Development finance institution the African Development Bank's (AfDB's) African Development Fund approved an $11.02-million support package to the Permanent Secretariat of the African Continental Free Trade Area (AfCFTA) to help it enhance effective implementation.
This second phase of support continues to aim to encourage sustainable intra-African trade and to increase the share of African countries participating in it.
It is also intended to move the African trade integration agenda forward by enabling the secretariat and the member countries to harmonise and integrate national and regional trade policy initiatives.
The AfCFTA Secretariat opened its doors in Accra, Ghana, on August 17, 2020, with initial support of $5-million to set up the secretariat, the programmes and the tools and to raise stakeholder awareness.
The AfDB’s support will be structured under three components, namely institutional strengthening of the AfCFTA Secretariat; private-sector support to implement the AfCFTA, and support for climate-resilient regional and continental value chains to boost intra-Africa trade.
Additionally, studies and initiatives will be undertaken to identify new business and economic opportunities for women, to help develop the AfCFTA Women and Youth in Trade Protocol and to support capacity building and targeted business skills for women.
“The relationship between the AfCFTA Secretariat and the [AfDB] Group is crucial to achieving greater continental trade and the economic transformation of Africa. Our board's approval of this grant will enable the Secretariat to further ensure that trade is conducted in a harmonious, predictable and free manner on the continent,” said AfDB Industrial Development and Trade Department director Abdu Mukhtar.
The world’s second-largest free trade area has a potential market of 1.2-billion consumers, but Africa has the world’s lowest level of intraregional trade at less than 18%, compared with 22% in Latin America, 50% in Asia and 70% in Europe.
The AfCFTA is aimed at increasing this by up to $35-billion a year, or 25%, over a decade; lowering imports by $10-billion a year; boosting agriculture exports by up to $45-billion a year; and increasing industrial exports by up to $21-billion a year.