Will Africa's historic Free Trade Agreement succeed? | Inside Story

The World Bank ranks many countries in Africa among the hardest places to do business.
However, an ambitious project to ease trade between them is a step closer to reality.
The African Union agreed last year to create a free trade zone on the continent, the largest since the World Trade Organization was formed.
On Tuesday, Gambia became the 22nd country to ratify the accord, reaching the threshold for it to be implemented.
It's hoped the deal will reduce tariffs and trade rules, and create jobs for a market of 1.2 billion people.
But Africa's largest economy, Nigeria, isn't on board with the agreement.
So will the deal succeed?

Presenter: Martine Dennis

Guests:
Aly-Khan Satchu - CEO of Rich Management and an emerging markets economist
Stephen Yeboah - Co-Founder of Commodity Monitor
Olusegun Okubanjo - founder and managing partner of OBSIDIAN, a finance firm focusing on East, West and Central Africa

#AlJazeeraEnglish #InsideStory #AfricanFreeTradeAgreement

[frankman]

I am from Barbados and when we hear Africa come together to do anything we are very happy and trade and free movement is very inportant and trade with us in the west Indies we need stuff from home too ok nuff love Africa

[Gintoki]

France has to leave the continent and the USA. Also can someone start a movement to stop western countries facilitated corruption with offshore accounts and trusts with stolen African wealth. Colonialism never ended it just changed faces with corporate colonialism.

[victorhero]

Is not all about signing an agreement so many Africa countries are still under colony. You can't sign an agreement with countries that are still in control by France

[gnanendrag]

Supporting the development of Africa, from India😍

[michaelb]

I'm an African who meet other African people only in the western countries there is no contact between us in Africa.

[edwinclarke]

Grenadaian here big up Africa you in my pray.

[pietrojenkins]

It probably won't succeed because Africans give fellow African the toughest visa rules, trade and migration policies. Its easier for a Kuwaiti to set shop in Chad than for a Zimbabwean to get the same.

[francis]

Africa is on the right track with the free trade within itself.

[elijah]

One love my African Brothers. Please read this, from a Nigerian: For Nigeria, because it's not diversified, and because it has such a large economy, it should not join right now. If it did, yes Nigeria might perform well within the oil sector on the continent, given its new largest refinery in the world being built and significance in the sector. But when it comes to agriculture, manufacturing, minerals, financial technology, etc., other companies from other countries on the continent will grow in these industries much quicker by targeting Nigeria's market of ~ 200 million people. And the possibility of Nigerian companies in these sectors growing (and creating more jobs for its people) decreases significantly due to external competition. Also, who's to say that Germany or China, doesn't create a proxy company in one of these Free Trade countries like Kenya for example, and absolutely destroys any opportunity for African competitors?


What will happen is China will create a telecomms company in Kenya under Huawei, sell to every other company in this Free trade agreement, and absolutely dominate the continent. Germany will do the same with vehicle manufacturing, and others. We'll have another scramble for Africa on our hands. For smaller countries its good, because China has already been taking advantage of many of them. But its a bad idea for larger countries. Having regional free trades is much more intelligent at this moment.

If Nigeria waited to develop its own diversified economy with varied businesses, it will be in a better position to then compete against other companies from other countries on the market. Remember, Nigeria has the largest population on the continent, with tens of millions in abject poverty. It needs to make sure it is in a position to give all of these people jobs from within the country, without relying on other companies on the continent. After all, that's the role of government and elections. We still are a part of the African Union, and hope fellow africans can understand this line of thought. One love.

[solohd]

Good job EAST AFRICA(Tanzania, kenya, uganda, ethiopia, Rwanda, Burundi, south our congo brothers and siters.) much love from Kenya

[logicgladiators]

I think Nigeria has a solid point. Until each african country solidifies economic partnership agreement with non african firms coming to establishment, Nigeria should not sign this! Until we make sure that non African firms will employ Africans, retainer and reinvest in the african countries, such monumental agreement will not benefit Africa but Asia and Europe.

[QSRWORKXCHANGE]

It's better to try and fail than fail to try.

[evehawasinare]

Idea noble. Achieving them through free trade is not so simple. Free trade structure removes tools to address economic problems within countries with diverse economic needs.

[yahayaalphonse]

read the comment section and see the hate between Africans, Ghanaians bashing Nigerians, Nigerians bashing someone else, the first thing we need is a change of mentality and a change of mindset, then and only then, progress would come to Africa, God bless Africa!!!

[till-ulrichhepp]

It might indeed make sense for Nigeria to wait until all it's economic sectors have reached a certain level of competitiveness to not be wiped out immediately by competition as Nigeria does also have to employ and feed more than 200 million inhabitants. All in all, though the agreement is great and should indeed be pursued. Once Nigeria has diversified more, it can join in - that might happen fairly soon as Nigeria is developing very rapidly.

[ewaurethegreat]

I agree with both side. But why create another continental agreements when the regional agreements are not working. Trade between Nigeria and Ecowas is less than 5% how is that going to change with the whole of Africa. Ivory Coast will rather run to France and sign agreements with them, rather than for them to go to Nigeria or Ghana. We need to strengthen the regional agreements first then implement it on a continental scale.

[Odeon]

Missing Nigeria in the beginning can be a good thing. It will be easier to integrate countries with similar level of economic development. I have a feeling that Nigeria would obstruct the process at this point in time. Kind regards to all my African friends from Serbia (Eastern Europe)

[themaltesesailor]

Olusegun was entirely right about the dangers of allowing European and Western corporations the chance to pounce on the emerging African countries' markets. Particularly with foreign investment. China is well-known for this, they send billions in "loans" to pay and train their own Chinese workers, to develop and run businesses, infrastructure, etc. in the nations. The Nation loses 2/3s of the potential profit, and the Chinese gain from the extraction. Avoid this at all costs.

[DJSundayTowers]

This is a good idea not only toward free trade but an initiation of a united countries of the continent of Africa. An intermingling of borders brings the people together and makes Africa a stronger identity of who they are as Africans and not so much as belonging to their individual countries, without losing their individual country's cultural identity. A united Africa can bring about an agreement to a new one unified monetary denomination, as in all individual countries of the world have, making it less complicated and ease of trade on the level of the street population.

[sheniquamiller]

okubanjo makes a lot of sense as far as keeping an eye on the true and interest of foreign investors that may try to destabilize Africa once again through this endeavor. .. which poses a major threat entirely! .. let's go