Africa Day 2023: Accelerating implementation of the AFCFTA

To celebrate Africa Day on 25 May we focus on the African Union's theme of the year for 2023 – accelerating the implementation of the African Continental Free Trade Area to bring greater prosperity to the continent.

Africa Day is an annual celebration of the achievements and potential of the African continent which is celebrated in Africa and countries round the world. Its date – May 25 – commemorates the founding of the Organisation of African Unity (OAU), the precursor of the current African Union. This year marks the 60th anniversary of the signature of its founding charter in Addis Ababa, Ethiopia.

The African Union (AU) has chosen “Acceleration of AFCFTA implementation” as its theme for 2023. The AFCFTA (African Continental Free Trade Area) is an ambitious trade pact aimed at creating a single market for goods and services of almost 1.3bn people across Africa and deepening the economic integration of the continent.

Trade integration across Africa has long been limited by outdated infrastructure and differing regulations across dozens of markets. Intra-african exports were 16.6% of total exports in 2017, compared with 68.1% in Europe, 59.4% in Asia, 55% in America and 7% in Oceania. When fully implemented, the AFCFTA will be the world’s biggest largest free trade area, with a combined gross domestic product of around $3.4 trillion. Fiftyfour of the continent’s 55 countries are signatories to its founding agreement.

REAL INCOME GAINS

The AFCFTA is projected not only to lead to job creation, poverty alleviation, improved welfare and sustainable development but also to ensure inclusivity for women and youth, development of small and medium enterprises (SMES) and overall industrialisation of the continent, guided by Agenda 2063, the AU’S master plan for transforming Africa into the global powerhouse of the future.

The World Bank has estimated that by 2035, real income gains from full implementation of the AFCFTA could be nearly $450bn. It has also suggested that Africa could see a rise in foreign direct investment by up to 159%, and a rise in exports to the rest of the world of 32%, while intra-african exports could grow by 109%, led by manufactured goods.

TURNING VISION INTO REALITY

Limited trading under the AFCFTA began in January 2021, but achieving its full potential depends on significant policy reforms and trade facilitation measures across the signatory nations, for which negotiations are still ongoing.

In order to turn this vision into reality, the main objective of the AU’S designated theme is to secure the commitment of all stakeholders to speed up the implementation of the AFCFTA in 2023 and fast-track the overall economic integration of agenda of the continent.

“The Theme of the Year and its mandate to support the implementation of the AFCFTA Agreement will aim to be celebrated through close collaboration with all relevant organs and specialized agencies of the African Union, regional mechanisms and Regional Economic Communities (RECS), in line with their respective mandates to fast track the implementation of the AFCFTA for the benefit of Africa’s population,” says the African Union.

Africa Collective participated in two key events in South Africa: the South African Investment Conference 2023 and the African Continental Free Trade Area Business Forum. The events provided opportunities for the team to connect with key partners and stakeholders from across the African continent and ramp up efforts for the WEF Davos 2024. Africa Collective will also be present at the Africa CEO Forum in Abidjan, Côte d’ivoire in June 2023.

Africa Collective participated in two key events in South Africa. The South African Investment Conference 2023 (SAIC) took place in Johannesburg on 13 April, bringing together senior executives, representing the largest South African and international companies based in the country. This event was a great opportunity for the Africa Collective team to meet with key partners. Following SAIC 2013, Africa Collective attended the firstever African Continental Free Trade Area (AFCFTA) Business Forum organized by the AFCFTA Secretariat from 16-18 April in Cape Town. The Business Forum brought together more than 1000 participants from across the African continent and Africa Collective connected with pan-african and global stakeholders to ramp up its efforts on the sidelines of WEF Davos 2024. The team was also present at a healthcare focused event organized on the sidelines of the AFCFTA Business Forum by the SwissAfrican Business Circle.