Nigeria, others suspend $3.4tr continental deal amid pandemic
The implementation of the African Continental Free Trade Agreement (AfCFTA), suffered yet another blow, with the announcement of its suspension, as African countries struggle to deal with the impact of the coronavirus pandemic.
With borders closed and supply chain disrupted globally, the trade deal expected to kick off in July was suspended to allow countries to deal with the pandemic.
The Secretary-General of AfCFTA, Wamkele Mene, said on Tuesday that implementation of the free trade agreement will not be able to commence on July 1, due to the disruptions occasioned by the coronavirus pandemic.
“It is obviously not possible to commence trade as we had intended on 1 July under the current circumstances,” Mene said but did not elaborate on whether there was a new planned date for the implementation.
Despite the setback, Mene was optimistic that the deal would eventually proceed, saying: “The political commitment remains, the political will remains to integrate Africa’s market and to implement the agreement as was intended.”
According to him, intra-African trade could help African countries get the ability to put together sizeable economic stimulus packages to help alleviate the economic devastation arising from the COVID-9 pandemic.
“That’s our stimulus package. That’s how we’re going to get back on track as Africa,” he said.
According to the United Nations Economic Commission for Africa, the AfCFTA is, by the number of participating countries, the largest trade agreement since the formation of the World Trade Organisation. Its implementation will form a $3.4 trillion economic bloc with 1.3 billion people across the continent.
Nigeria’s Lagos Chamber of Commerce and Industry (LCCI), and Manufacturers Association of Nigeria (MAN) had both raised concerns about the state of infrastructure in the country, citing it as a major bottleneck to implementation of the trade agreement.
Earlier, the Chair of African Union (AU) President Cyril Ramaphosa of South Africa, had noted that the continent’s domestic priorities – including economic transformation, job creation and the consolidation of the social wage through reliable and quality basic services, depend on a politically stable and economically growing Africa.
According to him, infrastructure is at the core of Africa’s social, economic and political challenges, as well as crucial for sustainable development and inclusive growth, and for diversification through industrialisation and value addition.
“We know that AfCFTA will only become a reality if the infrastructure between African countries is developed. Infrastructure is at the core of Africa’s social, economic and political challenges. It is crucial for sustainable development and inclusive growth, and for diversification through industrialisation and value addition.
“As the Champion of the Presidential Infrastructure Champion Initiative under NEPAD, South Africa has a critical role to play – and must act on the opportunity presented – in profiling infrastructure development in support of the AfCFTA.
“Together with our fellow African countries, we must implement the AfCFTA agreement with purpose and determination. We must undertake the detailed work, extensive consultation and complex negotiations required to give life to this agreement.
“In this regard, South Africa will work with President Issoufou of Niger, who is the AU Champion on Continental Economic Integration. This work is directed towards the social and economic development of the Continent, and the realisation of a prosperous Africa based on inclusive growth and sustainable development,” Ramaphosa added.