AfCTA now becomes the largest free trade area, uniting 1.3B people, since the creation of the World Trade Organization in 1994 and is expected to unlock Africa’s potential by boosting intra-regional trade, strengthen supply chains, and spread expertise across countries.
July 7 from now on will be officially celebrated as the Day of African Integration in commemoration of today's historic operationalisation of the #AfCFTA, as we start the journey thr economic integration vision of the #AfricaWeWantpic.twitter.com/hGf0djU9X8
The agreement will see new mechanisms set up of determining the rules of origin, a digital payment system, and online toll for listing products and tariffs, and monitoring system to deal with non-trade barriers.
Currently, Nigeria, Egypt, and South Africa account for over 50 percent of Africa’s cumulative GDP with island nations representing only 1 percent. Nigeria, the largest economy in Africa, signing the agreement was seen as a big boost.
According to Niger’s President, Mahamadou Issoufou:
“Nigeria is Africa’s biggest economy and most populous country. Without Nigeria, the free trade zone would’ve been handicapped.”
Current trading blocs stats as of 2017 are as follows:
17% – Intra-regional trade in Africa
69% – Intra-trade in Asia
69% – Intra-trade in Europe
The agreement will see the removal of trade tariffs on 90 percent of commodities and will take effect starting on July 1 2020.