The Continental Free Trade Area (CFTA), Africa’s signature policy reform of 2018, is predicted to unleash Africa’s full potential through its wider integrated market wherein more African countries will trade with each other, according to Economic Commission for Africa‘s (ECA) Executive Secretary, Vera Songwe.
Speaking at the 5th Annual Ministerial Symposium at the 2018 Mining Indaba, Songwe stated that the mining sector would greatly benefit from the CFTA. Furthermore, numerous African economies will be transformed through the CFTA. According to legal texts and policy documents, the main objectives of the CFTA are “to create a single continental market for goods and services, with free movement of business persons and investments, and thus pave the way for accelerating the establishment of the Customs Union. It will also expand intra-African trade through better harmonization and coordination of trade liberalization and facilitation and instruments across the RECs and across Africa in general. The CFTA is also expected to enhance competitiveness at the industry and enterprise level through exploitation of opportunities for scale production, continental market access and better reallocation of resources.” 44 African countries have signed the agreement.
“The CFTA is a singular policy move that will actually help your business, help the continent create more jobs and ensure that we create enough value on the continent and increase intra-African trade,” Songwe said in her address. “When African countries trade with African countries more value is created and therefore we believe we can do more than that with the CFTA.”
The CFTA will also contribute to job creation. Songwe explains, “If you became part of that process of transformation, of creating value chains on the continent, we would do a lot more and create a lot more jobs on the continent. This is really the purpose of the CFTA, to see if we can create a wider integrated market – which will have 1,5 billion people by 2030 with a potential GDP of $2,2 trillion dollars.”
It is estimated that if all 54 African countries sign the agreement, and the deal is ratified by all states, it will make Africa the largest single market in the world.
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