Africa should prioritise trade and industrial sectors to address most of the prevailing challenges the continent faces, including the high rate of unemployment, to ensure sustainable development, Fatima Haram Acyl, the African Union (AU) commissioner for trade and industry, has said.
“While everyone should work to ensure peace, food security, and creating more jobs for the youth, I believe all these can happen if we invest in trade and industries. Industrialisation is critical to Africa’s development because it addresses issues like productive capacity, value-addition, and movement of people which translates into creation of jobs that would spur the continent’s development,” she said.
Acyl was on Wednesday addressing the media on the AU’s Trade and Industry Agenda as a catalyst for Africa’s development during the ongoing 27th African Union Summit at Kigali Convention Centre.
Acyl said there is also a need to examine the role of intra-Africa trade, noting that it is critical to make trade and industrial growth catalysts in Africa’s transformation agenda.
She also recalled that the AU Heads of State and Government adopted the African Mining Vision (AMV) in February 2009, with a view to making the mining sector more responsive to Africa’s economic and social development needs.
With regard to boosting intra-Africa trade and building a continent wide free trade area, the commissioner stated that African leaders launched negotiations in June 2015 which are expected to conclude in 2017.
“A continental free trade area, which will create a single market for goods and services of over a billion people and a GDP of over $3 trillion provides a good reason to invest and partner in Africa,” she said.
Continental free trade area
Last year, at the 25th Summit of the African Union (AU) in South Africa, African Heads of State and Government agreed to create the Continental Free Trade Area (CFTA) by 2017 through negotiations on liberalisation of trade in goods and services. The initiative is part of the AU summit agenda that African leaders are discussing. The Heads of State and Government and the high-level African trade committee, including the trade ministers and ambassadors, are also expected to deliberate on what opportunities are presented by this initiative, and how it can improve intra-African trade.
If implemented, the free trade area will enable members realise their potential to expand and accelerate their dynamism, especially increasing trade among African countries by 50 per cent by 2022. The continent’s GDP is also estimated to rise from $1.7 trillion in 2010 to $2.6 trillion in 2020, which is expected to push up consumer spending from $860 billion in 2010 to $1.4 trillion in 2020, according to AU’s trade and industry department.
Acyl said the continent is looking to this ambitious initiative to address issues like trade in goods and services, as well as competition and investment policies, among others. “The CFTA, therefore, offers African producers and investors a unique opportunity to exploit this huge market it presents,” said the commissioner.
Acyl, however, said there is a need for African industry players to increase production to satisfy demand, noting that CFTA will dismantle trade barriers and help reduce cost of doing business while engaged in intra-African trade, as well as boost productivity and competitiveness.
Intra-African trade currently stands at 12 per cent compared to 70 per cent for Europe, 50 per cent for Asia, or 21 per cent of Latin America.
Source: The New Times