It has been announced that up to £35M will be given to support the implementation of Africa’s Continental Free Trade Area agreement. This multi-million-pound investment will not only assist with trading but also with policy creation and implementation. The agreement began at the beginning of January 2021, just after several African countries had come together in pursuit of making a united trade area. There are challenges that need to be resolved before trading can be fully functional; however, many companies and individuals believe they can resolve these challenges by working collectively and more efficiently.
Under a free trade system, imports and exports are less complicated as the government does not aim to limit or stop trading goods in or out of the country. In accordance with the African Initiative, over 1.3 billion people across 54 countries will be able to connect globally once they have been connected worldwide via a free trade platform, according to the Institute of Export and International Trade.
The free trade agreement is set to benefit over 30 million people across both Africa and the UK in a variety of ways. An investment like this will boost the economy, reduce poverty, provide new jobs and create commercial opportunities between our two continents. As the world’s largest trading block in terms of total area, with more than 40% of the world’s population on board and £47 billion traded in goods and services every week – what is there to lose?
Trade integration across Africa is limited by outdated border and transportation infrastructure. Countries erect trade barriers to protect their markets from regional competition. This makes it harder for countries to trade with nearby neighbours than with faraway ones. African countries export fewer goods to each other than they import. African countries depend on the rest of the World for most of their exports. The African Commissioner of Infrastructure aims to connect the African capitals using high-speed rails to assist and support the moving of products and people. This will reduce transport costs, support workers to move around and reduce congestion on African roads.
The African continent has made great strides in the last decade, with developed economies such as South Africa and Nigeria, and the emerging markets of Kenya, Ghana, and Tanzania, making substantial progress. The benefits of Africa’s free trade initiative to the UK are clear, with the UK already being a significant trading partner with many African countries. Now that the UK has formally ratified the African Continental Free Trade Area (AfCFTA), there is much to be gained from increased free trade within the continent and with the UK.
Africa is a land of enormous potential, and the United Kingdom is ready to help the continent benefit more from world trade. The UK is part of a 54 – country initiative (The African Free Trade Initiative), encouraging international trade between member countries and promoting economic growth throughout Africa. This project is vital in laying the groundwork for future growth. It aims to remove barriers to market access and raise awareness among nations on how they can benefit most from global partnerships and trade networks.
By creating a single continental market, trading barriers to market access are removed, and trading will become more accessible and profitable. The UK will be able to trade freely with all 54 member counties of Africa’s Free Trade initiative. The UK strongly supports the free trade initiative, particularly since Brexit. The UK is an independent free-trade nation and would be ideally placed to export goods within the world’s largest free trade area. This new aid program is a sign of progress in the efforts to increase trade, investment, and prosperity for both Africa and the UK.
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The UK’s partnership with the African Continental Free Trade Area (AfCFTA) has gone from strength to strength as the deadline draws closer. The UK’s Department of International Trade has been working with the African Development Bank (AfDB) to develop the partnership. The UK’s Department for International Development (DFID) has also provided funding to the AfDB to provide technical support to the countries as they develop their legal and institutional frameworks for the new free trade area.
The UK is working with the IMF and World Bank to develop and implement the African Trade Policy Centre, which will support the development of sustainable trade policies in Africa and help countries implement the AfCFTA. This will help to reduce unnecessary trade barriers, promote a more competitive business environment and improve market access. The ultimate goal of the free trade area is to integrate the whole continent into a single economic community and boost intra-African trade by removing the barriers that have held the continent back for decades. It is clear that if the free trade initiative is successful, it could change the way the world trades goods and products in the future.
At Mango Logistics, we pride ourselves on being able to provide a trusted international delivery service between clients in the UK and their end users overseas. If you are looking to take advantage of the AfCFTA to export your products and consumables within the free trade area in 2022, let Mango Logistics become your international delivery partner based in London.
Our secure international delivery services are tailored to you and your requirements. To discuss your delivery needs, get in contact with Mango Logistics today.
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