Future looks bright as African nations set aside old rivalry

THE countries within the African continent are on the verge of entering into a new deal for free trade, which will hopefully be the spur that drives the continent into realising the potential that has always existed within Africa.

Since the roll-back of the colonial tide in Africa, cohesion between the African countries left behind has been difficult due to rivalries between nations and political divides some of which have never been reconciled.

However, in recent times China has focused in on the African continent with the view to gaining access to the rich resources of the African continent. Over 80per cent of Africa’s exports are shipped overseas, mainly to the European Union (EU), China and the US. This new free trade deal has a very original name being ‘’The African Continental Free Trade Area’’ (“AfCFTA”).

With the backdrop of Brexit, will this give the UK, with its historic links in the African continent, an opportunity to find many new trading partners sitting within one trading block?

The purpose of AfCFTA in their words is to “Accelerate intra-African trade and boost Africa’s trading position in the global market by strengthening Africa’s common voice and policy space in global trade negotiations.”

Nigeria has just joined AfCFTA, along with South Africa. This means that the largest nation in Africa and its most developed nation are now part of AfCFTA, making up 52 out of the 54 nations in Africa, giving access to a population of over 1.25 billion people.

It is hoped that in time when

AfCFTA has completed the operational phase it will be a formidable force on the basis that it will be the largest free trade area in the world allowing intraregional trade between the African nations to grow from around the existing 15per cent to maybe replicate the figures between the countries in North America which is currently about 40per cent and in Western Europe which is about 60per cent. AfCFTA will obviate the need for VISAs and break down barriers of trade.

There will always be barriers to trade, though I do appreciate there will be tough negotiations trying to agree and adopt common standards, but if countries like Nigeria can put aside their concerns about being a dumping ground for other low-cost African nations, there will be a bright future for AfCFTA.

Colin Rodrigues is head of the corporate team at Hawkins Hatton