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BCN-07
WORLDBANK-IMF-TRADE
Africa could see ‘huge advantages’ from free trade pact: World Bank’s
Malpass
WASHINGTON, Oct 17, 2019 (BSS/AFP) – Countries in Africa stand to reap big
economic benefits from a continental free trade agreement but policymakers
will have to be pragmatic about the steps needed to implement it, World Bank
President David Malpass said Wednesday.
All but one of the 55 African nations have signed onto the AfCFTA pact
which is due to take effect July 1, 2020 to reduce tariffs and other trade
barriers in the region. So far 27 countries have ratified it, while only
Eritrea failed to join the pact.
“In order to make it work, I think pragmatism is going to be important for
the countries to find ways to implement the parts of the agreement that that
facilitate trade,” Malpass told reporters.
He stressed that facilitating the nuts and bolts of trade across borders
is as important as any trade agreement.
“This means harmonization of tariffs, and it means customs and border
processes that are efficient enough to allow goods to transfer across
borders. So I think those are key parts of making the African trade agreement
work well,” he said.
“I’m optimistic that there are huge advantages from trade.”
The International Monetary Fund has highlighted the potential benefits of
the trade deal, which would cover an estimated combined current GDP of $2.5
trillion, and a population of more than one billion, 60 percent of whom are
below the age of 25.
Reda Cherif of the IMF’s African Department said the region can get a lot
of benefit from changes that do not require the massive investments that
roads and ports would call for.
IMF research shows that “improved logistics would actually go a long way,”
having a big effect on trade, making this “low-hanging fruit” for countries,
Cherif said at a seminar on the sidelines of the IMF and World Bank annual
meetings.
And he noted that potential to see a big increase in trade on the
continent in manufactured goods.
The trade pact also “has the potential to raise Africa’s low productivity
and promote higher investment, thereby helping to increase income levels and
reducing poverty,” the IMF said in a report published in May.
BSS/AFP/HR/0930