ALPHA welcomes the establishment of the African Continental Free Trade Area

23 May, 2018

The announcement that a free trade agreement had been signed in Kingali, Ruanda last month is very welcome news for ALPHA’s corporate members and partners.

Free trade on the continent of Africa offers enormous advantages for international logistics professionals operating or providing products and services across the continent.

Increased intra-regional commerce will deliver many benefits and opportunities for African nations. This latest initiative has the capacity to accelerate a trend that is already in place, as from a very low base, intra-African trade has been growing steadily since 1990, helping to bring about the beginning of a reversal of Africa’s colonial legacy, which had seen the continent predominantly involved in exporting raw materials and importing manufactured goods.

Tariff-free trade will encourage the development of enhanced infrastructure to facilitate heightened local trading levels and can also transform border crossings and customs regulations. The establishment of a ‘one-stop’ border between Kenya and Uganda in 2016 has already demonstrated how the flow of trade can be transformed between nations through such an initiative.

A total of 44 nations signed the agreement to establish the African Continental Free Trade Area. This means that eleven African nations, including the continent’s two biggest economies, Nigeria and South Africa have not signed, but free trade advocates are still optimistic about the concept being adopted throughout Africa in the longer term.

By increasing the level of trade between African countries there will be an opportunity to move up the value chain, to produce more affordable products and ultimately to increase prosperity levels.

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