ECA’s Stephen Karingi shares on AfCFTA agreement progress

The 38th meeting of the Committee of Experts of the Conference of African Ministers of Finance, Planning and Economic Development convened in Marrakesh, Morocco on the 20th of March, marking the one-year anniversary of the signing of the African Continental Free Trade Area (AfCFTA) agreement. This event has brought to light significant progress in the ratification process of the AfCFTA, with only one country remaining to complete the ratification process. In a recent interview on CNBC Africa, Stephen Karingi, the Director of Regional Integration and Trade at the Economic Commission for Africa (ECA), shared insights on the advancements in the AfCFTA agreement, particularly focusing on Ethiopia's ratification. Karingi expressed confidence in the commitment of African nations towards the AfCFTA, emphasizing that doubts surrounding the agreement have been dispelled. He highlighted the significance of Ethiopia's ratification, noting the country's substantial economy, vast market, and large population, which are all attractive factors for other African nations and present opportunities for mutually beneficial trade relationships. The progress made in the ratification process indicates a strong commitment from African countries towards harnessing the benefits of the AfCFTA. Karingi applauded the efforts of negotiators in finalizing essential annexes of the agreement, with discussions on the establishment of the AfCFTA Secretariat underway. The imminent decision on the Secretariat's location during the upcoming summit in Arusha is a crucial step towards operationalizing the AfCFTA, enabling countries to navigate trade rules and resolve disputes effectively. Despite Nigeria's absence in the initial signing of the agreement, Karingi remained optimistic about the country's eventual participation and emphasized Nigeria's readiness to derive benefits from the AfCFTA. He encouraged other African nations to leverage the support provided by the ECA and the African Union Commission in preparing implementation strategies, ensuring the successful uptake of the agreement. Addressing concerns about financing the AfCFTA implementation, Karingi shed light on the Boosting Intra-African Trade Action Plan, established in 2012 to facilitate trade and investment within the continent. He underscored the importance of infrastructure development, industrial growth, and skills enhancement to enhance competitiveness and foster economic advancement. The funding required for these initiatives is expected to come from various sources, including investments in key sectors to boost economic growth and job creation. While there may be concerns about potential tariff revenue losses, Karingi reassured that the broader economic benefits of the AfCFTA, such as increased trade within regional economic communities and the emergence of new industries and job opportunities, will offset any initial revenue decline. Additionally, he stressed that the long-term positive impacts of the agreement will create a favorable balance in terms of revenue implications. Overall, the progress in the AfCFTA agreement signifies a significant milestone in advancing intra-African trade and economic development. With Ethiopia's ratification and the impending operationalization of the agreement, Africa is poised to capitalize on the opportunities presented by the AfCFTA, fostering regional integration, economic growth, and job creation across the continent.