Experts stress private sector role in intra-African trade
By Jeph Ajobaju, Chief Copy Editor
Private sector relevance in the implementation of the African Continental Free Trade Area (AfCFTA) has been highlighted by experts at roundtable jointly organised by the Economic Commission for Africa (ECA) and the Konrad Adenauer Stiftung (KAS) Office Ethiopia/AU.
ECA Deputy Executive Secretary Antonio Pedro told more than 150 leaders of business, government, civil society, and United Nations officials that the private sector is the backbone of production and trade, thus central to the success of AfCFTA.
“The national AfCFTA implementation strategies being developed by several countries with the support of ECA, highlight the importance of inclusive implementation of the AfCFTA through improved private sector engagement, including Small and Medium Enterprises (SMEs) as well as women and youth,” he said.
Chief Executive Officer, Pan African Payment and Settlement System (PAPSS) Afreximbank, Mike Ogbalu, had previously argued that charges, payments and other barriers cost African business more than $5 billion a year.
He said 80 per cent of payments destined for somewhere else on the continent, first of all have to travel somewhere else before getting to their final destination, saying this is the reason why intra-African trade is low at 15 to 18 per cent.
He noted that Africa trades more with rest of the world than with itself.
Pedro spoke about AfCFTA Country Business Index (ACBI), which is the primary and innovative tool to capture private sector opinion on the implementation of the Agreement and provides information on trade challenges faced by women traders and small businesses.
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Promotion of regional trade
The panel discussion focused on the central role of the private sector in promoting regional integration, cooperation and ensuring a successful implementation of AfCFTA, according to The Guardian (Nigeria).
Ethiopian State Minister of Trade and Regional Integration, Endalew Mekonnen, cited the experience of his country turning the page on decades of reliance on the state to drive economic growth and unleashing private sector potential.
“Recent government reforms and incentives have created new investment and business opportunities to revitalise the economy by broadening the role of the private sector and to encourage private sector development in various fields including infrastructure,” Mekonnen said.
“We firmly believe that strengthening our trade relations within Africa through AfCFTA is very critical, not only because of the volume of trade but also in achieving the objective of Pan-African movement in the framework of creating a strong and united Africa.”
KAS Country Representative for Ethiopia/African Union, Benno Müchler added: “As a humble observer of Africa’s steps to a future in prosperity, I believe the AfCFTA holds the biggest promise for the citizens of Africa and its coming generations.”
Müchler said the German government is keen to strengthen trade relations between Africa and the world.
As a German political foundation with more than 20 offices in Africa, he stressed, KAS understands very well the importance of foreign direct investment, Africa’s economic potential and the many opportunities it has to offer.
He expressed the hope that trade between Africa and the world under AfCFTA will grow and create more value addition and jobs on the continent.
“Bringing the private sector on board on the last miles towards the AfCFTA will be crucial for its success. The private sector has its ears and eyes where the states have none.”
Other speakers equally highlighted the need for more work to be done to raise awareness of the details of AfCFTA and how firms can participate.