COVID-19: How to keep trade between Africa and the rest of the world flowing

Protectionism, a rising trend globally, has been exacerbated by the economic impacts of the COVID-19 pandemic, spelling potential trouble for African trade. In a recent interview with CNBC Africa, Frank Matsaert, the CEO of Trade Mark East Africa, shared insights on the challenges faced and potential solutions to keep trade between Africa and the rest of the world flowing. Matsaert highlighted the critical role of trade in poverty alleviation, emphasizing its historical significance as a key driver of economic growth. However, he noted that trade imbalances and the rise of economic powerhouses like China have fueled protectionist sentiments in some countries. The erosion of global trade institutions like the World Trade Organization (WTO) has only exacerbated this issue. Key Points: 1. Impact of Protectionism on Africa: Matsaert underscored the potential negative effects of protectionist policies on African trade. Increased trade tariffs and restrictions could hamper investments in processing and manufacturing industries in Africa, making exports less competitive. This could lead to job losses and reduced business profitability, impacting various sectors, including agriculture and tourism. 2. Trade Mark East Africa's Safe Trade Facility: Matsaert discussed the initiatives undertaken by Trade Mark East Africa to ensure safe trade amidst the pandemic. The facility aims to instill confidence by providing protective equipment to border officials and enhancing tracking systems for truck drivers to prevent the spread of COVID-19. Additionally, efforts are focused on reducing tariffs on essential goods and addressing disruptions in key value chains to maintain the flow of exports. 3. Ensuring Continued Interest in African Trade Post-COVID-19: Matsaert emphasized the importance of reducing trade barriers and enhancing safety measures to sustain global interest in trading with the continent. By simplifying cross-border trade processes and promoting regional integration, African countries can attract investment and leverage the potential of the African Continental Free Trade Area (AfCFTA) to access a market of over a billion consumers. In conclusion, Matsaert called for concerted efforts to streamline trade processes, reduce red tape, and foster a conducive environment for trade to thrive post-pandemic. By prioritizing safety, efficiency, and market access, African nations can navigate the challenges posed by protectionism and emerge stronger in the global trade landscape.