Egyptian Minister of International Cooperation Rania Al-Mashat said activating the African Continental Free Trade Area (AfCFTA) is integral to achieving sustainable development.
Africa should capitalize on this agreement to strengthen joint cooperation among African countries, increase private sector engagement, facilitate restructuring of regulatory laws and strengthen electronic commerce, she added.
Al-Mashat’s remarks came during a roundtable, titled “Africa in the Age of New Trade Wars,” which took place at the African CEO Forum held from 28 to September 30. This happened with the participation of several high-level speakers, including Mauritanian Prime Minister Mohamed Ould Bilal and Director General of the International Finance Corporation (IFC) Makhtar Diop.
Al-Mashat said that before COVID-19, the world had already taken precautionary decisions, which consequently impacted the mobility of international trade, pointing out that when the pandemic struck in early 2020, it imposed more restrictions on international trade, causing an increase in the cost of international trade, which in turn harmed consumers and raised prices. This is in addition to the negative effects of competition and productivity in developing and developed countries.
The minister further clarified that the pandemic has helped change many global systems, standards and rules; highlight new challenges, including climate change, the global need for equality and the risks of migration. She stressed that addressing these challenges requires a focused global and collective effort.
In addition, the Minister expressed that the economic repercussions of the COVID-19 pandemic are still not clear and that its exact impact is unknown; referring to the expectations of the International Monetary Fund (IMF) that the global economy is expected to contract by 5.2% this year due to the negative impact of the pandemic. Not only that, Al-Mashat also noted that African countries are most affected by the negative repercussions of the pandemic, as they are more dependent on imports when it comes to medical supplies and basic goods.
She further clarified that the AfCFTA, which is the largest in the world, has the potential to open horizons for the expansion of the African economy and to be a model of multilateral cooperation and international trade. It should be noted that exports between African countries in 2017 accounted for 16.6% of world exports, compared to 68% in Europe and 59% in Asia, which underlines the immense untapped potential of Africa.
“The creation of the AfCFTA aims to strengthen African economies, which encompass 1.3 billion people, with a GDP of 3.4 billion dollars. This could be the driving force of the continent for a sustainable recovery and inclusive growth to help Africa overcome the repercussions of the pandemic, ”Al-Mashat said.
Al-Mashat also said that despite the challenges that may prevent the establishment of the African Continental Free Trade Area, such as weak infrastructure and logistical constraints, it is by leveraging e-commerce and the transformation digital region that it becomes possible to overcome these challenges. .
According to the World Bank, the African Continental Free Trade Area (AfCFTA) presents a major opportunity for African countries to lift 68 million people out of extreme poverty; those who live on less than $ 5.50 a day. It also plays a role in improving the competitiveness of economies, boosting productivity and achieving sustainable and inclusive growth, and most importantly, it is the key to improving the livelihoods of 30 million people. Africans.
Concluding this discussion, the Minister addressed the key measures taken by Egypt to strengthen the participation of the private sector in the development agenda, in addition to strengthening its role in the integration of African countries by launching a business to ensure the risks of exports to the continent. One of the main steps taken towards achieving continental integration is the activation of the Cairo-Cape Town road.