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B&R News: AfCFTA, a pan-African free trade zone
28 Mar 2018

 

 

African Heads of States and Governments pose during African Union Summit for the agreement to establish the African Continental Free Trade Area in Kigali, Rwanda, on March 21, 2018.

 

The emerging global trade and investment architecture presents a window of opportunity for African countries to transform their economies, achieve rapid growth and create jobs for their burgeoning youth population. This will be shaped by the new African Continental Free Trade Area (AfCFTA) and China’s Belt and Road Initiative (BRI).

 

The pan-African free trade zone envisages free movement of goods, services and people. Eliminating trade and investment barriers could expand trade and exchange opportunities for Africa's 1.2 billion people and substantially increase its $2.5 trillion (Sh250 trillion) output.

 

China, being Africa's largest trading partner, is a key factor and beneficiary of the continent's development. A million of its citizens and 800 corporations work in Africa.

 

While deepening trade and investment among themselves, African countries need to embrace the belt and road initiative, under which China plans to invest trillions of dollars for a new ‘Silk Road’ linking it to Europe and Africa. The BRI, said to be Chinese President Xi Jinping's most ambitious foreign policy initiative, involves massive infrastructure investments across Europe and upgrading of maritime routes connecting China with Asia and Africa. The potential benefits are enormous.

 

African governments need transformative policies to improve the readiness of their economies to actively participate in the AfCFTA and reap benefits from China's trade and investment initiative. That involves a lot of policy and operational changes, the most important one being for Africa to change from a principal exporter of cheap raw commodities to a significant exporter of manufactured goods and value-added services.

 

Source: Daily Nation