Two days ago, January 1, 2021, the African Continental Free Trade Area Agreement took effect bringing 54 African countries under a single trade bloc and thus making AfCFTA the largest single market in the world in terms of a number of countries.
However, how many Africans are aware of the AfCFTA – maybe 5% to be generous hahaha. AfCFTA is headquartered in Accra, Ghana and I doubt a good number of Ghanaians are aware let alone citizens of other African countries. I guess Europe, Asia and America are more prepared for AfCFTA than the beneficiary continent itself. Interesting right?
Africa undisputedly is the raw material hub of the world and the whole world especially the West has a huge interest in this space. Whose interest will AfCFTA further?
While the journey of a thousand miles begins with the first step, the first step must be in the right direction. AfCFTA is certainly a long overdue dream-come-through for Africa but should we rejoice yet? There are a few critical and fundamental questions that I seek to ask in my quest to find out if AfCFTA is the ‘Messiah’ or we should wait for another.
First, what will the AfCFTA market sell? Raw Materials? Can we ‘eat’ our raw materials in Africa or do we still need finished goods from Europe and America? The colonial economy of Africa is basically a raw material economy designed to feed industries in the home cities of the colonial masters. This architecture has largely not changed since independence except for what Dr. Kwame Nkrumah and the early patriots of Africa pioneered.
We may be able to encourage Africans to eat what we grow like maize, rice, millet, cassava but how will we use the Gold, Bauxite, Oil, Coltan, Manganese, Diamond, Timber and the host of Africa’s natural resources? AfCFTA must certainly not be a conduit to rob the poor for the rich. Certainly not! Two things could be great in the AfCFTA long term strategy in this regard; facilitate the environment for Africans to eat what we grow and grow what we eat and also support the establishment of huge African owned industries funded by African states to process our raw material into what we can use and trade at higher value with other trade blocs.
Secondly, in what currency will we trade under AfCFTA? US Dollar? Pound Sterling? Ghana Cedi? Chinese Yen? Zimbabwean Dollar? Naira? CFA?
What happened to the efforts at introducing the ECO currency at least for West Africans? Africa certainly needs a common currency to facilitate intra-Africa trade and AfCFTA must be pushing this agenda hard. The love for foreign currencies has contributed largely to the fall of local currencies in many African countries and the invariable destruction of those economies.
Who actually benefits if we make a choice of any of these currencies as our medium of trade? And the economics is quite simple, if everyone has to change their money into the Dollar for instance to transact business, it is the dollar that appreciates and America benefits in the end. And so for instance if the CFA becomes our currency of trade, France benefits hahahaha.
Having chronicled the above, AfCTA can be a game changer but must ensure it becomes a vehicle for Africa’s Economic Emancipation. We may be independent but the truth is we don’t control our natural resources.
Long Live the Dream of a truly Independent Africa! Long Live the African Dream.
Happy New Year…..