During the US-Africa Summit in 2022, Ghana’s President, Nana Addo Dankwa Akufo-Addo, made several significant statements that should guide Africa toward the Agenda 2063, which is 40 years from now. For once, Africa must succeed in her attempts to reverse the development change.
Agenda 2063 is a strategic framework for the socio-economic transformation of the continent over a long term. It builds on and seeks to accelerate the implementation of past and existing continental initiatives for growth and sustainable development.
The purpose of Agenda 2063 is to:
- To provide a general overview of the Agenda 2063
- To raise awareness and to facilitate domestication
- To sensitise stakeholders, such as the government, its agencies, private sector, the media and CSOs on Agenda 2063.
The vision of the Africa Union is to promote “an integrated, prosperous and peaceful Africa, driven by its own citizens and representing a dynamic force in international arena.” Most importantly, Agenda 2063 is aimed at providing a strong and well-functioning regional institution on which Agenda 2063 can stand strong. In fact, the foundation of every development agenda is often laid several years prior to monitoring and evaluating its success. As President Akufo-Addo pointed out in his speech, “we have done enough talking. It is time for action. We know what we need to do. It is time just to do it. Enough of the excuses for the state of our continent. It is time to make Africa work”, he noted. Mr. Akufo-Addo reiterated the fact that 30 percent of the world’s remaining values are in Africa. But the mystery remains that despite Africa’s rich natural resources, the continent remains the poorest in the world. How did we get to this current situation? How did we get so dominated and controlled?
Global prosperity
Of course, Africa is fundamental to the prosperity of the global economy through the production and supply of raw materials. For this reason, there is no way the west, the Americas and Asia that are exploiting Africa’s will sit back and allow Africa to become self-sufficient and less dependent on them. They will do everything to keep sub-Sahara Africa down and impoverished, and this is strategic to the western ideology. This means all economic structures and global institutions are working to keep Africa where she is now. This is the only way they can continue to exploit Africa’s raw materials to oil their economies.
It is clear that if Africa takes any initiative to wean herself from foreign domination, such as the Africa Continental Free Trade Area (AfCFTA), it will negatively affect the living standards of some countries in the west and Asia. For this reason, those feeding on Africa’s resources will never sit back and allow economic and social transformation, especially through intra-Africa trade. Surely the West and China will fight back, so the onus is on Africa’s leaders to for once, remain committed to AfCFTA and the Agenda 2063.
AfCFTA as game-changer
It is certain that increased local production and trade among African countries have the potential to transform the continent within the 2063 framework. Presently, intra-Africa trade is as low as 14.4 percent of total African exports. Intra-African trade comprises 61 percent processed and semi-processed goods, suggesting higher potential benefits from greater regional trade for transformative and inclusive growth, studies show. UNCTAD forecasts show the AfCFTA could boost intra Africa trade by about 33 percent, and cut the continent’s trade deficit by 51 percent.
Furthermore, increased trade among African countries has the potential to reduce poverty across the continent. UNCTAD forecasts that about 34 percent of households in Africa live below the international poverty line (US$1.9 per day). Meanwhile, around 40 percent of the continent’s total wealth is owned by just a few, though there is potential for equitable distribution of the continent’s development. Intra-African trade is seen as one of the potential areas that could transform Africa’s economy.
As AfCFTA celebrates its second anniversary of operations, the key question remains as to whether AfCFTA can stimulate economic growth, roll back poverty, cut inequality, and foster inclusive development. So far, eight countries— Ghana, Cameroon, Egypt, Kenya, Mauritius, Rwanda, Tanzania and Tunisia are participating in the AfCFTA’s Guided Trade Initiative (GTI), representing five regions across the continent.
The Guided Trade Initiative (GTI) was launched in Accra, Ghana in 2021 and seeks to promote significant commercial trading, and to test the operational, institutional, legal and trade policy environment under the AfCFTA.
The products earmarked to trade under this initiative include ceramic tiles, batteries, tea, coffee, processed meat products, corn starch, sugar, pasta, glucose syrup, dried fruits, sisal fibre, among others. Undoubtedly, Africa has both competitive and comparative advantages in the suggested product and does not need to be importing them. Overall, the projected US$3trillion borderless market could be instrumental in reversing current trends in poverty, inequality, and growth on the continent; and help place Africa on an inclusive and sustainable growth path, says UNCTAD in its 2021 Economic Development in Africa report.
