54 African countries have today agreed to stay committed in the just launched African Continental Free Trade Area abbreviated as AfCFTA which had long been discussed as a means to advance business cooperation within the continent.
Today 1st January 2021, the member states through a virtual unanimously accepted the deal of a free trade across the entire continent in a meeting that was chaired by President Cyril Ramaphosaof the Republic of South Africa and current Chairperson of the African Union, Mahamadou Issoufou of Niger, Moussa Faki Mahamat the AU Champion of the AfCFTA and H.E. Wamkele Mene the Secretary-General of the AfCFTA just to name but these.
The African Union has issued a statement indicating that mechanisms have been put in place to follow up the successful implementation of this newly endorsed free trade policy across African continent through the start of a Trading Webinar.
According to the African Union, the decision of having a free trade agreement across African countries was motivated by statistics which indicated that African countries trade more often with far away countries than their fellow African brothers.
Thus the idea of reducing trade between African Countries and western countries or Asian was then activated under a decision to promote free trade amongst African countries.
The free trade would greatly help to protect African industries, increase economic productivity, and ensure the promotion and consumption of African products above all reduce the rate of over-dumping.
A recent report indicates that African countries trade 16– 18% with each other than they do with other countries from abroad.”The percentage of trade that African countries do with each other is a mere 16-18%. The bulk of the continent’s trade is with the rest of the world,” an excerpt of the report read.
The new free trade agreement amongst African countries would create more jobs across the continent and would enable some foriegn companies to move down to Africa and establish their business in order to enjoy free trade.
The free trade would also increase cooperation among African countries and would give them the ability to sign good trade deals with countries from abroad.
In 2018 in Kigali Rwanda, 30 African countries deposited their request to look into the agreement and ratify it and today a good number of African countries have decided to give a green light for the free trade agreement to become a reality.
This African Free Continental Free Trade area would cover over 1.2 billion people, with a combined GDP of $3 trillion and would be the biggest free trade area since the creation of the World Trade Organization.
It is expected that the income of about 68 million people would increase and would drive $292 billion of the $450 billion in potential income gains.
