Trade activities under Africa Continental Free Trade Area gain momentum

Countries have begun actively trading with each other, removing trade barriers and sensitising small businesses to tap into opportunities presented by the world's largest single market.

Earlier in the month, Kenya and South Africa signed a memorandum of Understanding that removes entry hurdles and fosters mutual working relations between traders.

The biggest win is the visa-free travel deal that allows up to 90 days of access to residents of these markets annually using their ordinary passports starting in 2023.

"President Ramaphosa and I have also agreed to develop a sustainable mechanism to identify, monitor and resolve non-tariff barriers that limit the trade potential between our two countries," said Kenya's President, William Ruto.

South Africa's President Cyril Ramaphosa added that the MoU, which also allows creatives and artists from the two countries to work together, demonstrated a firm commitment to sustainably increase trade volumes and foster greater investments in each other's economy.

In October, Kenya also made two twin shipments of batteries and Tea to Ghana in a trial phase that will see six other countries- Egypt, Cameroon, Mauritius, Rwanda, Senegal, and Tanzania accelerate cross-border trade.

Ninety-six products, including pharmaceutical, rubber, steel and sugar, have been lined up for trade under an AfCFTA-guided trade initiative launched in October, with high prospects for tripling activities in 2023.

Ethiopia has also begun opening up its borders by easing restrictions on foreign investments following the commercial launch of Kenya's giant telco Safaricom. It also plans to liberalise its banking sector to allow regional lenders to operate in the country.

According to a local media outlet, The reporter, Ethiopia's central bank is finalising preparations for legal frameworks to embark on an open-up process as it hints at the same capital ( US $95 million) entry requirement for foreign banks as locals.

"All the laws applicable to local banks will be similarly applicable to foreign banks," the media quoted NBE vice governor and chief economist, Fikadu Digafe.

A policy and strategy document prepared by the National Bank of Ethiopia titled "Investment of Foreign Nationals in the Ethiopian Banking Sector" already proposes four entry modalities.

Foreign banks can set up a subsidiary, a branch, a commercial representative office or acquire equity in local banks through a joint venture.

This month, Namibia, Mauritius and Ghana launched national strategies and rolled out campaigns to trumpet the benefits of the single largest market as they assess the level of preparedness among small and medium businesses in their countries.

Mauritius launched The African Continental Free Trade Area (AFCFTA) National Strategy Response to enhance preparedness and readiness for intra-African trade, new markets and investment opportunities for its Small and Medium Enterprises (SMEs).

Mauritius Minister of Foreign Affairs, Regional Integration and International Trade, Alan Ganoo, said the country would leverage on AfCFTA to seize the opportunity and explore new markets on the African continent by strengthening its manufacturing base and diversifying traditional export markets.

''We are leaving no stone unturned to maximise the benefits of the landmark achievement of the Agenda 2063, The Africa We Want,'' said Ganoo.

Ghana's National AfCFTA coordination office is running a sensitisation campaign as it targets to assess the export readiness of 180 SMEs with plans to support at least 50 of these companies to expand operations beyond national borders.

"The results of these assessments/audits will determine the technical, financial and capacity-building assistance/intervention that would be provided to the targeted companies to export under AfCFTA," said a statement from Ghana's National AfCFTA Coordination office.

In a Pan-African private sector trade and investment committee survey, most CEOs from small and medium-sized enterprises across Africa shared their confidence in the AFCTA's ability to improve economic activities on the continent.

"Our survey clearly shows that the vast majority of African CEOs believe that the implementation of the AfCFTA will positively affect the levels of intra-African trade, even as early as 2022-23," the report stated.

bird, Africa Story Agency