How Africa’s Economies Can Hedge Against COVID-19
The African Continental Free Trade Area will help dismantle tariff and non-tariff barriers amid a pandemic and global recession. Accelerating Africa’s economic integration will cushion its fragile economies and help turn the continent into the world’s largest common market.
JOHANNESBURG – In 2018, 44 countries signed the African Continental Free Trade Area at an extraordinary summit in Kigali. There are now 54 signatories. The agreement will create a tariff-free economic environment to spur business growth, boost intra-continental trade, spark industrialization, and create jobs. To mitigate the economic fallout from COVID-19, African Union (AU) member countries and the continent's institutions should implement the AfCFTA swiftly.
The AfCFTA paves the way for Africa – with 1.2 billion people and a cumulative GDP of $2.5 trillion – to become the world’s largest common market. But with the coronavirus hitting the global economy, a worldwide recession is looming. The crisis is bound to have destabilizing effects on our fragile economies as the health crisis worsens.
Africa must be prepared. Although the COVID-19 pandemic is affecting Africa the least, the majority of African countries have chosen to pre-empt the crisis by restricting non-essential travel and gatherings and closing schools and universities. It is impossible to know whether these measures will stem the health contagion, but Africa will no doubt experience economic contagion.