Africa celebrated the ratification of the Continental Free Trade Area Agreement (CFTA) in Kigali in 2018 and again on 1st January 2020 when the work kicked off with the loudest jubilation in the hope of its promises. I am still jubilating because what our pan-African campaigners dreamed of can be realized in our lifetime if we make the “One Africa market” work.
The promise of the CFTA is exciting; it gives us the greatest hope in an indeed united Africa for the good of our people. You may say, Nshuti, you are a dreamer, but let me paint the picture of what the CFTA means for us through the eyes of an entrepreneur.
Imagine an entrepreneur in the incredible Thomas Sankara’s Burkina Faso who sells world-famous fabrics her family has made for generations. She sells in the shop or in front of her home to her village and visitors from around the town on market days. Occasionally, she receives customers from neighbouring countries who pass through the border town where she lives. All her sales are from passersby and in cash. She tries to get a small loan to produce more efficiently, make home improvements, or fund her daughter’s education. Still, the village bank won’t lend her money because they cannot assess credit risk due to limited records of her business.
Now imagine that the CFTA is alive and working. A young and dynamic techpreneur has caught wind of the digital trade opportunities opened by the government doing the digital trade protocol work. They have built an application that allows the fabric maker to buy supplies and sell her fabrics online while receiving all her payments straight into her digital wallet/account from anywhere in Africa and beyond. Using that application, the fabric maker can also schedule shipping to everywhere her products need to go and track the packages in the customer’s hands. Thanks to easier buying, selling, and payments digital platforms, the village bank is calling her to offer a credit card (to simplify her transactions) and discounted loans with no collateral required. Now that the sales and transactions are recorded to assess credit risk, life becomes easier: business is simpler and more efficient, and the possibilities abound.
Imagine that life gets easier for hundreds of thousands of traders who cross borders to buy and sell from sisters and brothers in neighbouring countries. This is possible. For one thing, thanks to the CFTA, border officers will scan traders’ digital IDs registered on mobile phones, thereby rendering stamps on passports redundant. For another, thanks to more techpreneurs, many will not have to leave their homes, shops, or market stalls because they can buy, sell, and pay from the comfort of wherever they are, and goods will find them wherever they are, through the services of logistics entrepreneurs.
This is where it gets interesting for young techpreneurs. The logistics involved mean that to make the CFTA work in practical terms, every business of every size will need a smart device, an inventory management application, embedded interoperable payments, and some digital skills. These required digital skills represent opportunities for Africa’s youth to build, make, operate, and manage these systems. If you need more assurance, read up on the millions of pioneers who scale up their digital products, most of which are geared around delivering goods and services efficiently.
The CFTA Secretary-General and his team have laid the legal foundation to make the CFTA work. They work with every government, from the highest level, to bring about the requisite legal instruments (protocols) that will regulate cross-border trade. It is a daunting task, with almost insurmountable odds stacked against them. But succeed, they must because Africa’s future truly depends on it.
Now you may ask: how does the future of Africa depend on it? Well, no developed economy has coped without thriving businesses. People-centred endeavours, spurred by private and public investments, are the only way for us to achieve our national and collective socio-economic development goals. Africans are buying and selling to each other every day, but doing so only in cash leaves us losing out on opportunities that would make this money work for us. With thriving digital trade, over $1.9 trillion in cash (70% of our collective GDP) that is exchanged daily as we buy and sell goods and services will remain in the banking system. The more money in the banking system, the easier it becomes for every individual, business, organization, and government to access affordable loans in continental currencies and invest in growth activities.
Digital trade in the CFTA made easier by responsible cross-border payments affords us the quickest way to the kind of financial freedom our continent needs to stand on its feet. Such release would make it more appealing for our children to choose to stay home, provided Africa replicates these efforts across sectors, in education, health, governance, and security, for instance.
There are indeed countless and endless possibilities for you, our youth. This begs the question: Which one will you choose and run with to prepare? Where will you lend your voice and muscle to make sure CFTA is successful for you, your children, and generations after them?