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African Continental Free Trade Agreement South Africa

In 1963, the Organization of African Unity (OAU) was founded by the independent states of Africa. The aim of the OAU was to promote cooperation between African states. The 1980 Lagos Action Plan was adopted by the organization. The plan proposed that Africa minimize its dependence on the West by encouraging intra-African trade. It began with the creation of a number of regional cooperation organizations in different parts of Africa, such as the Conference on the Coordination of Southern African Development. Finally, in 1991, this led to the Abuja Treaty, which founded the African Economic Community, an organization that encouraged the development of free trade zones, customs union, an African Central Bank and a common African monetary union. [21] [22] Agenda 2063 aims to bring Africa together in a variety of ways. However, at an AU summit in Niger, the focus will be on a free trade agreement, with little time for other issues. 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. Given that AfCFTA could significantly mitigate the economic consequences of COVID-19 – particularly if the situation worsens – heads of state and government should accelerate rather than delay their implementation; they should also involve all economic actors in setting priorities for trade facilitation reforms and enable the agreement to be implemented quickly and ambitiously.

At the sectoral level, accelerating the introduction and export through the creation of greenways is a priority for the medicine, pharmacy and food sectors and is a strategy to rebuild better with a strong focus on regional value chains resistant to climate and green change. Nigeria was one of the last nations to sign the agreement. With a population of 200 million, Nigeria is the most populous country in Africa and has about 98 million inhabitants in the most populous countries, Ethiopia and Egypt. With a nominal GDP of $376 billion, or about 17% of Africa`s GDP, it is just ahead of South Africa, which accounts for 16% of the African economy. Given that Nigeria is such an important country in terms of population and economy, its absence at the first signing of the agreement was particularly striking. South African President Cyril Ramaphosa highlighted this in his comments of 12 July 2018, commenting: “The continent awaits Nigeria and South Africa. Through trade between us, we are able to maintain more resources on the continent. South Africa signed the agreement later. [52] At a time of economic and social problems caused by COVID-19, AfCFTA has been touted as a continental return strategy and as an opportunity for Africa to reposition itself on a global stage. The formation of new markets, forecasts of increased employment, product diversification and the stimulation of industrialization trajectories are part of AfCFTA`s vision, as Africa`s economic integration is underway. The launch of the African Continental Free Trade Area (AfCFTA) has been postponed due to coronavirus. Experts believe that the pandemic could help boost the ambitious free trade project.

Israel Osorio Rodarte is an economist in the Department of Trade and Regional Integration at the World Bank.