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Africa is Paving its Path To Fortune By Breaking Trade Barriers with CFTA

Never before has the desire for African integration been backed by concrete
actions than in the last couple of years. We have, of recent, seen growing
interest from African leaders who now realise that trade – not aid – is the key
to achieving significant economic development.

Without doubt, African countries will need to do more business with one
another in order to develop. Almost all countries that have risen in the 21st
century attribute the indispensability of trade as the key to their success.

The abundance of wealth in Africa is common knowledge. The continent has
about 30 per cent of the world’s remaining mineral resources. And, looking at
the size as well as the composition of the population, the potential knows no
bounds.

Africa too can be a global trading heavyweight. And with some of the
wealthier economies charting isolationist paths, the continent as a bloc should
proactively take up its rightful place as a global trade giant.

To achieve that, however, African countries must first look inward, shake
off the myopic need for egoistic and short-term wins for more impactful
development, especially for the young who constitute almost 70 per cent of the
population.

This is why the Continental Free Trade Area (CFTA) is arguably the biggest
venture that will transform Africa.

Next month, African leaders are scheduled to converge in Kigali to sign the
agreement establishing the free trade area. This is the climax to a long
journey that picked momentum when negotiations for the agreement started in
2015.

If implemented successfully, the CFTA would become the largest free trade
area in the world in terms of membership. With 55-member countries forming a
single market with a GDP of over US$3 billion, Africa will be a trading force
to reckon with.

More importantly, implementing the CFTA will inject intra-continental trade
with the much-needed boost. At the moment, trade between African countries is
estimated at just 14 per cent, but with the CFTA, this is expected to double,
with the United Nations Economic Commission for Africa putting estimates at
USD$ 35 billion up from only 14 billion.

While opening the Heads of State summit in Addis early this year, the AU
chair, President Paul Kagame, spoke about how scale is important and the
urgency required if Africa is to catch up.
“We are running out of time, and we must act now to save Africa from
permanent deprivation,” he said adding, “We must create a single continental
market, integrate our infrastructure, and infuse our economies with
technology.”

“No country or region can manage on its own. We have to be functional, and
we have to stay together,” Kagame pointed out.

Indeed, disunity has been Africa’s greatest shortcoming. The risk of not being
together on this front will be costly for the success of the CFTA – missing out
on yet another opportunity for Africa to create wealth and better living
standards for Africans.

In the last couple of years, we have seen progress in African countries working
together. Today, more than ever, people are moving freely across borders,
restrictions that have hindered air travel are slowly eroding and regional
trade blocs have tasted the benefit of working together, increasing the
appetite for scaling up.

It is unfortunate that the craving for intra-regional trade is at a time
when skepticism towards trade liberalisation is growing.

However, by responding to the needs of people in an inclusive way and
ensuring equitable distribution of benefits, the CFTA journey will be less
daunting. Not to mention the valuable lessons learned from the experiences of
regional economic communities across the continent.

Whether it’s from Abuja to Addis, Cairo to Cape Town or Mali to Malawi, all
African nations can advance by eliminating barriers to the free movement of
goods and capital.

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