African continent agrees to landmark free-trade agreement
A MILESTONE free-trade agreement has just gone into effect on the African continent, stripping away the majority of tariffs and other commercial barriers now that the 54 member states are willing to implement the accord
A MILESTONE free-trade agreement has just gone into effect on the African continent, stripping away the majority of tariffs and other commercial barriers now that the 54 member states are willing to implement the accord.
The members meeting at an African Union summit in Niger's capital Niamey agreed on mechanisms that will underscore the accord, including deciding upon the rules of origin, a digital payment system, an online tool for listing products and tariffs, and a monitoring system to deal with non-trade barriers, reported Bloomberg.
The African Free Trade Agreement commits the governments to closer economic integration, as the signatory states commence a multiyear process to surrender trade barriers including tariffs on 90 per cent of commodities.
The duty-free movement of goods is likely to lift regional trade, and enable countries to move away from mainly exporting raw materials and build manufacturing capacity to draw foreign investment.
The agreement now includes 54 signatories, after Benin and Nigeria joined the accord recently. In total, 27 countries including Kenya, Ghana, Gambia and Gabon have ratified the pact that came into force in May. Morocco announced it would ratify within days.
Ghana will be home for the secretariat, or permanent office, of the trade zone, Egyptian President Abdel Fattah al-Sisi - chairman of the African Union - said in his closing statement.
Ghana President Nana Addo Dankwa Akufo-Addo said his country is willing to give US$10 million to help establish the office.
Trading with the lower tariffs will kick off in July 2020 to allow member states time to adopt the framework and prepare their business communities for the 'emerging market', according to African Union's commissioner for trade and industry Albert Muchanga.