THE East African Business Council and his development partners convened a two-day meeting in Nairobi, Kenya this weekend to deliberate on liberalisation of goods and services in a bid to repositioning the EAC region in light of the African Continental Free Trade Area (AfCFTA).
Over 40 industry and business experts from the region attended the meeting organised also by the Kenya Private Sector Alliance (KEPSA), International Trade Centre (ITC) and TradeMark East Africa.
We find the Nairobi forum has come at the most opportune time as without strategies the region will not be able to benefit fully from the agreement covering a market of 1.2bn people with a combined GDP of 2.5 trillion US dollars.
The AfCFTA aims to establish a single continental market for goods and services, and ease the free movement of businesspeople and investment across the continent.
Ultimately, the deal seeks to boost intra-regional trade levels, promote investment and job creation, and help transform the economic landscape of the continent in favour of higher value added and wealth generation. Signatory countries will need to drop 90 per cent of their tariffs for imports from other African states.
According to the United Nations, this could boost intra-African trade by 52.3 per cent. And once countries drop their remaining tariffs, which they will be allowed to maintain for a decade in order to protect key industries, the U.N. says intra-African trade will double. However all these will not drop like manna from heaven.
There will be challenges to navigate before its benefits can be fully felt, including infrastructure gaps and unreliable power supply, small and fragmented economies, attitude to doing business and corruption.
Both public and private sectors will have tremendous role to play to make EAC nations make optimum use of its strategic advantages to benefit from the agreement.
It is what we have in terms of our strategic positioning, young population, abundant natural resources and fast growing economies that will give us confidence and optimism to benefit from the agreement, a flagship project of the African Union’s “Agenda 2063” development drive which got a major push forward under the AU chairmanship of Rwandan President Paul Kagame last year.
We also believe that it is important that the private sector in the region, the engines of our robust economic growth, has stepped up to ask for more engagement on AfCFTA negotiations instead of remaining as bystanders.
It is important that they chose to be proactive and engage strategically to seize opportunities from the agreement even when, we in Tanzania, have not yet ratified the agreement.
We see the positive side of the agreement in terms of expanding market size for our rapidly growing manufacturing sector. However, we are not blind on some challenges which must be carefully sorted out to ensure a win-win situation for all.
What we see is that the importance of private sector engagement in these negotiations cannot be overemphasized.