The newly launched African Continental Free Trade Area, a new intra-Africa regional bloc which will help to expand its trade reach on the continent, is a positive step toward expanding trade, experts on international affairs have concurred.
Fifty-four of the 55 African Union member countries had signed the deal which was launched in Niger on Sunday.
Eritrea was the only country still out of the deal.
South Africa signed earlier after holding out briefly so as to seek legal advice and consult widely around the implications of the deal to the country.
The agreement made Africa the world’s largest free trade area as the majority of its countries came together to create a single market of 1.2 billion people with a combined GDP of $2.5 trillion (R35.3 trillion).
Siphamandla Zondi, professor and head of the political sciences department at the University of Pretoria, said SA companies, both big and small, should brace themselves for trade expansions as the agreement would open new markets in the rest of Africa, and vice versa.
“[This] has the potential of opening South Africa and its fellow signatories to an almost billion people market that is worth R3 trillion,” Zondi said.
There would be huge trade opportunities across the continent for South African businesses across all industries.
“South African businesses had been penetrating this market for some time which created the notion of an SA Incorporated in the continent,” Zondi added.
He cited the fact that the country had a huge trade and investment footprint on the continent in sectors such as mining, telecoms, financial services, infrastructure, professional and personal services and retail, which is the biggest investment area by SA in Africa.
The trucking and logistics sectors had been growing over the past several years and with the new trade arrangement, these sectors were likely to grow faster.