Emmanuel Owusu’s thoughts: Localising African Continental Free Trade Area

AFCTA Meeting in Kigali

The African Continental Free Trade Area (AfCFTA) agreement was signed on March 21, 2018, by 44 member-countries: to create a continental market for goods and services, with free movement of people and capital; as well as facilitate space for the creation of a Customs Union. This trade area is expected to unite Africa’s human population of 1.3 billion in a potential US$3trillion economy, with a consequential economic benefit of making Africa the world’s largest free trade area since the formation of the World Trade Organisation.

The main objective of the AfCFTA is to expand intra-African trade through better harmonisation and coordination of trade liberalisation across the continent. The AfCFTA is further expected to enhance competitiveness at the industry and enterprise levels through the exploitation of opportunities for scale production, continental market access, and better reallocation of resources.

Industrialising through AfCFTA

In order to convert the colonial economic model into a more functional and structured trade-driven economy, we need to stimulate industry profiling to determine which kind of industries are operating in Ghana and what they produce to guide us in knowing what we are selling to Africa through the AfCFTA model. We can achieve this through engaging trade agencies under the Ministry of Trade and District Assemblies, where these industries operate from, or through the Registrar-Generals’ Department. This profiling will help the country fully benefit from AfCFTA through a structured system because as a country we can easily determine which industries are bringing the state revenue from the AfCFTA model.

We need to also tie in the 1 District 1 Factory Policy to AfCFTA, by establishing factories that can serve the underserved trade areas of the African market.  This we can do by empowering local industries to scale-up their production.

Key to the above is improving trade facilitation to boost trade and reduce costs. Ghana could take a number of steps to achieve this by making sure all Customs locations have information technology systems that support core processes and can be used by traders and officials without compromising Customs rules and regulations.

COVID-19 Lessons and the New Trade Normal

COVID-19 has taught the world that you don’t need to be physically present in a particular country to do business. It has removed all physical trade barriers and reaffirmed the need to trade virtually. In view of this, to effectively benefit from AfCFTA we need to establish an on-line trade portal that enables neighbouring African countries to trade with Ghanaian businesses virtually.

This virtual platform will be called the Ghana Trade Mall, with the single goal of bringing together Ghanaian businesses to connect with prospective trade partners across the continent. This platform will connect with our port and banking system to allow for easier export activities and payment.

To achieve this, the Ministry of Trade must show leadership by collaborating with Ghana Investment Promotion Centre (GIPC), Ghana Free Zones Board (GFZB), National Board for Small Scale Industries (NBSSIs), Ghana National Chamber of Commerce (GNCC) and other relevant stakeholders to establish this common platform.

Through this platform, Ghanaian business can reduce trade-cost and time, which will make them more profitable and on top of the continent with regard to trade and industry.

Photo: Emmanuel Owusu, Executive Director of Movement for Responsible and Accountable Governance (MoRAG),

About the Author:

Emmanuel Owusu is Policy Analyst with considerable knowledge and expertise in local economic development, policy formulation and strategic management.

He is currently the Executive Director of Movement for Responsible and Accountable Governance (MoRAG), a civil society organisation.

Contact the Author on 0248110208, [email protected]

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