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Opinions of Monday, 24 June 2019

Columnist: Michael Sumaila Nlasia

Is Africa ready for the continental free trade area?

“The only thing we learn from history is that we learn nothing from history.” – Georg Wilhelm Friedrich Hegel

About fifty years ago, under the visionary leadership of Ghana’s first President, Dr Kwame Nkrumah, the Organization of African Unity, hitherto African Union (AU), earmarked an African Common Market program. According to Dr Kwame Nkrumah, it is an African economic community in which we can pull our production and trade to a common advantage.

For example, currently, four West African nations produce almost 70% of the world’s cocoa – Ivory Coast (42%), Ghana (18%), Nigeria (5%) and Cameroun (4%) – but they get just about 2% of the $100 billion a year revenue of the chocolate industry.


As a result, on March 28 2018, both Ghana and Ivory Coast had signed a treaty to defend their interest in cocoa production, and to a large extent become a cartel for cocoa prices in the world market. In fact, the competition for sources of raw-materials by the most advanced and industrialized economies makes continental Africa a vortex for imperialism. This was the reason why the founding fathers of AU saw the need for African countries to break the artificial boundaries and to break bread with a common market in order to develop the entire continent.

Nevertheless, the goal has never been relinquished. Fast forward in 2012, the 18th Ordinary Session of the Assembly of Heads of State and Government of the African Union adopted a decision to establish an African Continental Free Trade Area (AfCFTA) by 2017. But what does this agreement mean in practice and how will it benefit us?

African Continental Free Trade Area (AfCFTA)

Well, the first thing to point out about AfCFTA is that it is not simply a ‘Free Trade Agreement’. It is actually much more than that. It is about establishing a unified continental market, including the free movement of labour and investments. The three main benefits AfCFTA focuses are:

First, the African continent, all 55 countries have a collective GDP of $2.5 trillion, making it the 8th largest economy in the world just behind India. And that also makes the continent much more attractive to investment, both from within and from outside the continent. This will encourage business people to make the investments necessary to sustain economic growth and create the job opportunity the continent badly needs.

The second argument in favour of AfCFTA is that it includes a protocol on the Free Movement of people. This matters because, at present, travelling between African countries for Africans currently can be very challenging. Currently, there are a lot of trained and skilled people across the continent coming out of schools, universities and colleges who cannot find work. If free movement is endorsed, people will be able to use their talents anywhere in the continent where there is a demand for those talents.

And the third powerful argument in favour of AfCFTA is that it will increase trade between African countries. According to the United Nations Economic Commission for Africa (UNECA), less than one-fifth of all export are currently from one African country to another. Take Kenya for instance, the largest economy in the East African Community, each year the country exports $1 billion to Europe, and around $500 million to the US worth of products. Kenya’s total export amounts to $6 billion in 2017. But guess how much Kenya exports to its neighbour Ethiopia? In 2017, it exported just $69 million to Ethiopia. Why? Obviously, the main reasons is the high level of trade taxes. For that matter, AfCFTA is proposing to remove trade taxes on at least 90% of all trade between African countries to boost regional trade by nearly $1 billion and to create excessive jobs across the continent.

In spite of all these promising features AfCFTA is offering, the question we must ask is: how will Africans embrace immigrants from other African countries to allow for the free trade and movement of goods and people without discrimination or violence as evidenced in xenophobic attacks?

Threat of Xenophobia on the African Continental Free Trade Area

Back in the year 1969, when Busia’s government was inaugurated in Ghana, it immediately issued the expulsion order which caused the deportation of African immigrants, predominantly Nigerians, in a manner never before attempted – after the Aliens Compliance Order was enacted on November 18 1969. This happened as a result of the economic success Ghana had in the early 60s, drawing the influx of immigrants into the country for greener pastures.

But the table turned when mass Africans migrated to Nigeria during the early years of the oil economy boom in the 1970s. After Shehu Shagari took over the reign of government in the country, in 1983, he gave an executive order for illegal immigrants, mostly Ghanaians, to leave the country or face an arrest.

This somewhat regressive situation is unfortunate, as it is obvious that Africans migrated to these countries for economic prosperity with the expulsion been the downside. Now, the state is worsening with the prevailing spate of xenophobia across the continent. For example, in South Africa, the fear of the perennial xenophobic attacks on other African nationals persist as South Africans accuse them of taking their jobs. And in recent times, Nigerians in Ghana have been accused of the country’s hike in insecurity and the job takeover causing attacks on some Nigerian shops in some parts of the country.

In the end, if AfCFTA is to be successful to benefit us, we must wake up and smell the coffee. We must learn from the past and put on our African nationalist thinking to resolve our many challenges together, most especially xenophobia. In the famous Zulu philosophy, Ubuntu, meaning “I am because we are”, is the duty we owe to ourselves, to care for one another, and to strive to bring economic prosperity to Africa and to all Africans.