Dubai continues to strengthen its position as a gateway for African trade, according to Ahmed Bin Sulayem, Executive Chairman & CEO of the Dubai Multi Commodities Centre.
Speaking during a session titled The Evolution of Global Trade, at the ongoing Global Business Forum Africa 2021 in Dubai, Bin Sulayem highlighted the need to accelerate procedures for economic integration between the African states taking part in the African Continental Free Trade Area (AfCFTA), as well as obstacles hindering its success.
He reiterated the importance of establishing comprehensive economic partnerships and benefit from Dubai’s leading position a strategic trade hub connecting Africa and the region.
“African countries have made remarkable progress under the Free Trade Agreement, and they must enhance their growth, building on the agreement, ensuring accelerated change, to develop their economic performance. Benefiting from successful experiences, these countries can identify challenges accurately, find necessary solutions, and achieve the transformation to bolster their position in global trade. Dubai offers a strong platform for African economies and products to enhance their international reach. We can support significant initiatives in Africa, further strengthening long-term relations,” said Bin Sulayem.
Also joining the session was Kebour Ghenna, the Executive Director of the Pan-African Chamber of Commerce and Industry (PACCI), who elaborated on the success of the trade agreement.
“AfCFTA has seen great progress: 54 countries signed to join and 37 fulfilled their commitments. In addition, members have shown remarkable mutual understanding on many trade and economic issues, promising further achievements in the near future. African states must not wait for all the procedures to be completed; there is a data gap to be addressed, challenges to be faced through a unified vision, and solutions to be developed before implementing the AfCFTA in the best manner.”
Dr. Deborah Elms, Founder and CEO of the Asian Trade Centre, concluded: “Africa has great potential and equally great challenges, which must be dealt with seriously considering the different interests and approaches of every country. In particular, the most impactful ones are interests related to investments, digital economy transformation, intellectual property, certificates of origin, and others. These issues need to be agreed upon to find a format that ensures the ease of business and drives growth.”
The 6th edition of GBF Africa which is organised by the Dubai Chamber in partnership with Expo 2020 Dubai was held under the theme Transformation Through Trade the two-day forum concludes today.
For investors, some of the important aspects to know about investing in Africa under the AfCFTA according to the World Bank are that:
- If successfully implemented, the AfCFTA could potentially add US$450 billion to Africa’s GDP over the next 10 years.
- With Covid-19 post-crisis recovery, the AfCFTA can accelerate economic growth which could offset some of the economic headwinds from the pandemic.
Investors should seize the opportunities offered by the trade agreement since globally, many nations are looking to Africa and the AfCFTA helps the continent lead the global trade agenda.
- The FTA is opening up infrastructure development opportunities which is key to successful trade growth.
Africa’s infrastructure gap is between US$130 and US$170 billion every year. This largely impedes intra-African trade which makes investing in infrastructure and transport linkages a priority to support the trade framework.
- The AfCFTA offers enormous opportunities in the construction sector with the outcome helping address infrastructural challenges by bridging the gaps.
- Additionally, investment opportunities in the food/agribusiness, healthcare and textiles sectors remain lucrative with the implementation of the AfCFTA.
Between 2006 and 2011, Africa had the highest rate of return on inflows of Foreign Direct Investment (FDI) at 11.4 per cent in comparison to Asia’s 9.1 per cent and 8.9 per cent in Latin America and the Caribbean.
The figures contained in a report by the UN Conference on Trade and Development show that Africa was the most profitable region in the world at that time.