The New Year 2021 begins with good news as the almost six-year-long negotiations on establishing an Africa-wide Free Trade Zone dubbed AfCFTA – similar to the EU – have finally led to an agreement, which will create the world’s largest Free Trade Zone.
55 countries (all African countries except for Eritrea, which seeks to protect its large local trade market) with 1.2bn people will be able to profit from a unique free trade zone reaching every corner of the continent. In the beginning, cross-border customs duties will be lowered and alter completely abolished with the aim to create a continental duty-free zone.
The African Free Trade Zone will be fully operational by 2030 and empowered by 55 GDP’s totalling 2.5 trillion US Dollars. While last year the inner-African trade has dropped by almost 15%, the new accord signed by all countries except Eritrea and ratified already by more than half could increase the trade by more 20% to the tune of 230bn US Dollars as soon as 2022, a needed boost to overcome the consequences of the Coronavirus Pandemic.