New dawn in Africa as World’s largest free trade agreement(AfCTA) Ratified
The Chairperson of the AUC Commission Moussa Faki Mahamat, flanked by the African Union Commissioner for Trade and Industry, His Excellency Albert Muchanga received two AfCTA Ratified document
The commonly known (AfCTA) African Continental Free Trade Area (AfCFTA) has come into force today Thursday. It will be the largest free trade agreement by population that the world has seen since the 1995 creation of the World Trade Organization.
The implmention of this agreement required only 22 Africa member states to ratify and as at Tuesday the 28th that number was achived, the Egyptian Foreign Ministry said over the weekend that the required 22 ratifications have been received.
Its confirmed to us through AU official twitter account that the latest two ratifications came from, Sierra Leone and the Sahrawi Republics were received by the African Union (AU) on April 29. Its only three Countries (Benin, Eritrea and Nigeria) of Africa’s 55 countries that did not sign up to the deal.
Office of the UN said if only Nigeria joins the AfCFTA then intra-African trade could grow by more than 50 percent in the next five years. however, going by the statistics this doesn’t really hold water as key indicators point other emerging economies that may soon in acouple of year overtake Nigeria and South Africa as fastest growing economies in Africa, like Morocco and Egypt and they easily fill that void.
The Africa Union and the UNDP statistics, cited by Egyptian ministry, when the agreement enters into force it will likely affect more than 1.2 billion people, with a total domestic product of about $3.4 trillion. It will cut duties on 90 percent of goods on the continent. Ths deal is likely to boost intra-African trade by 52.3 percent, the UN office added.
With regards to the infrastructure developments, Africa development Bank website resources indicates the continent needs $130 billion to $170 billion in infrastructure financing per year, and there’s a shortfall of $68 billion to $108 billion.
On the other hand Rwandan President Paul Kagame hailed it as a “new chapter in African unity.”while the African Union’s trade commissioner Albert Muchanga told Fortune News: “When you look at the African economies right now, their basic problem is fragmentation.”
“They’re very small economies in relation to the rest of the world. Investors find it very difficult to come up with large-scale investments in those small markets,” he said, adding: “We’re moving away from fragmentation, to attract long-term and large-scale investment.”
The AfCFTA is seen aflagship project of the African Union’s “Agenda 2063” development vision for five years. The AfCFTA proposal was approved in 2012 and the members started working on a draft in 2015. In March 2018, the leaders of 44 African countries endorsed the agreement in Rwanda.
The AfCFTA participants are also weighing of the possibility of using a common currency like the Euro used by the European union member states.
Whats the Impact of Nigeria being out?
Nigeria remains the biggest absentee in the new trade area—and a large one, it accounts for a sixth of Africa’s GDP. but then again his growing to be the largest Africa Economy has come with pride and ego.It originally pulled out of talks because, as per President Muhammadu Buhari, the agreement could “undermine local manufacturers and entrepreneurs, or… lead to Nigeria becoming a dumping ground for finished goods.”
The pioneer of United Africa former Libyan Leader Muamar Gaddafi who had envisioned this did not live to see it implementation, though we salute him for this.