Ministers aim to boost African continental free trade area

African ministers of finance, planning and economic development gathered from 11-15 May in Addis Ababa to discuss the next steps in implementing the African Continental Free Trade Area (AfCFTA). “AfCFTA: Creating fiscal space for jobs and economic diversification” was the official theme of the ministerial conference’s 51st session. An agreement to establish the AfCFTA was signed by 44 African countries in Rwanda on 21 March 2018. While Ghana and Kenya are the first two countries that have ratified the documents, Nigeria and South Africa have yet to sign the agreement. They account for nearly one third of the continent’s GDP and more than 20% of its population. The AfCFTA will become effective once at least 22 countries have ratified it. But without the continent’s two economic giants, the agreement will be much less powerful. There are many other obstacles standing in the way of making the continental free trade area a reality including infrastructure gaps, the investment climate and administrative burdens. In many cases, it is currently more expensive to export goods within the continent than to outside countries. “The AfCFTA is a major milestone that will no doubt lead to a prosperous integrated Africa that is less dependent on outside sources for its well being,” acknowledged Moroccan economy and finance minister Mohamed Boussaid. Former AfDB president Donald Kaberuka called for African citizens to mobilise to boost the free trade area’s operationalisation. The ambitious continental initiative aims to create a regional common market to boost intra-African trade from its current level of 16% to 52% by 2022. It will also trigger job creation and economic diversification. The conference theme recalled the importance of accompanying the AfCFTA with taxation measures to support and fully take advantage of the free trade area while also strengthening fiscal sustainability in Africa. Other topics included agriculture’s role in economic growth, financing infrastructure, tackling illicit financial flows and an integrated strategy for the Sahel. The 5th African Governance Report, the Global Education Monitoring Report and the 2018 Assessing Regional Integration Report were launched on the sidelines of the event.