Nigeria, others urged to invest in infrastructure to accelerate AfCFTA implementation
Nigeria and Africa must promote supportive policies and infrastructure development to attract green investments and boost trade through the African Continental Free Trade Area (AfCFTA), the Acting Executive Secretary of the Economic Commission for Africa, Antonio Pedro, has said.
“To reap the AfCFTA opportunities we must address Africa’s infrastructure gap,” he told participants at the Africa Regional Session of the 12th Annual Investment Meeting, adding that, to attract sustainable cross-border investments to Africa, hard and soft infrastructure must be addressed.
The theme of the Africa Regional Session was, ‘The AfCFTA Investment Protocol – An Investment Paradigm Shift for Africa’ which set out to discuss the role of the AfCFTA and its Investment Protocol to create a new framework for attracting sustainable and productive investments in the continent and the investment opportunities that are arising as a result of that.
Pedro decried the lack of policy space to pursue the structural transformation agenda in Africa, saying, “It is not because of the lack of blueprints.” He called on African countries to support the implementation of the AfCFTA with “harmonised continental, regional and national trade and industrial policies that will help move from ideas into action”.
The AfCFTA was established in 2019 and constitutes a single continental market with a population of about 1.3 billion people and a combined Gross Domestic Product (GDP) of approximately US$ 2.5 trillion. At its full realisation, the AfCFTA, with the mandate of eliminating trade barriers, will be the largest free trade area in the world bringing together 54 countries.
The AfCFTA and the Programme for Infrastructure Development in Africa (PIDA) of the African Union will help deepen regional integration and build regional value chains he noted, highlighting the importance of building beyond Africa’s comparative advantage of resource endowment and low costs.
“We need to invest in science, technology and innovation (STI) to stay competitive in the long run and build Regional Value Chains (RVCs) that can generate more value added to increase the market share of African businesses,” he said, adding that Africa can leverage its natural resources to create sustainable regional value chains such as the battery and electric vehicles value chain in the Democratic Republic of Congo (DRC) and Zambia.
“Green industries are important for Africa’s competitiveness in future net-zero carbon markets,” he added. He underscored that an African Carbon Market presents a viable structural approach to attract sustainable investment opportunities that can drive the continent’s green growth ambition.
Speaking, Nigeria’s Minister of State for Industry, Trade and Investment, Mariam Yalwaji Katagum, emphasised the need to reinvigorate national trade institutions to ensure the inclusive and sustainable implementation of AfCFTA.
“For AfCFTA to become an active instrument of change, finance is needed to build the capacity of the private sector and build the necessary infrastructure to connect trade paths on the continent,” she said.
AfCFTA Secretariat Director, Emily Mburu, added that AfCFTA’s potential could be unlocked by freeing the movement of people across the continent to upgrade industries and leverage the diversification of other African countries.
Initiatives to ensure its successful implementation were highlighted such as the Pan-African Payment and Settlement System, a payment system that will enable cross-border traders to trade in local currencies and the AfCFTA Adjustment Fund to compensate for tariff revenue losses and finance diversification opportunities under the AfCFTA.