At the end of May, Africa’s landmark free trade deal came into effect, accompanied by widespread optimism that it could usher in a new era of intra-African trade possibilities and prosperity for the continent’s citizens.
The African Continental Free Trade Agreement (AfCFTA) aims to create a single market for goods and services, facilitate free movement of people and investments, and eventually a single-currency union. This has the potential to tackle one of the most fundamental problems holding back development and business expansion in African countries: the lack of a cohesive and uniform pan-African approach to trade.
African nations are increasingly empowered by an expanding global marketplace, diversifying economies and rapid improvements to tech infrastructure and mobile penetration. Combine that with a GDP of over $3tn and a growing population of young, ambitious and tech-savvy citizens, the countries which make up Africa’s regional bloc are bubbling with potential.
Unfortunately, existing World Trade Organisation (WTO) agreements and frameworks hinder African development. For the most part international trade agreements cement a status quo that disenfranchises African countries and makes it legal to expropriate their natural resources. Of course, these same agreements and trade imbalances have also undermined the stability and sustainability of the countries that created and enforce them. Growing global inequality and instability is the inevitable result of the “winner takes all” world, in which we currently live.
In order for global trade to be truly equitable, there needs be a level playing field between all participants – be they countries or global corporations. Such a playing field could be achieved if African countries worked together through an effective African Union (AU).
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