Zimbabwean businesses should up their game and be competitive for them to enjoy the immense benefits of joining the Africa Continetal Free Trade Area (AfCFTA), an industry official has said.
Zimtrade chief executive Allan Majuru told NewsDay that Parliament’s recent ratification of the trade agreement was an opportunity for local companies to increase production for export to the entire African continent.
The agreement, which was signed by 44 African Union member countries will result in Africa becoming a single market once fully operational.
To date, 15 countries have deposited of AfCFTA ratifications with the chairperson of the African Union Commission Ghana, Kenya, Rwanda, Niger, Chad, Congo Republic, Djibouti, Guinea, eSwatini, Mali, Mauritania, Namibia, South Africa, Uganda, Côte d’Ivoire. Sierra Leone, Senegal, Togo, Egypt, Zimbabwe and Ethiopia have received parliamentary approval for ratification.
The total number of ratifications (approved and deposited) now stands at 21.
“The AfCFTA will stimulate and encourage trade between member countries through preferential treatment in the reduction or elimination of customs duties and other non-tariff barriers, investment promotion and free movement of people across borders”.
“It will open up markets for the country, but also, it opens up our target markets to competition, so we need to work on enhancing our industry by retooling, and enhancing the ease of doing export business, i.e. trading across borders,” Majuru said.
“However, the competition is now stiffer. Our companies need to be competitive in order to fully benefit from this agreement. There is need to address issues that negatively affect competitiveness.
“There is also need to venture more into export led investment aimed at value-addition because as a continent we export more of raw materials i.e. minerals and commodities.”
The AfCFTA, which is the biggest agreement signed since the World Trade Organisation accord was signed in January 1995, represents a major advance for African integration and unity.
The United Nations Economic Commission for Africa estimates that AfCFTA has the potential to increase intra-African trade by 52% by 2020.