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· The trading phase under the African Continental Free Trade Area (AfCFTA), signed by 54 of the 55 countries in Africa, has launched from January 1, 2021
· The US$ 3 trillion market (Combined GDP of 54 countries) is the largest common market in the world with a population of 1.3 billion people
· Tariff reduction is front loaded
· 90 percent of all intra-African trade goods will become tariff free from January 1 for all the countries that have deposited their instruments of AfCFTA and ratified with the chairperson of the African Union Commission (AUC)
The trading phase under the African Continental Free Trade Area (AfCFTA), signed by 54 of the 55 countries in Africa, has launched from January 1, 2021. The US$ 3 trillion market (Combined GDP of 54 countries) is the largest common market in the world with a population of 1.3 billion people.
A study by the African Export-Import Bank (Afreximbank) points out that the AfCFTA can realise more than US$84 billion in untapped intra-African exports. African leaders requested institutions to provide technical and financial support for its implementation. However, the leaders opined that the sail in the initial days may not be smooth. There can be differences of opinion on the priority products which have to be pushed into the basket for slashing tariffs. A lot of negotiations and trade -offs have to be done for ensuring consensus in this regard. Also, countries will have to harmonize customs and tariff regimes. That is not going to be an easy task given that presently there are eight economic blocs in Africa. The Eastern Africa will generate US$ 1.8 billion in welfare gains and benefit from over 2 million jobs from the successful implementation of AfCFTA, as per the estimates of .the UN Economic Commission for Africa (ECA),
Tariff reduction is front loaded. For instance 90 per cent of all intra-African traded goods will become tariff free from January 1 for all the countries that have deposited their instruments of AfCFTA and ratified with the chairperson of the African Union Commission (AUC). Of the 54 full-fledged members, 36 countries have already completed this procedure. But how far they have progressed in customs harmonization is yet to be ascertained. Eretria, a tiny country in the Horn of Africa, did not give its consent to the deal. AfCFTA is expected to increase employment opportunities and help women get into the workforce. It