Economic diversification
Experts suggest that AfCFTA is appropriately designed to deepen integration, foster trade and investment, enhance the mobility of capital and labour, support industrialisation, and the development of a dynamic services sector. UNCTAD data shows that Africa’s current untapped export potential amounts to US$21.9billion, equivalent to 43 percent of intra-African exports. An additional US$9.2billion of export potential can be realised through partial tariff liberalisation under the AfCFTA over the next five years, says the UN agency.
“With the AfCFTA, we are creating a tariff-free continent that can boost intra-African trade and investment, grow local businesses, step up industrialisation and create jobs for the teaming youth population,” said Mr. Wamkele Mene, Secretary-General of AfCFTA, during an investment partnership forum in New York last September.
According to Mene, AfCFTA provides Africa a renewed opportunity to steer Africa’s economic development from a reliance on external donors, foreign creditors and excessive commodity dependence. It ushers in a new economic era focused on self-reliant cooperation, deeper integration and higher levels of intra-African trade. In fact, the area that AfCFTA could make a huge impact is in creating a tariff-free continent that can boost intra-African trade and investment, grow local businesses, improve industrialisation, and create jobs for the growing youth population.
Challenges
With her vast natural resources Africa has no reason to remain the world’s poorest continent. However, having a trade agreement is one thing, and the having the political will to implement the agreement is quite another. In the past, Africa had some great policies but lack of political commitment and loyalty to Africa’s vision to wean herself from foreign domination remain the bane.
As AfCFTA forges ahead in its second year of operations, progress is markedly slow in some areas. In this era of globalisation and easy movements of goods and services, Africa remains the only continent where visas are still required for travelling to neighbouring countries. So, far only Benin, Gambia and Seychelles allow visa free entry to all Africans. This indicates that Africa has a lot of work to do to promote continental integration. That notwithstanding, the African Development Bank (AfDB), in its report at the 2022 African Economic Conference (AEC) in Mauritius, says travel has become more open to African citizens in 2022, with fewer restrictions.
According to the 2022 Africa Visa Openness Index, there is some balance between visa free travel, and visa obtained on arrival at the country of destination. Africa is home to 12 percent of the world’s population, yet accounts for less than 1 percent of the global air service market, according to a 2010 World Bank study on how liberalised air transport would deliver improved air safety, lower fares and increase traffic in Africa. A World Bank study, titled ‘Open Skies for Africa—Implementing the Yamoussoukro Decision’, indicates that many African countries restrict their air services markets to protect the share held by state-owned air carriers.
UNCTAD’s 2021 Review of Maritime Transport shows the AfCFTA has the potential to boost maritime trade in Africa as it will raise demand for different means of transport. In turn, this will heighten infrastructure investment, which goes hand in hand with ports and sea-going vessels. In this regard, regional integration is critical as it fosters cooperation and removes barriers to trade that impede the movement of people, goods, services and expertise.
Gender equality
Sustainable Development Goal (SDG) five is about promoting gender equality in every human endeavour, including trade. Besides promoting an end to all forms of discrimination, violence and harmful practices against women and girls, SDG five also advocates for the full participation of women and equal opportunities for political leadership and economic decision-making. To achieve SDG five on gender equality and empowerment of women, AfCFTA needs to innovate and implement stronger measures targetting women and youths, who in some countries make up about 70 percent to 80 percent of small businesses and cross-border traders – the largest share of informal traders, according to UNCTAD.
Moving forward
Looking forward, Africa needs to move quickly to remove or normalise the various intra-African non-tariff barriers, including costly non-tariff measures, infrastructure gaps, and market information gaps. In addition, long-term cooperation in investment and competition policies will be essential, and this will help circumvent market dominance by a few players and reverse structural and regulatory barriers to market entry.
As President Akufo-Addo noted in his speech, “nothing succeeds like success”, and no one can make Africa to succeed without Africans leading the initiative. “If we work at it, if we stop being beggars and spend Africa’s money inside the continent, Africa will not need to ask for respect from anyone. We would get the respect we deserve,” President Akufo-Addo reminded African leaders. In fact, no one can change Africa’s narrative, except Africans.
