perimeter of the AfCFTA is important. The agreement will reduce tariffs between Member States and cover policy areas such as trade facilitation and services, as well as regulatory measures such as hygiene standards and technical barriers to trade. Full implementation of AfCFTA would transform markets and economies across the region and boost production in the services, manufacturing and raw materials sectors. Guillermo Arenas is an economist in the Department of Trade and Regional Integration (ETIRI) at the World Bank. His area of expertise covers various aspects of the international economy and public order, including trade policy, export competitiveness and impact analysis. The African Continental Free Trade Area only came into force when 22 of the signatory countries ratified the agreement, which took place in April 2019, when The Gambia was the 22nd country to ratify it. [67] In August 2020, there are 54 signatories, of which at least 30 have ratified and 28 have tabled their ratification instruments. [69] [70] [71] The three countries that have ratified their ratifications but have not yet tabled are Cameroon, Angola and Somalia,[71] although Morocco is also ratified. [73] [74] Unveiling of the afCFTA Trade in Goods online portal, on which Member States exchange commercial information and download their tariff offers covering 90% of tariff positions. The AU says the African Continental Free Trade Area, called AfCFTA, will create the world`s largest free trade area. South Africa, Sierra Leone, Namibia, Lesotho and Burundi have since signed afCFTA at the 31st African Union Summit in Nouakchott. [50] Since July 2019, 54 states have signed the agreement.

[51] You will also be rid of quotas, so there is no limit to the amount of trade you can make. The Continental Free Trade Area (AfCFTA) agreement will create the largest free trade area in the world in terms of the number of participating countries. The pact connects 1.3 billion people in 55 countries for a total gross domestic product (GDP) of $3.4 trillion. It has the potential to lift 30 million people out of extreme poverty, but achieving its full potential will depend on the introduction of meaningful political reforms and trade facilitation. Although Africa`s average growth is 3.6% in 2019/20 and the world`s fastest growing economies are on the continent, much remains to be done. Africa remains highly dependent on exports of raw materials and agricultural products, while it imports mainly capital goods or food products from abroad. With less than 3% of world trade, it is not yet necessary to achieve export diversification, as many African countries still depend on the rents of extractive exports, while they lag behind in industrialization efforts. In this context, intra-African trade remains below its potential and accounts for about 17% of total African trade volume in 2017. In contrast, intracontinental trade in North America accounts for 51 per cent of exports, 49 per cent in Asia and 22 per cent in Latin America, while this figure is 69 per cent in European countries. Although some regional economic communities (REC) have improved trade integration through tariff reductions, the African market remains fragmented. Non-tariff barriers, such as uncoordinated bureaucratic procedures, long border wait times or long and heavy export requirements, increase trade costs on the continent.

As a result, Africa has integrated more quickly into the rest of the world than with itself. After the Kigali summit, more signatures were added for the AfCFTA. At the African Union summit in Nouakchott on 1 July 2018, five other nations, including South Africa, joined the agreement. Kenya and Ghana were the first nations to ratify the agreement and file their ratifications on 10 May 2018. [2] Of the signatories, 22 had to ratify the agreement in order for it to enter into force, and it happened on 29 April 2019, when Sierra Leone and the Arab Democratic Republic of the Sahara ratified the

Comments are closed.