By Ivan Nganwa
Representatives of 44 African nations signed an agreement Wednesday to set up a free trade area that is expected to boost trade on the continent.
The agreement to create the African Continental Free Trade Area (AfCFTA), which was signed at an extraordinary summit in Kigali, Rwanda, commits governments to remove tariffs on 90 percent of African goods and phase out the rest later.
This means that traders and consumers from member states will no longer pay tariffs on a large variety of goods that they trade amongst themselves.
The AfCFTA will make Africa the world’s largest free trade area created in terms of the number of participating countries since the World Trade Organization was formed in 1995.
Notable absentees who declined to sign the agreement are Nigeria – which says it “needs more time” to first consult with its private sector – and Burundi, which said it was concerned over the security of its delegates due to a longstanding frosty relationship with Rwanda.
Other absentees were Namibia, Sierra Leone and Eritrea.
However, they still have an opportunity to sign the agreement within 180 days, considering that ratification by individual governments is now expected to proceed following today’s signing ceremony.
“The promise of free trade and free movement is prosperity for all Africans because we are prioritizing the production of value-added goods and services that are made in Africa,” said AU Chairman and Rwandan President Paul Kagame.
“The advantages we gain by creating one African market will also benefit our trading partners around the world.”
Intra-African trade accounts for around 16 percent of the continent’s total, according to statistics from the African Union, which could increase by half with the AfCFTA.