Governor of the Bank of Ghana, Dr Ernest Addison has encouraged all financial institutions in Ghana to collaborate and take advantage of the opportunities offered through Africa Continental Free Trade Area (AfCFTA) to boost the country’s trade efforts.
Dr Addison explained that the AfCFTA is one of the flagship projects of the African Union’s “Agenda 2063: The Africa We Want”, which aims to promote trade among 55 African countries, with a market size of about 1.2 billion people and projected US$450 billion income boost for the continent by 2035.
The main objective of AfCFTA, he said, is to create a single market for goods and services and promote the free movement of business persons and investments in Africa.
The Agreement seeks to expand intra-African trade through better harmonization and coordination of trade liberalization and facilitation regimes. Trade remains an important driver for economic growth and development in Africa. Intra-African trade has increased in recent years; nevertheless, Asia and Europe remain the main trade partners of the continent.
High dependence on trade in primary goods, high product and market concentration of exports, and weak regional production networks are among the main challenges of trade on the African continent.
Speaking at the Ghana Trade Road show Session with the Banking and Finance Community last week, he said “The trade constraints in Africa are partly linked to small, fractured, and partially-isolated markets. The effective implementation of AfCFTA would therefore be a giant step forward and the Agreement demonstrates Africa’s readiness to integrate into the global trade agenda.
“To play a relevant role in this space, the continent must strategically position itself to take advantage of the opportunities AfCFTA presents. This would require commitment from all countries and all stakeholders. The Africa Trade roadshow series is coming at an opportune time to help facilitate and create the enabling environment for trade for all stakeholders in the trade industry in Ghana.
“African integration and development is anchored on financial sector development and access to finance and investment. In addition to the fragmented markets, inadequate payment systems infrastructure has been identified as a major constraint to intra-African trade. Payments within Africa are mostly done through correspondent banks before reaching the recipient African neighbor. This comes with high transaction fees, compliance costs, applied foreign exchange conversion rates, and liquidity costs.”
