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Private sector crucial to successful AfCFTA implementation, Africa Trade Forum delegates agree

Private sector crucial to successful AfCFTA implementation, Africa Trade Forum delegates agree
Photo credit: UNECA

07 Nov 2018

The 2018 Africa Trade Forum ended in Lagos, Nigeria, with delegates agreeing that while governments need to set a conducive environment through collective and coordinated actions for the successful implementation of the African Continental Free Trade Area, the private sector should to be the main driver of the AfCFTA.

They also agreed that complementary interventions to boost competitiveness and reduce the high costs of doing business on the African continent would be crucial to ensure win-win gains from the AfCFTA – these will require proactive policies and programmes in the areas of infrastructure, financing, skills development, trade facilitation and quality infrastructure.

“In implementing the AfCFTA we must also make sure not to forget MSMEs, women traders, smallholder farmers and informal cross border traders, who represent the majority of Africa’s trading community, and are crucial to driving poverty reduction efforts,” Economic Commission for Africa’s Regional Integration and Trade Division Director, Stephen Karingi said in summing up the major takeaways from the Forum.

Delegates agreed the establishment of new business models, including renewable energy mini grids, was key to ensure efficient and sustainable access to electricity and help fill the existing gap.

“The recommendation is that we should promote new and reinforce existent sub-regional power pools within the continent,” Mr. Karingi said.

Data, delegates agreed, was critical for the implementation of the AfCFTA. Countries, regional economic communities and the African Union Commission need to understand trade patterns to determine the correct strategies. Data is also central to the monitoring of the AfCFTA.

“Africa needs to design a data economy strategy to ensure that it is not vulnerable through data exposure caused by data storage in other regions. The combination of data and technology can address the challenges around formalisation of trade,” added Mr. Karingi in his closing remarks.

On agriculture, delegates said the AfCFTA by integrating African economies, offers opportunities for the continent to reduce its food imports from the rest of the World by increasing intra-African trade of processed agro-food products. For this to happen, effective implementation of the Agreement is key, in addition to removing non-tariff barriers to trade. Critical to this is to create an environment that will support small farmers and small producers (SMEs) to have timely access to markets, both output and input markets.

On the next steps, Mr. Karingi said the ECA with financial support of the EU was offering technical assistance to support Member States in developing comprehensive AfCFTA National Implementation Strategies. These strategies will:

  • Identify new opportunities for diversification, industrialization and value chain development;

  • Identify current constraints to intra-African trade which must be addressed;

  • Recommend steps required for each country to take full advantage of national, regional and global markets in the AfCFTA context;

  • Align to existing policy frameworks at the national, regional and continental levels; and

  • Adopt a nationally-driven multi-stakeholder participatory approach.

Consensus

The Forum highlighted the crucial importance of advocacy, consultations and consensus-building on the continent around its major programmes.

Mr. Karingi thanked Nigeria and the Government of Lagos State for hosting the forum and for their dedicated support and collaboration in the lead up to this Forum.

“Although Nigeria has not yet signed the AfCFTA, it is in many ways many steps ahead in ensuring that the Agreement is a real game changer for economic transformation and development,” he said.

For her part, Rockefeller Foundation’s Vice President, Global Policy and Advocacy, Christine Heenan, emphasized the importance of partnerships in ensuring the AfCFTA was a real game changer in Africa.

She said an online poll commissioned by Rockefeller was very compelling with more than 83 percent of respondents from across the continent saying the AfCFTA was important for Africa’s development. The poll is open until December 31.

“Engaging stakeholders remains very important,” she said, adding the poll meant a lot in terms of inclusivity of common African voices in the implementation of the African Continental Free Trade Agreement.

The Rockefeller Foundation, Ms. Heenan said, believed and relied on its partners for collective action that leads to progress on the continent.

In his closing remarks AUC’s Trade and Industry Commissioner, Albert Muchanga said six African countries have not yet signed the AFCFTA but two were expected to do so by December.

“African countries have resolved and are committed to making the AfCFTA a reality and there is no going back. We have to continually beat the challenges and use opportunities to come up with solutions,” he said.

Ambassafor Chiedu Osakwe, Nigeria’s Chief Trade Negotiator, said to build a free trade area, Africa has to be at ease with the process of sincere debates on its trade policies.

“The European Union dealt with a lot of continuous debate for a long period of time. African countries need to work on consensus building, being at ease with challenges on ideas, methodologies and processes in order to be at ease with the negotiations process,” Ambassador Osakwe said.

The Africa Trade Forum, which was held under the theme; AfCFTA Ratification and implementation: A game changer for African economies, was co-organized by the ECA, the Rockefeller Foundation, and the Nigerian government in collaboration with the AUC.