In July 2019, the African Union launched the operational phase of the African Continental Free Trade Area (AfCFTA) at a summit in Niger. Countries had signed the framework agreement for the AfCFTA on 21 March 2018 and last April 22 countries (the number required for the agreement to come into force) had deposited their instruments of ratification. With a combined market of over 1.2 billion people and a GDP of $2.5 trillion, AfCFTA could potentially make Africa the largest free trade area in the world. The United Nations support for the African Union during negotiations and ratifications was led by Vera Songwe, the Executive Secretary of the UN Economic Commission for Africa (ECA). For Africa Renewal, Christabel Ligami interviewed Ms. Songwe about AfCFTA's implementation phase, empowering African women and her vision for the ECA. The following are the excerpts.
Africa Renewal: Now that AfCFTA is in force, do you think countries will fully implement the agreement and within the set timelines?
Vera Songwe: It's a good thing that some countries are moving a step ahead. It shows how trade is important to African countries and that countries are ready to open their borders. So yes, we are hopeful countries will fully implement the agreement. Countries are realizing they need to trade more with others because of an expected increase in revenues and jobs creation, especially for the youth. Intra-African trade is expected to rise to 53.3 %, meaning that revenues will increase.
How can member states ensure that the agreement is fully implemented?
Ministers of finance of member states signing on to AfCFTA have an important role to play to help countries implement the agreement. Tax and customs, for example, which are key components of AfCFTA, are matters under the ministry of finance. It's up to the finance ministers to evaluate if, how and when revenues will increase for their countries and how these revenues will be expended. Once countries ratify the document, they have 10 years, some have 13 years, to put key policies in place to fully take advantage of AfCFTA.
We expect countries to carry out a review of their macroeconomic policies, focusing on fiscal policies that are fit for purpose, and to help us not only to adapt to, and make the most of, AfCFTA, but more broadly to achieve Agenda 2063 and the 2030 Agenda for Sustainable Development. The urgent action is to create the enabling fiscal space to foster both public and private investment while...