President Cyril Ramaphosa has officiated the launch of SA's first shipment and preferential trading under the African Continental Free Trade Area (AfCFTA) at the Port of Durban on Wednesday.
The President signed the SA Revenue Service (Sars) products certification of origin, flanked by Minister of Public Enterprises Pravin Gordhan,Transnet Acting Group Chief Executive Michelle Phillips and Sars regional director, Dan Zulu.
The successful implementation of the AfCFTA will lead to diversification of exports, increased productive capacity, acceleration of growth, increased investment, increased employment opportunities and incomes and most importantly, broaden economic inclusion, both in South Africa and the rest of the continent, according to a statement by government.
Ramaphosa said AfCFTA will accelerate the development of regional and local value chains and this in turn will offer investors access to a population of 1.7 billion people and a continent with a fast growing GDP.
Specifically, the hope is that this trading agreement will provide South African exporters with new market access opportunities to key markets in the African continent and can unlock growth.
The president, yesterday was flanked by Minister of Trade, Industry and Competition Ebrahim Patel, Premier Nomusa Dube - Ncube and other dignitaries as they witnessed the first shipment of Proudly South Africa products to Ghana, Rwanda, Tunisia and Egypt.
“Trade under the AfCFTA should see the prices of South African manufactured goods being more competitive in the African market, which bodes well for the growth of the local manufacturing sector and, by extension, local employment,” Meluleki Nzimande, a partner in Webber Wentzel’s Competition, Trade & Investment team, told BusinessTech.
WHAT IS AfCFTA
The African Continental Free Trade Area is a free trade area encompassing most of Africa and was established in 2018 by the African Continental Free Trade Agreement.
It includes 55 countries of the African Union and eight regional economic communities to create a single market for the continent.
This is the second largest free-trade area by number of member states, after the World Trade Organization.
According to the agreement, AfCFTA member states are committed to eliminating tariffs on most goods and services over a period of five, 10, or 13 years, depending on the state’s level of development.
AfCFTA is expected to increase the size of Africa’s economy to $29 trillion by 2050.