Implementing the AfCFTA: Assessing the SADC Region readiness and the DFI Role

The AfCFTA entered into force in May, 2019. It was launched at the 12th Extraordinary Session of the AU Assembly of Heads of State and Government in Niamey – Niger, in July 2019 and trading under the AfCFTA commenced on January 1, 2021.

The African Continental Free Trade Agreement (AfCFTA) is the world’s largest free trade area bringing together the 55 countries of the African Union (AU) and eight (8) Regional Economic Communities (RECs). As one of the flagship projects of Agenda 2063, the mandate of the AfCFTA is to create a single continental market for a population of about 1.3 billion people and a combined GDP of approximately US$ 3.4 trillion. As part of its mandate, the AfCFTA intends to eliminate trade barriers and boost intra-Africa trade by advancing trade in value-added production across all service sectors of the African Economy. While the AfCFTA is envisaged to contribute to establishing regional value chains in Africa, enabling investment and job creation, it is important to understand its impact on the SADC region and the role of SADC DFIs in the implementation of the AfCFTA.

The SADC region has a lot of work to do to ensure the successful implementation of the AfCFTA as it has the potential to foster industrialisation, job creation, and investment, thus enhancing the competitiveness of the SADC region and Africa as a whole. Development Financial Institutions finance the private sector, which is becoming the engine of Africa's regional integration. They ensure that the economic and social issues are addressed adequately.

 The forum therefore addressed issues around the regional integration and implementation of the AfCFTA basing its concentration on infrastructural connectivity, investment and trade issues and the integration and provision of financial systems to enable the implementation of the AfCFTA.