On Thursday, 30th May 2019, five days after Africa Day 2019, the Africa Continental Free Trade Area (AfCFTA) will be launched. The free trade is expected to be one of the world’s largest single markets if all the 54 countries in Africa joins.
How will the Africa Continental Free Trade boosts African Entrepreneurship?
AfCFTA will give African entrepreneurs access to a much larger market. This access will help the entrepreneurs to grow beyond the borders of their main geographical scope - an opportunity to reach more customers interested in what they offer.
It's therefore important that young African entrepreneurs begin to understand the details of the free trade agreement and start crafting new trade roadmaps for their businesses.
With more access to a market beyond borders comes increased competition. This is a challenge for African entrepreneurs. However, a business that can improve its competitive advantage through innovation will create value for Africa’s people in the long term while creating enterprise value.
For the AfCFTA’s gains to be realized, entrepreneurs and policy-makers must be aligned in their strategies. They must engage with each other to provide structure and clarity around how goods and services will move, and around the benefits that the agreement will bring to businesses. These discussions between entrepreneurs and the trade ministries of their country will also enable the review and updating of national trade policies, discussions which will benefit both the government and business communities.- Gerald Chirinda, Executive Director, Tapiwa Capital
In addition, a business that will succeed outside its geographic borders needs adequate support in its locality, government support, favorable financing options, business support services, training, conducive environment, etc. that promotes growth. Failing to meet these will result in a failure to access the gains of the agreement.
How many countries have joined?
At the moment of writing this, 52 countries have signed the preliminary endorsement of the treaty while only 22 countries have ratified the agreement or received preliminary approval. However, Africa's largest economy, Nigeria, is yet to join the agreement.