Chris BishopBy Chris Bishop|January 12, 2021|4 Minutes|In AfCFTA

AfCFTA

AfCFTA chief defiant in the face of world criticism.

The Secretary General of the African Continental Free Trade Area was in defiant mood as he defended the new trading regime against critics from around the world.

“We are not doing this to prove anything to anyone outside the continent – we are doing this because it in the interests of Africa to have an integrated market.”

These were the words from Wamkele Mene the South African born Secretary General of the AfCFTA as he stood by the fledgling trading block less than two weeks from its birth, on January 1, after five years of negotiation.

Mene spoke on Zoom from the AfCFTA headquarters in Accra, Ghana, in his first ever briefing on progress. He appeared stung by criticism from around the world on Africa’s attempt to double trade across the continent by 2035 and lift 100 million people out of poverty through more business and investment.

“I know that in some parts of the world we get criticism. We are criticised and told that we are rushing things. That we are actually not quite ready, but I want to ask those who hold that view: Tell me of a trade agreement where all countries are ready at the same time? I don’t know it. I have never heard of a trade agreement where in that particular arrangement every single country is ready on day one. Not to my knowledge, it doesn’t exist,” he said.

“And so, I regret, as Africans, we are held to a much, much, higher standard for how trade agreements should operate in practise…It took the European Union 60 years to get the depth of integration that it has.”

Mene admitted there were few African nations ready with their customs infrastructure to make freer trade happen and named only Ghana, South Africa and Egypt. He also said there had been a ceremony in Accra on January 4 to celebrate the first shipment of goods from Ghana to the continent.

A system of credit for tariff reductions for traders would operate in countries that were not ready, he said.

“This is not the reinvention of the wheel, we are using methods that were used in other trade agreements.”

The AfCFTA was also working with Afreximbank to set up a payment settlement platform that he hoped would be working in six months’ time and promised to take the dollar out of continental trade.

“When a trader in Ghana has to transact with a counterpart in Kenya, that Ghanaian exporter will be able to transfer funds in local currency who will receive the funds in Kenyan shillings. We have to reduce the cost of converting the currency to the dollar,” he said.

Mene also said that he was in talks with major banks to put together a billion-dollar fund to help entrepreneurs – largely the young and women – to do business in Africa.

“We cannot be in a situation where only the big organizations take advantage of this opportunity,” he said.