The Africa Confidential Blog
Africa's common market
The build-up was as impressive as the goal is ambitious. After three years of talks, Africa is to form a Free Trade area for 54 countries and over 1.2 billion people. All signatory countries are to cut tariffs and import quotas. That is to be followed by a customs union where each country has the same tariffs and then a common market where all trade among members is free of tariffs and quotas. It would be the biggest economic union since the foundation of the World Trade Organisation. And all at a time when the United States has raised tariffs to protect its steel industry and China is styling itself as a crusader for free trade and globalisation.
The script became reality in Kigali on 21 March when the leaders of 44 countries turned up to sign the Free Trade Agreement. African Union Chairman Moussa Faki Mahamat called it a 'glorious challenge' which demanded 'the courage to achieve.' That's all true. Trade within Africa makes up some 19% of the continent's commerce, and trade between countries in Asia is about 50% of the region's commerce. The UN's Economic Commission for Africa reckons the Kigali agreement could help double intra-African trade.
But there are still powerful sceptics in Africa. Nigeria pulled out from the signing in Kigali, citing concerns by local companies about dumping and trade unions about jobs. Uganda's President Yoweri Musevenistayed away too, but it's uncertain whether that was for diplomatic or economic motives.