Free Trade Agreements in Africa present an opportunity for African countries to improve intra-regional trade.
Director of the New Partnership for Africa’s Development (NEPAD) at the Department of Trade and Industry (dti) Claudia Furriel said the continent’s free trade agreements, particularly the Tripartite Free Trade Agreement and the envisaged Continental Free Trade Area present an opportunity for African countries to improve intra-regional trade and diversify Africa’s current trade model of exporting raw materials and importing of finished products.
Furriel was speaking at a session on trade agreements on the fourth day of the Southern African Development Community (SADC) Industrialisation Week taking place in Sunninghill, Johannesburg.
“The Free Trade negotiations launched in June 2011 between the SADC, Common Market for Eastern and Southern Africa (COMESA) and the East Africa countries would open up a market of US 1.3 trillion in terms of the Gross Domestic Product.”
“In addition, the continental free trade that is to be established with 55 countries and a GDP of US 2.6 trillion presents an opportunity to access greater markets. On this free trade agreement, we are not only looking at trade in goods but also trade in services. Market integration, supported by infrastructure development and industrial development, will enable Africa to become competitive and benefit from other trade agreements with other partners,” said Furriel.
Furriel told delegates at the conference the continent’s full potential will remain unfulfilled unless challenges of poor infrastructure, small and fragmented markets, under-developed production structures and inadequate economic transformation are addressed.
“Regional integration is an important aspiration of the African Union’s Agenda 2063 and remains a critical component of the continent’s efforts to ensure sustainable economic development and inclusive growth through the creation of a larger regional market and improving Africa’s integration in the global economy,” she said on Thursday.
In addition, South Africa promotes a development integration approach, based on the three pillars of market integration, infrastructure development and industrial development. The country, she said, remains committed to a coordinated strategy to boost intra-Africa trade and build an integrated market in Africa.
She stressed that the regional free trade agreements have a potential for attracting investment to a larger markets and transform African economies.
The Trade and Investment Officer at the United States of America Embassy in South Africa, Juan Cammarano, said the extension of the African Growth and Opportunity Act (AGOA) was an indication that the US’s job was not complete in Africa.
Cammarano said the extension presented an opportunity for businesses to continue to grow, build capacity and commercial relations and urged them to look beyond 2025.
AGOA is a unilateral US trade preference programme that provides duty-free, quota-free treatment for over 6 400 tariff lines into the United States market. Former US President Barrack Obama signed into law the Trade Preferences Extension Act of 2015 that contained the AGOA Extension and Enhancement Act, which extended AGOA for 10 years until 2025 – with South Africa included.
The theme of the week-long conference that draws to a close on Friday is “Partnering with the Private Sector in Developing Industry and Regional Value Chains”. – SAnews.gov.za