REVOLUTIONIZING AFRICAN INTRA-TRADE

 STRENGTHENING AND PROMOTING  AFRICAN INTRA-TRADE FOR AGRICULTURAL DIVERSIFICATION, GROWTH, AND ENHANCED INTEGRATION OF AFRICAN REGION IN THE GLOBAL ECONOMY 

MADE IN AFRICA: THE NEW DAWN

"Third world is a state of mind and until we change our attitude as Africans if there is a fourth, fifth, and even sixth world we will be in it.-Patrice L.O. Lumumba.

African intra-trade provides opportunities for development and steady growth. It can reduce susceptibility to global shocks, enhance export competitiveness, and create employment and economic diversification. Boosting African intra-trade and supporting regional integration will promote agricultural transformation hence bringing forth an essential scope for economic diversification due to the linkages agriculture has with other sectors paving the way for industrialization.

To accomplish agricultural transformation leaders need a prioritized strategy and a strong vision with clear and profitable programs. Implementation of strategies for the promotion of intra-African trade to help in agricultural transformation is determined by political economy, the ability to implement the required action, strategize, and navigate obstacles.

 Intra-African trade: A path to economic diversification and inclusion

Spearing the enactment of common external tariffs at the continental level and coordinating these initiatives will help overcome the challenges brought forward by the overlapping membership of countries to two or more RECS. These will help in the harmonization and coordination of trade policies which paves the way for the continental-wide elimination of trade barriers such as tariff rates hence boosting agricultural trade and transformation within the continent.

The designation of key agricultural raw materials such as textiles, and motor vehicles as sensitive products and hence exclusion from liberalization is a hindrance to intra-African trade. To boost intra-African trade and agricultural trade it is important to strategize in decreasing the number of sensitive agricultural commodities considering the internal supply response.

The Framework for Boosting Intra-African Trade in Agricultural Commodities and Services

The absence of transparency and unpredictability around trade policy provisions affect transaction costs hence creating uncertainty in market conditions and prices faced by exporters and importers. As a leader encouraging effective and transparent communication of African countries on important provisions related to import /export bans, quotas tariffs and rules of origin will help in the promotion of agricultural trade.

Opening private sector dynamism focuses on strengthening the private sector to unlock intra-African trade. To reap maximum developmental gains from regional integration and African intra trade a leader needs to place the building of domestic entrepreneurship at the forefront agenda for boosting interregional trade. This should also include a mechanism for dialogue between state and businesses to boost intra-African and agricultural trade and build productive capacity.

Expanding African Trade to Boost Growth and Reduce Poverty

Promotion of intra-African trade and entrepreneurship addresses challenges such as weak inter-firm linkages, low levels of competitiveness, rising levels of informality, the small size of African firms, and lack of innovation capability presented by African enterprise structure hence the need for policy actions to help in transitioning firms from informal to formal economy. This requires government-funded education on how to start a business and on the responsibilities and rights of entrepreneurs, simplifying the process of obtaining business registration permits and tax reductions.

Leaders should promote the growth of firms and upward mobility by providing better access to funds and business services, particularly for small and medium-sized entrepreneurs. The establishment of credit bureaus and registries reduces information asymmetry between lenders and borrowers hence easy access to finance for small and medium enterprises. Furthermore, developing the capacity of small and medium enterprises to meet the needs of large firms through training and provision of market information and business creates inter-firm linkages.

Intra-African trade is key to sustainable development – African Economic Outlook

It’s important to address constraints on intra-African trade imposed by a lack of energy, communication, transport, water, infrastructure, peace, and security. Imposing the need for stronger domestic resource mobilization on the continent and promoting private investment into infrastructure through public-private partnerships.

Boosting intra-African trade to promote agricultural diversification, foster growth, and enhance the integration of African countries into the global economy is one of the main objectives of trade liberalization and regional integration in Africa. However, going beyond liberalization to create potential through diversification and establishment of the continental free trade area. This will require strong political leadership to guarantee close policy coordination, hasten the implementation of harmonized procedures, and ensure equitable outcomes across countries.