Private sector participation, government support crucial for Africa to harness AfCFTA benefits

As countries participate in the African Continental Free Trade Area (AfCFTA), active private sector participation is pivotal, which should be sustained with enabling policies and support from the government

This was discussed at the Lighting of the Africa Trade Torch organized by the African Business Council themed ‘From Cairo to Cape, from Lagos to Mombasa, and from Dakar to Dar es Salaam for economic empowerment of African private sector, operationalization and popularization of the Africa continental free trade area, boosting our intra Africa trade and promoting made in Africa products’ held in Cairo.

Wamkele Mene, secretary-general, AfCFTA secretariat, said in Africa, the private sector accounts for 80 percent of the total production activities and that 90 percent of the firms within the African private sector are micro, small, and medium enterprises (MSMEs).

“To successfully implement the trade agreement, all member states must actively engage with the private sector, allow them to share their experiences, and also find a solution to challenges that hinder business activities,” he said.

Highlighting achievements made so far since the trade agreement commenced January 2021, Mene said the launch of the Pan-African Payments and Settlement System (PAPSS) has helped to ease monetary exchanges between countries, adding that the cost of unmatched currency had cost the continent $5 billion annually overtime.

He added that this also helped the continent reduce its reliance on foreign currency.

Similarly, Niyi Adebayo, Nigeria’s minister for Industry, Trade, and Investment, said AfCFTA cannot be effectively implemented without key inputs from the private sector, seeing that they have the sole power to operationalize the agreement as key drivers of economies within the continent and beyond

“The effects of the AfCFTA on economic and social transformation depends on the degree to which the private sector can seize the opportunities the agreement provides; however for the private sector to succeed, we need entrepreneurial states with governments that would assume regulatory, coordinating and catalytic roles,” he said.

Hence he said African governments need to promote trade development by investing heavily in large-scale innovations and technology that would drive economic success.

This he believed will make African economies more competitive while enabling development and elevation of regional value chains with focus on SMEs.

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“With Governments at the driver’s seat and the Private Sector as the engines, AfCFTA can set Africa on the path towards economic and social transformation, build an Africa of the 21st Century that would take its rightful place in global value chains and thus create “the Africa We want,” he said.

Mansur Ahmed, interim president of the newly formed Pan African Manufacturers Association (PAMA), said the association has intensified efforts to encourage cooperation between African manufacturers such that there can be market transformation in order to grow SMEs and subsequently create value chains to achieve Africa’s industrialization agenda.

“it is time to herald a new era where African products will be on every shelf, in every supermarket and market, consumed in every household across the continent and it is our duty to change the view that Africa is a continent of consumers and not producers,” he said.

Mansur, who is also the president, Manufacturers Association of Nigeria (MAN), reiterated PAMA’s commitment to advancing and prospering the efforts of the AfCFTA in order to build high quality continental value chains and also boost greater cooperation between manufacturers and countries in the African continent.

Albert Muchanga, Commissioner for Trade and Industry of the African Union Commission encouraged the private sector particularly the Micro, Small and Medium enterprises (MSMEs) to take strategic positions and effectively utilize the trade platform for regionals and global expansion.

He warned that the trade agreement has received so much attention from the international space who are eyeing an available market of 1.2 billion people, among other opportunities.

“AfCFTA has shaped a large and growing market which will attract foreign investors, local players must align with each other and the government to make the benefit sustainably from the agreement,” he said.

He assured stakeholders that soon, the criteria for made in Africa goods will be fully implemented, while efforts are intensified to leverage the trade platform for market certainty and to boost the local supply chain.

Amany Asfour, Chairperson, African Business Council, said the AfCFTA can be leveraged as a platform to create the kind of boom the African economy desires while it promotes the made in Africa products.

“Forging ahead, there is a need to link the continent with the industrialization agenda while the private sector receives support from the government through financial aid, enabling policies, and increased patronage,” she said.