Hey there! Have you ever wondered how Africa is boosting its economy? Let’s chat about the African Continental Free Trade Area (AfCFTA), a game-changer in intra-African trade that is creating a win-win situation for all member states. Let’s dive in!
What is the African Continental Free Trade Area (AfCFTA)?
AfCFTA agreement is a massive free trade agreement established in 2018, covering 54 out of 55 African Union countries. It’s the world’s largest free trade area since the World Trade Organization’s creation!
After that, other AU countries agreed and the official trade began. The African Continental Free Trade Area (AfCTFA) will provide opportunities and boost the economy in Africa. The international community is expecting sustainable growth and economic development by facilitating this intra-African import/export area.
This agreement is set to reshape African economies by creating a single market for goods and services. It’s not just about trade; it’s about showing the world that Africa is a leader in global commerce.
Objectives and benefits of (AfCFTA)?
The African Continental Free Trade Area (AfCTFA) will provide possibilities and strengthen the economy in Africa. The international community expects sustainable growth and economic development by facilitating this intra-African trade area.
The Objectives and Benefits of The African Continental Free Trade Area (AfCTFA):
- Consolidate the trade market: Create a single African market for goods and services.
- Strengthen the economy: Boost sustainable growth and development.
- Structure and Implementation: AfCFTA decisions are made by a simple majority vote, with oversight from the AU Assembly and implementation by the Senior Trade Officers Committee and Secretariat.
- Dispute Settlement: It offers a dispute resolution mechanism for state parties, with mediated consultations available for conflict resolution.
- Traders Security: Reduced tariffs aim to formalize trade, enhancing safety and affordability for women involved in cross-border trade.
- Developing SMEs: Eliminating import duties benefits small and medium-sized enterprises by improving market access and trade opportunities.
- Promoting Industrialization: It aims to grow Africa’s manufacturing sector to $1 trillion by 2025, creating 14 million jobs and boosting competitiveness.
- Sustainable Development: AfCFTA supports UN 2030 Agenda goals by promoting economic growth, and industry, and reducing reliance on external resources.
Benefits of AfCFTA for Traders and SMEs
The AfCFTA agreement aims to protect women traders (70% of informal cross-border traders) and open regional markets for SMEs (80% of businesses).
Need help navigating AfCFTA? Fill out the form below to contact IOR Africa for trade compliance and customs support.
FAQs
How AfCFTA Works?
AfCFTA institutions make decisions by simple majority. The AU Assembly oversees, while the Ministerial Council reports to it. A Senior Trade Officers Committee implements decisions. An independent Secretariat handles specific roles.
what is AfCFTA's Impact on African Trade?
UNECA predicts AfCFTA will boost intra-African trade by 52.3% after removing trade barriers. It’ll cover a $2.5 trillion GDP market, promoting more industrial goods over extractives. Currently, 75% of Africa’s external exports are extractives, compared to 40% for intra-African trade.
How AfCFTA Boosts Industry and Development?
AfCFTA could double Africa’s manufacturing sector to $1 trillion by 2025, creating 14 million jobs. It also supports UN Sustainable Development Goals, promoting economic growth and reducing external dependence.
Ready to learn more about AfCFTA’s potential for your business? Fill out the form below for a personalized consultation. Let’s explore how this trade revolution can benefit you!
AfCFTA aims to boost intra-African trade, which was only 16.6% in 2017 compared to 68.6% in Europe and 59% in Asia. It will create a unified market for goods and services.