Continental Free Trade Area (AfCTA) will open up markets for Malawi’s goods and services within regional trading blocs and Africa as a whole.
The ministers—Henry Mussa of Industry, Trade and Tourism and Emmanuel Fabiano of Foreign Affairs and International Cooperation—told journalists in Lilongwe that the launch of AfCTA in Kigali, Rwanda last week, is a major step towards regional and continental cooperation.
Mussa said the AfCTA instrument was opened for signature and ratification by member States together with the protocol on the treaty establishing the African Economic Community relating to the free movement of persons, right of residence and right of establishment that was already adopted by the African Union (AU) assembly in January 2018 in Ethiopia.
He said: “A total of 44 countries signed the AfCTA agreement, 30 countries signed the protocol to the treaty establishing the African Economic Community relating to free movement of persons, right of residence and right of establishment and 47 countries signed the Kigali Declaration.
“The AfCTA would increase intra-African trade resulting in an increase in African manufacturing exports within Africa and beyond. The growth of the manufacturing sector would lead to job creation, especially for the youth who form 70 percent of the sub-Saharan Africa population.”
Fabiano said the AfCTA is expected to bring together 55 African countries with a combined population of more than 1.2 billion people, including a growing middle class and a combined gross domestic product (GDP) of more than $3.4 trillion.
According to the Trade and Law Centre (Tralac)—a capacity building organisation developing trade-related capacity in East and Southern Africa—the key objective of the AfCFTA is to boost intra-African trade and it will do so by forging a single continental legal regime for all relevant trade disciplines.
Reads a write-up from Tralac: “This will include lower tariffs, simplified rules of origin and customs procedures, regulations for trade in services and remedies available to affected private parties.
“This is a bold vision but vital for advancing Africa’s economic development and capacity to integrate more effectively into the 21st century global economy.”
But Tralac says there is still a lot of work to be done before the full arrangement will be in place, but said it is an important step in the right direction.
It said protocols on investment, competition and intellectual property are still to be negotiated, in the second phase of this initiative.
Among other benefits the AFCTA will also ease travel requirements, help in harmonisation of systems, economies of scale, improve on value chain and attraction of foreign direct investment and infrastructure development.