PREVIEW
A little-known Nigerian firm has won a 20-year, $3.1bn concession to digitise trade across 50 countries – the biggest test of the continental free trade area
The Secretariat of the African Continental Free Trade Area’s (ACFTA) signing of a 20-year, US$3.1 billion concession agreement with Nigeria’s Bergmans Security Consultants and Supplies Ltd to roll out a continent-wide customs system is being hailed as a giant step to making a cohesive continental trade bloc a reality.
Sceptics point out that regional trade blocs still operate a multitude of tariff regimes, often overlapping within the same country. AfCFTA's target of lifting intra-African trade to 25% of the total by 2035 will depend on a harmonisation that no customs software can enforce on its own. It raises the question of whether political will catch up with Bergman’s hi-tech systems within the 20-year concession.
Bergmans is to launch systems that digitise customs processes, standardise cross-border procedures and provide real-time tracking of goods across the continent.
On 6 August, AfCFTA Secretary-General Wamkele Mene said that manual customs systems contribute to corruption, inefficiency and lost revenue. Launched in January 2021 with the support of 50 African states, the ACFTA is making only slow progress.
African Union officials say that AfCFTA makes 90% of goods eligible for tariff-free trade; they forecast the pact could boost intra-Africa trade by 33% (Dispatches, 1/2/23, Governance survey argues that slow trade reform and 'democratic backsliding' are hampering progress). Harmonising standards and regulations on goods trade is vital to boost intra-African trade and curb revenue leakages (AC Vol 64 No 2, Grand ambitions, little money).
Intra-African trade rose to $220bn in 2024, up from $193bn the previous year according to data from Afreximbank, accounting for around 15% of total trade. That compares with approximately 60%, 40 %, 30% intra-regional trade for the European Union, North American Free Trade Agreement and the 11 country Association of Southeast Asian Nations.
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