African leaders launched a continental free-trade zone on Sunday that if successful, could unite 1.3 billion people, create a $3.4 trillion economic bloc and usher in a new era of development.
After four years of talks, an agreement to form a 55-nation trade bloc was reached in March, paving the way for Sunday’s African Union summit in Niger where Ghana was announced as the host of the trade zone’s future headquarters and discussions were held on the bloc’s operations.
It is hoped that the African Continental Free Trade Area (AfCFTA) – the largest since the creation of the World Trade Organization in 1994 , will help unlock Africa’s long-stymied economic potential by boosting intra-regional trade, strengthening supply chains and spreading expertise.
“The eyes of the world are turned towards Africa,” Egyptian President and African Union Chairman Abdel Fattah al-Sisi said at the summit’s opening ceremony.
“The success of the AfCFTA will be the real test to achieve the economic growth that will turn our people’s dream of welfare and quality of life into a reality,” he said.
Africa has much catching up to do: its intra-regional trade accounted for just 17% of exports in 2017 versus 59% in Asia and 69% in Europe, and Africa has missed out on the economic booms that other trade blocs have experienced in recent decades.
Economists say significant challenges remain, including poor road and rail links, large areas of unrest, excessive border bureaucracy and petty corruption that have held back growth and integration.