African Continental Free Trade Agreement (AfCFTA) was signed during the African Union Summit in Kigali, Rwanda on March 21, 2018. Uganda is part of this bloc. Focusing on the bloc’s modus operandi, the operational phase for AfCFTA was launched on Sunday, July 7 during the African Union summit in Niamey, Niger where Ghana was announced as the host of the trade zone’s headquarters.

Countries were required to ratify before bringing into force the trade framework, that is designed to free the continent of tariff barriers, bolster trade among African countries, drive industrialisation and create jobs. At present, 24 countries have submitted their instruments of AfCFTA ratification, including Uganda. Five others have also started the ratification process.

How Uganda stands to benefit from the world’s largest trading bloc

According to UNCTAD’s December 2018 report, more than 90 per cent of African countries are on the List of Least Developed Countries. AfCTA could be a silver lining for possible relief from predators that have continued to blackmail African economies unfairly through conditional debts, sanctions and other forms of exploitation.

Uganda’s commitment to be part of AfCFTA, which is a continentwide economic integration presents enormous opportunities for Ugandans as ensuing benefits for Africa will be immense. If all 55 African countries join a free trade area, it will be the world’s largest (going by the number of countries); covering more than 1.2 billion people and with a combined GDP of 52.5 trillion. It will be the world’s largest free trade area since the establishment of the World Trade Organisation (WTO) in 1994.

Tariff-free access to a huge and unified market will encourage manufacturers and service providers to leverage economies of scale; an increase in demand will instigate an increase in production, which in turn will lower unit costs. Consumers will pay less for products and services as businesses expand operations and create more jobs.

Source: Rwanda Today

Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of TradeMark Africa.