The Secretary-General of the Africa Continental Free Trade Area (AfCFTA), Wamkele Mene, has stated that the high hopes and expectations banked on the newly created largest trade market in the world, AfCFTA, will come to nothing if countries and regional blocks fail to industrialise.
According to him, though Africa is home to about 60 percent of the world’s natural resources and arable land for agriculture purposes, it is still losing out on the global stage because of lacking industrialisation. Hence the need to leverage AfCFTA to industrialise and serve its over-1.3 billion people market size.
“If we do not focus on the industrialisation of our continent or accelerating its petty industrial sectors, we shall not observe full benefits of the free trade area and cannot emerge from effects of the conflict in Ukraine
“It is clear that where Africa is losing is in the lack of industrialisation; and even if Africa is industrialised, the fragmentation in movement and markets will still be a barrier, hence the importance of AfCFTA to iron-out all these fragments,” he said.
Further, he stated that in 2019 about US$16billion worth of raw materials were exported from Africa, processed and sent back to the continent; and that is about 15 million jobs exported to the rest of the world
Nonetheless, he emphasised that without trade finance capital it will be highly impossible to create the industries which will bring about the transformation.
“We have been relying on others to come and invest in our continent, but unfortunately intra-Africa investment is less than five percent; intra-Africa trade is between 17 and 18 percent. We are trading more with western countries than we trade among ourselves as Africans – and that is because of the fragmentation of rules and markets, and production and export of raw materials. We must change these narratives,” he said.
Furthermore, he emphasised that the need for Africa to industrialise is a no-brainer because almost 94 percent of its medicinal and pharmaceutical needs worth US$16billion are imported onto the continent annually – when the raw material for this industry is from agriculture, of which Africa is a hub.
He assured that the AfCFTA secretariat will work assiduously to ensure the elimination of all trade barriers on the continent, remove all fragmentations in rules and markets, and collaborate with Afreximbank and other financial capital service providers to make trade finance available for industrialisation.
“Without a well-integrated single market, we are not going to achieve the objective of industrialisation, job creation, developing national economies, and reaching global standards. By 2035, 97 percent of goods traded under AfCFTA must be duty-free,” he emphasised.
He made these remarks while speaking on the theme ‘Supporting the Africa Trade Agenda- Ensuring the last mile’ at the Ghana Trade Roadshow (GTRS) organised by Afreximbank in partnership with the Oakwood Green Africa Limited, the Ghana Free Zones Authority (GFZA), Ghana Export Promotion Authority (GEPA) and the AfCFTA secretariat.
Chief Executive Officer-GEPA, Dr. Afua Asabea Asare, remarked in a speech read on her behalf that with the support of public and private sector institutions, a national export development strategy (NEDS) to provide a clear vision for the desired evolution of Ghana’s non-traditional export sector.
“We believe very strongly that NEDS, which also aligns with other government strategic anchor industries for economic transformation, is Ghana’s answer to our effective participation in the AfCFTA and ultimately, our economic breakthrough,” she said.
Managing Partner, Oakwood Green Africa Limited, Gabriel Edgal, on his part indicated that his outfit will play a major supporting role as a conduit for capital to enhance trade in Africa under the AfCFTA, facilitate building productive capacities of businesses, and provide trade advisory and financial services to industries.