African countries launched the continent-wide free trade area, AfCFTA, with fanfare in Niamey, Niger, last weekend. In a way, the African Union extraordinary summit quietened naysayers who were largely focused on the hurdles ahead rather than the promise that customs-free trade carried.
A market of 1.2 billion people and a $3 trillion (Sh300 trillion) economy unhindered by tariffs would help in selling Africa as one investment destination, helping industries to expand and new ones to establish. That alone would tackle one of its foremost challenges, youth unemployment, and reverse the global economic order where Africa’s resources end up in factories abroad, are processed and then brought back as expensive finished products.
Support for the bloc has come swiftly with the Africa Import Export Bank announcing a $1 billion kitty to cushion countries that ratify the treaty from potential loss, mostly revenue related. Working with the AU, it will also establish a digital payment interface through which transactions will be settled in local currency across the continent. From the hardware side, therefore, the only way for the African Continental Free Trade Area (AfCFTA) is up.
These underpinnings, however, are far from the essence of free trade. Interactions at all levels should start with a personal touch, allowing free movement of people — who can criss-cross the continent, discover new opportunities and innovate on how to exploit them. This has been a key drawback of existing regional free trade agreements that will feed the AfCFTA and, we hope, bad manners will not be exported to the bigger bloc.
In East Africa, migration challenges such as denial of passports and work permits continue to dominate what should, essentially, be a common market where labour moves freely. Discussions on portability of higher education credentials drags on at a snail’s pace. This is one area where the AfCTA could look to leapfrog regional blocs by having students from other parts of Africa train in any of the 55 countries as home students, like in Europe.
The One Network Area (ONA) telecommunications regime has only been embraced by a few countries even as the World Bank presses on with its initiative to build a digital economy and bring down physical barriers in Africa. A generation on, the Yamoussoukro vision of open skies in Africa remains largely on paper.
That travellers have to go through the Middle East or Europe to access some African destinations speaks volumes on the need to integrate a human face early not just into the AfCFTA, but also in other regional blocs. It is this that will win mass support for the initiatives, pulling hesitant public officials along.