Free Trade Zones

EDITORIAL: Businesses must boldly venture beyond borders | New times


The value Rwanda’s exports to the African continent are expected to triple in 10 years, against 1.6 billion Rwf, in part thanks to the African Continental Free Trade Area (AfCFTA).

One of the largest free trade zones in the world, the AfCTA started the negotiation phase in January, effectively paving the way for the continent to benefit from its $ 4 trillion market.

The AfCFTA is expected to promote industrialization and competitiveness, as well as create millions of jobs across the continent. It is also hoped that it will trigger regional value chains that could facilitate Africa’s meaningful integration into the global economy.

Signed in Kigali in March 2018, the agreement establishing the AfCFTA is probably the most important milestone of any generation of African leaders since the 1960s, when most countries on the continent gained independence.

For decades, African economies remained fragmented with small, largely unsustainable and underdeveloped markets, a situation that greatly benefited former colonizers and other industrialized countries.

Yet the AfCFTA could remain largely on paper if the private sector does not fully embrace it and start to profit from it.

This is partly due to structural barriers to cross-border trade.

However, African political and business leaders have so far demonstrated their willingness to address these challenges and create the necessary business-friendly environments to facilitate traders and investors seeking to exploit the AfCFTA.

One of the latest initiatives in this regard is the launch this week in East Africa of MANSA, a digital platform that provides a single primary source of data that enables required due diligence involving financial institutions, businesses, and more.

In addition to creating conditions for intra-African exporters to access financial facilities, the initiative is expected to help address concerns about financial crime and enhance transparency and ethical trading.

This has been described as a shift by players in the intra-African export market with regard to trade under the AfCFTA.

Indeed, it is essential that Rwandan and African businesses, in general, seize this opportunity, as well as other similar initiatives, to venture beyond their national borders with more confidence and determination, thus contributing to shaping a new Africa that the architects of the AfCFTA envisioned.

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