Africa agrees deal for Continental Free Trade Area
The leaders of 44 African countries have signed a deal to create one of the world's largest free trade blocs.
The agreement was signed at a summit in the Rwandan capital, Kigali.
It is hoped the deal will come into force within six months, and increase prosperity for 1.2 billion Africans.
But
10 countries, including Nigeria, have refused to sign the deal, and it
will need to be ratified by all the signatories' national parliaments
before the bloc becomes a reality.
The African Continental Free
Trade Area (CFTA) would remove barriers to trade, like tariffs and
import quotas, allowing the free flow of goods and services between its
members.
In theory that should boost commerce, growth and employment.
African Union commission head Moussa Faki Mahamat called it a
"glorious challenge... which calls for the courage to believe, the
courage to dare... the courage to achieve".
He then recognised that to succeed the countries will "need to summon the required political will".
An EU for Africa?
Trade
between African countries is relatively low. It accounts for only 10%
of all commerce on the continent - compared with 25% in south-east Asia -
according to news agency Reuters.
Once the free trade area is
established, the ambition is to take further steps that echo the
creation of the European Union - like a customs union, a common market,
and even a single currency, says Matthew Davies, editor of the BBC's
Africa Business Report.
He says many obstacles still have to be overcome.
One
is the relatively low level of manufacturing that takes place on a
continent where trade often means selling raw materials to the outside
world.
Another is getting Africa's largest economy, Nigeria, on
board. President Muhammadu Buhari pulled out of the summit, after
"certain key stakeholders" - thought to mean trade unions and businesses
- complained they had not been consulted.
BBC
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