The country needs a dedicated fund to enable it implement the African Continental Free Trade Area (AfCFTA) fully and in a manner that accrues to the benefit of industry, the Association of Ghana Industries (AGI) has advocated.
The AfCFTA – the single largest untapped continental market available for trade and immediate investment – commenced in January this year; but the AGI fears the absence of a dedicated fund, given the current economic climate due to the pandemic, might negatively impact its execution.
It is against this background, and given the enormous benefits that a comprehensive implementation of the agreement would bring to the economy, that the AGI wants government to set aside funds to ensure smooth enforcement.
Such a fund, AGI’s Vice President Humphrey Dake explains, will ensure full implementation of the treaty to the letter and position local industries to reap the full benefits of a continental free trade zone.
“We need to have a dedicated fund for AfCFTA implementation to empower industry to take full advantage of the agreement,” he said.
Mr. Dake, who spoke in Accra during the Greater Accra Regional AGI annual general meeting, said a dedicated fund will speed up implementation, strengthen policy direction, education and aid efforts to make the country a major player within the AFCFTA bloc.
The secretariat is hosted in Accra, and Ghana – as one of the leading members – is expected to provide leadership in policy direction and implementation.
With 1.3 billion people across Africa and a combined US$3.4trillion GDP, 55 countries in Africa have ratified the AfCFTA; thus making the agreement the most significant single duty-free trade area ever formed by a collective group of countries in the world.
The treaty makes the continent, for the very first time according to market watchers, united on one front.
AfCFTA, according to the World Bank, will significantly boost African trade; particularly intra-regional trade in manufacturing. The volume of total exports is expected to increase by almost 29 percent by 2035 relative to the baseline. Intra-continental exports will also increase by over 81 percent, while exports to non-African countries rise by 19 percent.
A World Bank report has re-emphasised the importance of the African Continental Free Trade Area (AfCFTA) agreement in becoming a game-changer on the continent, especially as African countries seek to bounce back from devastation caused by the coronavirus pandemic.
According to the World Bank, economic growth in the region is projected to decline from 2.4 percent in 2019 to between −2.1 percent to −5.1 percent in 2020, the first recession in the past quarter century. It will also cost the region between US$37billion and US$79billion in terms of output losses for 2020.