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The AfCFTA as a catalyst for Africa’s global economic repositioning

The AfCFTA as a catalyst for Africa’s global economic repositioning

By Tosin Arebuwa

On May 30, 2019, the agreement establishing the African Continental Free Trade Area (AfCFTA) entered into force after 24 member states had deposited their instruments of ratification. The policy aims to turn the fortunes of the African continent around through a free-market economic initiative. Presently, moving around and doing business in Africa is a very difficult exercise. To implement AfCFTA successfully, the chairperson of the African Union Commission, national governments, and other stakeholders must work on the ease of movement within the continent, establish a joint security organisation, and invest in modern transportation systems.

Read also: Manufacturers say tax burden threatening participation in AfCFTA

For African passport holders, travelling within the continent is difficult compared to other developed continents. According to a 2023 report by the African Development Bank, a visa is still required in 46 percent of travel scenarios on the continent. Seamless mobility within Africa should be a top priority for African leaders to achieve the objectives of the AfCFTA. African leaders and policymakers can enhance ease of movement by making travelling on the continent visa-free for Africans, as is the case for Europeans under the European Union’s visa policy. A visa-free Africa can be achieved by implementing crucial reforms in the visa procurement policies of African countries. One major reform to facilitate free movement should be reciprocal visa waivers across the continent. Although some African countries, such as Rwanda, have adopted the reciprocal visa waiver policy, all other African countries should adopt this policy for free travel within Africa. Such reforms will promote regional integration and boost the continent’s economy.

In Africa, insecurity is an existential crisis that has slowed down the development of the continent. For instance, the rise of insurgencies, banditry, and kidnappings in West Africa and the Sahel in recent times is unprecedented. Piracy and other forms of criminality in the Gulf of Guinea threaten regional peace, security, and development. Coups are also on the increase like never before. More so, insecurity has worsened continental peace and stability. Hence, the leadership of the African Union should establish a joint security organisation to enhance the peace and security of the continent. Having a well-funded security organisation like the North Atlantic Treaty Organisation (NATO) to combat terrorism will contribute greatly to the success of the AfCFTA. Funding for such a security outfit should come from a joint contribution by African countries. The contributed funds can be managed and properly dispensed by the Peace and Security Council of the African Union, as is done for NATO.

Currently, many African countries have poor public transportation systems, which make the movement of people and goods strenuous and hinder economic development. Most African countries only have 3 kilometres per 1,000 square kilometres of railway networks, in contrast to 400 kilometres in Europe. Investment, especially in rail transportation, will foster regional integration. Rail transportation can convey large volumes of goods, including heavy-duty equipment, and many people in one trip. Building modern transportation systems in Africa can be achieved through robust public-private partnerships between African countries and interested private entities. Such investment in modern transportation systems will enhance economic development on the continent.

Read also: How AU, AfCFTA failed to deliver local content for energy security

The AfCFTA can potentially lift 50 million people out of extreme poverty by 2035 and expand incomes by $571 billion. Successful implementation of the AfCFTA requires collective efforts from African leaders and other interested parties within and outside Africa. Such efforts must include visa-free movements for Africans within the continent, formidable security infrastructure, and affordable modern transportation systems. The development will propel the growth and expansion of businesses, especially micro, small, and medium enterprises (MSMEs), which are catalysts for economic sustainability.

Tosin Arebuwa is a writing fellow at African Liberty.