Intra-African Connect, an organization committed to promoting and enabling Intra-African Trade and investment has lauded the signing of the African Continental Free Trade Agreement.
The organization’s founder Mr. Nana Yao Lee was part of a group of private sector stakeholders that were taking part in the African Union Business Forum, held on the 20th of March 2018, a day before the monumental signing of the agreement, by African heads of states – in Kigali Rwanda.
Private sector players from across the continent met at the Kigali Convention Centre and engaged Heads of states, the African Union and policy makers – on matters that would make the African Continental Free Trade Agreement reality.
According to Mr. Lee, a simple analysis of the ratios of Gross National Income against Gross Domestic product will show that African countries are not trading with themselves, hence not generating adequate domestic income / product. Comparing the GNI and GDP shows whether a nation’s resources are put to capital creation or declining toward abroad.
Unfortunately most African Nations and their governments are engaged in a negative sum game, evident by our huge budget deficits, borrowing, and industrial development lag.
Contributing to discussions at the Forum, he pointed out that Africa needs a paradigm shift in its view of African economics. Africa’s economic principle should be ‘Abundance and Management’ as opposed to ‘Scarcity and Choice’. Africa enjoys an abundance of resources and people.
The African Continental Free Trade Area will create a trade bloc of 1.2 billion people with a combined GDP of more than $2 trillion. It commits countries to removing tariffs on 90% of goods and to liberalize services. “It is time to put our heads together and leverage on what one African country can offer the other, and how we can effectively manage what we have within the continent.” he demanded.
Intra-Africa Connect through its Trade events like the Kenya Trade Expo in Ghana, has identified challenges to Intra-Africa Trade such as free movement of goods and people, a vacuum in logistics structures to enable intra-African trade, as well as lack of access to trade financing.
During the Business forum, Dr. James Mwangi, CEO and Founder of Equity Bank proposed the convertibility of our African currencies, optimally a single currency. Further to that, a mobile switch to consolidate banks, E-commerce, and mobile money within the African Continental Free Trade Area.
A challenge was also put to the continent to embrace the digital market space. Dr. Mukhisa Kituyi, Secretary-General of the United Nations Conference on Trade and Development insisted that, “We need to have access to underpin a digital Economy. Build a trust economy, not just infrastructure. A partnership between government and private sector. An African digital wallet which holds together our currencies.”
AU Commission Chair Moussa Faki Mahamat demanded that women need be at the decision making table adding that there is need to sensitize and educate men, as regards women’s empowerment and equality. He also stressed the need for their financial inclusion; to be able to sell, to be able to purchase, and to be able to Invest.
Another critical success factor in making this African Continental Free Trade Area a success, emerged as the need to recognize entrepreneurs from the informal sector. “They actually make up majority of the people that drive African economies.” Asserted Mr. Strive Masiyiwa, a London-based Zimbabwean businessman, entrepreneur, and philanthropist.
On the part of the heads of state, AU Chairperson and President of Rwanda Paul Kagame urged the private sector to move African discourse from a focus on problems, to a focus on solutions while President Cyril Ramaphosa of South Africa, insisted that we cannot have a Free Trade Area, without the free movement of people. President Ramaphosa also proposed creating a single homogeneous currency for African countries in a bid to attract infrastructure investment and enable ease of intra-African trade.
Former President of Nigeria, H.E Olusegun Obasanjo stressed on the need to educate African Leadership on the AfCTA and thus creating a critical mass for the support and push of African Development.
A day after the Business Forum, 44 countries signed onto the African Continental Free Trade Area Agreement. Private Sector organizations such as Intra-Africa Connect have already been working hard at promoting and increasing Intra-Africa Trade.
The agreement is a welcome addition to the work being done. However, the key to its success lies in the commitment of the signee countries, to implement what is outlined in the agreement.