Prime Minister Edouard Ngirente has called on African leaders to focus on the newly launched African Continental Free Trade Area (AfCFTA), saying it was a key player to boosting Intra-African trade and investment.
The premier was speaking at the opening of the ongoing Intra-Africa Trade Fair in Durban, South Africa Monday, November 15.
The event brought together over 10,000 participants including Heads of State from different African countries.
According to Ngirente, the fair is a good opportunity to build on successes of the first Intra-Africa Trade Fair, which took place in Egypt in 2018, where African businesses registered trade and investment deals worth over $32 billion.
It is also the first of its kind, since Africa reached a major milestone-trading under the Continental Free Trade Area, he said.
The bloc was established in a quest to accelerate intra-African trade and also boost Africa’s trading position in the global marketplace.
The Premier said that current statistics show that Africa’s economy is expected to rebound from a contraction of 2.1 percent recorded in 2020 to 3.4 percent growth this year and 4.6 percent in 2022.
Despite this projected positive trends towards recovery in 2021, Ngirente decried that other figures indicate how Africa still lags behind other continents.
"And lowering trade costs for deeper integration of markets is one of the key strategic responses to bridge this gap…there has never been a better time for supporting Intra-African trade than today.”
Need to boost private sector
Most importantly, Ngirente noted that with over 1.3 billion people, and about a gross domestic product of $2.6 trillion, the implementation of AfCFTA will fast-track the development of value chains on the continent and achieve the economies of scale to drive industrialization and trade.
"Developing an innovative manufacturing ecosystem in Africa is important to increase economic competitiveness and production. However, to attain the full potential of our manufacturing sector, more efforts are required to boost the private sector.”
Value of integration
The Premier said that the pandemic has further illustrated the value of integration, citing that it highlighted the fragility of reliance on external supplies, the areas to improve in different systems, and the importance of ensuring that integration is key in African countries’ broader development agendas.
"Improving economic resilience and growth outcomes during this period will therefore require African countries to deepen their collaboration as embedded in the intra-Africa supply chains.”
The pandemic has also emphasized the need to leverage the use of technology in facilitating the movement of goods, he said.
For instance, Ngirente shared Rwanda’s recovery efforts, citing that they are in line with the government’s medium to long-term development strategies.
Building bridges
Meanwhile, South African President Cyril Ramaphosa maintained that this year’s Intra-African Trade Fair is about building bridges. He said that it brings together governments, buyers, investors, entrepreneurs and manufacturers from more than 55 countries to give life to the AfCFTA. The countries of Africa are open for business, he said. "Since ancient times, trade has been the engine that connected communities both near and far. Throughout history, Africa has had a network of trade routes that facilitated the flow of goods such as beads, carvings, ivory, gold, gum, metal works, salt, textiles and metals.
These trade routes enabled African traders to seek out markets beyond the continent,” said President Ramaphosa adding that colonialism has ‘deeply’ damaged the development causing great harm to societies.
The South African leader pointed out that much as the economic storyline of colonialism persists today, "Africa is taking concrete steps to write down its own economic success.”
It is opening new fields of opportunity, he added.
For instance, President Ramaphosa shared that a recent report from the Brookings Institution notes that Africa is already the largest adopter of mobile money transfer systems, comprising nearly half of the globe’s registered mobile money customers, approximately 70 percent of global mobile money transactions, and two-thirds of the transaction volume by value.
Ramaphosa called on countries to work with speed to resolve any outstanding issues around the AfCFTA, emphasizing that countries who have not already ratified it do so as part of the effort towards domestication.
He commended the African Development Bank for its recent pledge to make implementation of AfCFTA a key component of the bank’s lending program.