A recent IEEE (Institute of Electrical and Electronics Engineers) trip to Tunisia, Kenya, and please give me full report for my news site about Operational Phase Of The African Continental Free Trade Area Launched

Operational Phase of the African Continental Free Trade Area (AfCFTA) Launched

The African Continental Free Trade Area (AfCFTA) officially entered its operational phase, marking a historic milestone in the continent’s efforts toward economic integration. The launch of AfCFTA’s operational phase took place during the 12th Extraordinary Summit of the African Union (AU) held in Niamey, Niger, with heads of state and government from across the continent attending to witness this pivotal moment for Africa’s trade future. This agreement is the largest free trade area by the number of participating countries since the establishment of the World Trade Organization (WTO), bringing together all 55 member states of the AU.

What is the African Continental Free Trade Area?

The AfCFTA is an ambitious trade agreement that aims to create a single market for goods and services across Africa, enhancing intra-African trade and economic integration. The agreement seeks to remove tariffs on 90% of goods, reduce non-tariff barriers, and promote investment, industrialization, and economic diversification.

The AfCFTA is designed to:

Boost Intra-African Trade: By eliminating tariffs and addressing non-tariff barriers, AfCFTA will increase trade among African nations, fostering economic growth and collaboration.
Create a Single African Market: The agreement creates a market of over 1.3 billion people with a combined GDP of over $3.4 trillion, making it a major player in the global economy.
Promote Industrialization: AfCFTA encourages industrialization by fostering investment in manufacturing, which will help reduce Africa’s dependence on raw material exports and promote value addition.
Enhance Competitiveness: By promoting competition and investment, the agreement is expected to improve the competitiveness of African businesses and industries, paving the way for innovation and efficiency.

Key Operational Instruments Launched

Several key instruments were launched to support the operationalization of AfCFTA, including:

The AfCFTA Trade in Goods Dashboard: This tool will help facilitate the monitoring and regulation of trade activities across the continent, ensuring compliance with the agreement’s provisions.
The Online Mechanism for Monitoring, Reporting, and Elimination of Non-Tariff Barriers (NTBs): This is a digital platform to address NTBs in real-time, enabling businesses to report obstacles to trade and receive assistance from the relevant authorities.
The Pan-African Payments and Settlement System (PAPSS): This initiative simplifies cross-border transactions by enabling payments in local currencies, reducing the need for foreign currencies and cutting transaction costs.
The African Trade Observatory: A tool designed to provide trade data to businesses and policymakers to help them make informed decisions and seize opportunities across the African market.

Impact on African Economies

The AfCFTA is expected to significantly transform African economies by increasing intra-African trade, boosting economic growth, and creating jobs. According to the United Nations Economic Commission for Africa (UNECA), the AfCFTA could increase intra-African trade by 52.3% by 2022. It also presents an opportunity for African nations to diversify their economies, reduce dependence on exports of raw materials, and shift toward higher-value industrial production.

Challenges Ahead

While the launch of AfCFTA is a historic achievement, several challenges remain:

Infrastructure Deficit: Africa’s inadequate infrastructure, particularly in transport, energy, and ICT, could limit the effective implementation of AfCFTA and hinder the movement of goods and services across borders.
Diverse Economic Structures: African countries vary greatly in terms of their economic structures, making it challenging to implement a uniform trade policy across the continent. The capacity of individual states to implement AfCFTA provisions will be critical to its success.
Political Will: Sustaining the political will to overcome national interests and push forward with the full implementation of AfCFTA will be key. Countries will need to ensure that national policies align with the goals of AfCFTA.

Conclusion

The operational launch of the African Continental Free Trade Area is a major step toward the realization of Africa’s economic integration ambitions. While challenges remain, the benefits of a more integrated African market, increased intra-continental trade, and industrialization could transform Africa’s economic landscape in the coming decades. The AfCFTA offers the potential to lift millions out of poverty and build a more prosperous future for the continent.