Africa’s new free trade area: Opportunities for Kenya
It was described as a historic moment for Africa when leaders of 44 countries signed up to the African Continental Free Trade Area (AfCFTA) earlier in the year.
The deal comes with big ambitions: if fully implemented, it will create a single African market for goods and services, covering 1.2 billion people and a GDP of US$2.5tn across 55 member states of the African Union.
According to the African Union, the agreement has the potential to boost intra-African trade by 53% by eliminating import duties, and to double trade in the region if non-tariff barriers are also reduced.
However, a recent Moody’s report points to the lack of trade finance and other non-tariff barriers as limitations to the deal’s potential.
The African Development Bank has estimated that Africa has an unmet demand for trade finance of more than US$90bn annually.
Other barriers include corruption, ineffective customs documentation and broader procedural approaches.
Speaking to GTR in Nairobi, Adan Mohamed, cabinet secretary for Kenya’s ministry of industry, trade and cooperatives, explains where he sees AfCFTA bringing the biggest opportunities for Kenya, and what challenges the continent may face in its implementation. Find out more in the video.take me back