African leaders and businessmen on Wednesday met up at Rwanda to sign a historic trade deal called African Continental Free Trade Area (AFCTA). African Union started talks on a trade deal between all African nations in 2015 to establish a 55-nation bloc, one that would be the biggest in the world by member states, in an attempt to increase intra-regional trade, and economic relationships as well as opportunities between African nations, with Africa’s intra-regional trade a measly 15 percent of Africa’s total commerce. Rwandan president Paul Kagame, was the host of the AU summit, he concluded the initial negotiations and declared the meeting a success after 44 African nations signed up to create a free trade bloc within 18 months. The trade bloc needed a minimum of 22 countries to make the project valid, Paul Kagame applauds the members who have joined.
The establishment of the trade bloc will allow access to goods, services, and trade between African nations thereby increasing commerce and reducing the dependency we have on foreign trade. In order for the system to work, all African countries involved have to cooperate, “If they just sign the agreement without opening the borders, without getting rid of non-tariff barriers and if they don’t work on the free movement of people, it is not going to work,” analyst Kottoh shared with EuroNews
However, two of Africa’s biggest economies Nigeria & South Africa have refused to sign up to the bloc, with reasons unknown as to why these two countries opted out. This is a big blow to the bloc as these two countries have both a large population and fast-growing private sectors respectively, “If Nigeria does not join, it will have an impact definitely. Nigeria is 190 million population country, it’s a large economy. Like I was telling you, we happen to have Aliko Dangote who is African’s richest man, and is co-chair of the Afro champions. So we hope that Nigeria will not pull out of it. Nigeria had already been part of the process of building it, we think it’s just maybe one step back that they are taking to review. My understanding is that they want to review again some aspect of the AfCFTA,” said one economic economist Alpha Sy.
Members of the summit await the two nations to complete their review as they prep up for the trade bloc which will have effect in the months to come.