Ghana to host Africa's continental free trade zone – Minister

Company News of Thursday, July 11, 2019

Source: ghananewsagency.org

2019-07-11

Mr. Alan Kyerematen, Minister of Trade and Industry, revealed that Ghana had been chosen by the African Union to be the host country of the African Continental Free Trade Area (AfCFTA).

The country, he said, was therefore required to set up a secretariat, adding that the government had begun setting up the secretariat in Accra, which should be completed by March 2020.

Mr Kyerematen made the remarks at a press conference organized by the ministry in Accra to reveal to the public the status of AfCFTA and Ghana's contribution to its development.

He said the Secretariat, once established, would allow the country to become Africa's new commercial capital, a hub of regional trade and an epic economic center.

It would also serve as a new gateway to the continent and promote foreign direct investment, as it would help the country become an attractive investment destination, he said.

The Minister said that the Secretariat would also attract major international financial institutions and would become the preferred location for the headquarters of international companies operating in Africa and would provide opportunities for Ghanaian professionals to be recruited to work in the Secretariat.

The AfCFTA also aims to open new market access opportunities on preferential terms for Ghanaian producers, particularly small and medium-sized enterprises (SMEs), and to offer the country the opportunity to organize various regional and continental meetings badociated with AfCFTA.

The AfCFTA is a single market (duty-free, quota-free) covering the entire African continent with a total population of 1.2 billion and a combined gross domestic product of nearly three billion of dollars.

Fifty-four out of 55 countries have signed the Agreement and 27 countries have ratified the Agreement.

Mr Kyerematen said that AfCFTA was the most significant development in Africa since the creation of the Organization of African Unity in 1963 and was considered the flagship project of the Organization. in terms of number of Member States.

He explained that AfCFTA should increase intra-African trade through better harmonization and coordination of trade on the African continent.

The Agreement, he said, had four key elements: the Framework Agreement incorporating principles, guidelines and negotiating modalities; the Protocol on Trade in Goods with relevant annexes; the Protocol on Trade in Services with relevant annexes; and the Protocol on Rules and Procedures of Work for the Settlement of Disputes.

He said three other protocols including investment, competitive policy and intellectual property rights would be concluded in the second phase of the negotiations.

"The strategic objectives and benefits of AfCFTA include the development of regional value chains and the facilitation of cross-border investments; improving the access of African SMEs to a wider market on preferential trade terms; and attract foreign direct investment to Africa with strong regional and local content, "said the minister.

AfCFTA, he said, would also facilitate the integration of African economies into global markets; significantly improve the terms of trade for African countries; increase benefits for African consumers through lower prices of imported products from Africa; and significantly improve employment opportunities in Africa, especially for young people.

Mr Kyeremateng said it was estimated that intra-African trade would increase up to $ 35 billion a year, or 52% by 2022.

The benefits of signing the AFCFTA, he explained, would not come automatically, which is why an action program aimed at boosting intra-African trade (BIAT) was approved by the AU Heads of State so that Member States exploit these benefits.

BIAT would focus on seven priority groups: trade policy, trade facilitation, production capacity (industrialization), trade-related infrastructure (transport and communications, for example), trade finance, trade information, and factor market integration.

Expressing on measures taken by Ghana to exploit the benefits, Mr. Kyerematen said the government had introduced the One District, One Factory; Strategic anchoring industries; and initiatives of the region a park (industrial parks and special economic zones).

The establishment of the EXIM Bank to strengthen trade and exports, the implementation of stimulus measures for local industries, initiatives to develop ports, the development of SMEs, the improvement of the Ghana Stock Exchange and information on electronic commerce.