African Trade Fair 2021: ‘Africa open for business,’ says Ramaphosa

Economists have lauded the five-day Intra African Trade Fair 2021 – officially opened by President Cyril Ramaphosa in Durban on Monday – as a significant step “towards reviving the African Continental Free Trade Area (AfCFTA) from losing momentum”.

This despite AfCFTA having not gone far enough to ignite the much-anticipated intra-trade and economic growth in Africa.

Trade in Africa

‘Unemployment negative role’

Leading economist Mike Schussler said AfCFTA was about the movement of goods and people.

“It is about tourism and transport services that can be delivered”.

“In terms of what has gone wrong, I think huge unemployment has played a negative role and this needs to be countered on the ground,” he said.

“The AU (African Union) initiative is currently under pressure – you have Botswana making laws about its truck drivers, with only the Botswana citizens allowed to start businesses in that country.”

Schussler said the same goes for Zambia and Zimbabwe.

“We have to loosen our border controls quite a lot more,” he said.

Creating one of the largest free trade areas

University of Johannesburg economics associate professor of economics Peter Baur said AfCFTA was set to create one of the largest free trade areas globally.

“It is estimated that this agreement will connect 1.3 billion people with a possible combined gross domestic product (GDP) valued at $3.4 trillion or about R51.7 trillion,” said Baur.

“In essence, it’s not about the SADC (Southern African Development Community), the AU or other trade agreements having failed, it’s just that they did not clearly speak to each other.

“A trade relationship in the SADC would often create trade conflicts with other trade blocks. Given the large number of different trade block agreements, structures and rules across Africa, it was bureaucracy and, possibly, was logistically very difficult to navigate – especially for the business sector.”

Baur added that this does not mean Africa will set prices or dictate policy, “but collectively, through better negotiations, will be in a position to manage environmental factors better”.

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African Trade Fair 2021

Ramaphosa’s opening address

In his opening address, Ramaphosa said on 1 January, the AfCFTA started trading, “making this Trade Fair the first to take place since we reached the most significant milestone in our quest for African economic integration”.

He said: “The AfCFTA aspires to connect all the regions of Africa, to deepen economic integration and to boost intra-African trade and investment. It aspires to create a single market for goods and services across 55 countries and our continent, creating a market of as much as 1.3 billion people.”

Ramaphosa said this year’s trade fair is about building bridges. “It brings together governments, buyers, investors, entrepreneurs and manufacturers from more than 55 countries to give life to the African Continental Free Trade Area.”

‘Africa open for business’

He said Africa was open for business. “Since ancient times, trade has been the engine that connected communities both near and far,” he said.

“From the ancient centres of learning like Alexandria and Timbuktu; to the northern civilisations in Egypt and Carthage; the western kingdoms of Ghana, Mali and Songhai; the trans-Saharan trade routes; the eastern trading centres of Zanzibar, Mombasa and Mogadishu; to the ancient southern civilisations of Great Zimbabwe and Mapungubwe, for many centuries Africans traded goods they produced.

“Throughout history, Africa has had a network of trade routes that facilitated the flow of goods such as beads, carvings, ivory, gold, gum, metal works, salt, textiles and metals. These routes enabled African traders to seek out markets beyond the continent.”

He said colonialism “deeply damaged the indigenous development of African trade and caused great harm to our societies”.

– brians@citizen.co.za