The African Continental Free Trade Agreement (AfCFTA) is a historic trade agreement that aims to create a single, borderless market for goods and services across the African continent. The agreement, which was signed in March 2018 and came into effect on January 1, 2021, is expected to change the face of intra-African trade, boost economic growth, and promote sustainable development.
So, what are the objectives of the AfCFTA?
1. To promote economic integration and development
The AfCFTA seeks to promote economic integration and development in Africa by creating a single, borderless market for goods and services. The agreement aims to eliminate tariffs and non-tariff barriers to trade, simplify customs procedures, and harmonize regulations and standards across the continent.
2. To increase intra-African trade
The AfCFTA aims to increase intra-African trade by promoting the free movement of goods and services across the continent. This will help to boost trade between African countries and reduce reliance on external markets. It is estimated that intra-African trade could increase by 52% by 2022 as a result of the AfCFTA.
3. To promote industrialization and economic diversification
The AfCFTA seeks to promote industrialization and economic diversification in Africa by creating opportunities for businesses to expand their operations and increase their productivity. The agreement will help to promote the development of value chains and facilitate the transfer of technology and knowledge across the continent.
4. To create jobs and reduce poverty
The AfCFTA aims to create jobs and reduce poverty in Africa by promoting economic growth and development. The agreement will help to create new opportunities for businesses and promote the development of small and medium-sized enterprises (SMEs) across the continent. This is expected to create millions of new jobs and reduce poverty levels in Africa.
5. To promote regional integration and cooperation
The AfCFTA seeks to promote regional integration and cooperation in Africa by creating a framework for dialogue and cooperation between African countries. The agreement will promote the development of regional value chains and encourage the sharing of knowledge and best practices across the continent.
In conclusion, the African Continental Free Trade Agreement (AfCFTA) is a landmark agreement with far-reaching implications for the economic development of Africa. By promoting economic integration and development, increasing intra-African trade, promoting industrialization and economic diversification, creating jobs and reducing poverty, and promoting regional integration and cooperation, the AfCFTA has the potential to transform the face of African trade and kickstart the continent`s economic growth and development.