Premier of the Eastern Cape Province, Lubabalo Oscar Mabuyane and the Secretary General of the African Continental Free Trade Area (AfCFTA), Mr Wamkele Mene, agreed to work together to position the Eastern Cape economy to leverage trade, manufacturing, investment and tourism opportunities that will stem from the AfCFTA, during their bilateral meeting in East London.
This meeting was part of the Eastern Cape provincial Government’s efforts to expand its footprint of partnerships in the African Continent in pursuit of the provincial government’s economic growth targets. Through the implementation of the Provincial Development Plan (PDP), the Eastern Cape Provincial Government is implementing programmes to grow the Eastern Cape economy from a GDP Growth Rate of 0.8% to 5.0% by 2030; and increase investments from 16.5% of GDP to 27.1% of GDP.
Mene said he had a very good meeting with Premier Mabuyane where he introduced the AfCTA, potential for new trade opportunities created by the agreement for the province to be able to access new markets on the continent.
“It is a start of a relationship, a start of collaboration and the ultimate objective is job creation, fighting poverty, fighting underdevelopment by industrialising the province, the continent through the AfCTA. We also discussed potential value chains such as those in the agro- processing, automobile, and tourism sectors. All of these are potential areas for trade under this agreement,” said Mene.
The meeting agreed that Mene will visit the province again to see the East London SEZ as part of collaboration and working together with the provincial government to identify sectors of mutual benefit.
Mene said COVID-19 virus pandemic was a significant barrier for the continent’s economic growth because it slowed down the African continent with sub-Saharan Africa projected by the World Bank to experience a contraction in GDP for the first time in 25 years, affecting informal economy, the service sector; particularly the airline industry and the continent’s tourism sector because people were not travelling, resulting to less economic activity.
He said it was absolutely critical for the continent to take COVID-19 virus pandemic experience as the learning experience to accelerate industrialisation of the continent.
“One lesson we must learn from the COVID-19 virus pandemic is the acceleration of Africa’s industrial development for the continent to be self-reliant so that we can produce these ventilators and these germ killing products on the continent,” said Mene.
Mabuyane welcomed the opportunity to work with the AfCTA saying it will benefit Eastern Cape businesses who will now have access to markets in other countries within the African Continent.
“We had a very good meeting with Ambassador Mene. We are a province like any other province that stands to benefit from this opportunity that has been created by our Heads of States. The continent has been underdeveloped with a huge population of more than 1.2 billion, it’s a market on its own. If we start understanding and appreciating whatever we produce, manufacture from that value chain and value addition point of view, we should be able to get the meaning of what this platform (AfCTA) is all about,” said Mabuyane.
He said local businesses, particularly female headed businesses, young entrepreneurs have an opportunity of a life time through the AfCTA and the provincial government will support them to package their products for the African markets.
“We do have manufacturers here, particularly in the automobile sector, that have been focusing more on the European market in what they produce. We believe that if we look at Africa as the continent, we must start engaging more, develop our brands more and expand our footprint more. Already we have COEGA that is already having a footprint in a number of African countries in terms of the work they are doing on infrastructure development as consultants. That tells you in this part of the country we do have what it takes that is needed in the continent. We have to work together, collaborate and improve our collaboration,” said Mabuyane.
He said Eastern Cape Provincial government will present the province’s investment book to the AfCTA for them to help the province access more investors and markets on the continent in line with the economic priority and niche areas such as oceans economy, high value agriculture, tourism, manufacturing as part of the industrialisation of the provincial economy economic.
BACKGROUND INFORMATION ABOUT THE AFCTA
The AfCFTA came into existence when 54 members of the African Union signed the Agreement of its founding at the 12th Extraordinary Summit of the African Union (AU) in Niamey, Niger on July 7, 2019. Its key objectives include promotion of intra-African trade and further enhance competitiveness of member states within Africa and in the global market. It is also aimed at encouraging industrial development through diversification and regional value chain development, agricultural development and food security.
The United Nations Economic Commission for Africa estimates that the AfCFTA will boost intra-African trade by 52 percent by 2022. It has the potential to create a continental free-trade zone with a combined Gross Domestic Product (GDP) of USD$3.4 trillion, according to the African Union (AU). This trade agreement, if implemented fully, would become the largest in the world.