AfCFTA doesn’t solve red tape impediments – Seifsa
3 Jun 2019 - by Staff reporter
While the African Continental Free Trade Area (AfCFTA) - which kicked in on 30 May - had significant potential for intra-continental trade, chief economist at the Steel and Engineering Industries Federation of SA (Seifsa) CEO Dr Michael Ade warned that non-tariff barriers such as the plethora of documentation needed for cross-border trade transactions remained enormous impediments to intra-African trade.
AfCFTA provides access to a continent-wide market of 1.2 billion people worth $2.5 trillion.
The deal effectively places Africa as the world’s largest free trade zone by population since the 1995 creation of the World Trade Organisation (WTO).
The agreement’s operational phase will be launched on July 7 at an African Union summit in Niger, with some minor issues – including rules of origin – still to be resolved.
“It will effectively breathe life into the largest trading bloc in the world, creating a single continental market for goods and services, with free and unfettered movement of business people and investments. It cuts duties on 90% of goods and is expected to boost regional and international trade and to improve on the proportion of trade by African nations with continental neighbours.”