KIGALI, Mar. 16 (Xinhua) -- The envisaged African Continental Free Trade Area (AfCFTA) will benefit Africa in terms of business and industrialization, although operational challenges remain, a Rwandan official said Wednesday.
The expected creation of the AfCFTA could more than double the share of Africa's trade within itself by 2022, Rwandan Minister of Trade and Industry Vincent Munyeshyaka told Xinhua in an interview.
The AfCFTA will also reduce the cost of doing business among African countries, create business opportunities, promote industrialization and increase production in Africa, he said.
An extraordinary summit of the African Union (AU) on the AfCFTA is scheduled to be held in Kigali on March 17-21, where leaders of Africa's 55 countries are expected to sign an agreement to launch the AfCFTA, according to the AU.
Munyeshyaka noted that the free trade area will also create jobs and reduce unemployment rates, support sustainable economic development and improve the livelihood of all Africans.
"From the academic theories and experiences across the world, trade has been proved to be an obvious engine for economic growth. The AfCFTA is meant to increase intra-Africa trade and economic integration of African countries," said the minister.
He said the AfCFTA is designed to attract investment from across the world and will also help Africa's self-sustainability.
The single market of more than 1.2 billion consumers has the potential to attract multinationals from other parts of the world to Africa, said the minister.
Statistics from the AU show that currently Africa trades far less within itself than it does with the rest of the world. Intra-Africa trade stands at about 16 percent of the total on the continent, compared with 19 percent intra-regional trade in Latin America, 51 percent in Asia, 54 percent in North America and 70 percent in Europe.
The AfCFTA will make Africa the largest free trade area created since the formation of the World Trade Organization, according to the pan-African bloc.
The United Nations Economic Commission for Africa estimates that the AfCFTA has the potential to boost intra-Africa trade by 53 percent by eliminating import duties and non-tariff barriers.
Munyeshyaka said that before the AfCFTA enters into force, AU member states will need to ratify it after it is signed.
It could be a challenge to fast track the ratification process and transformational changes brought by the AfCFTA may face resistance, he said.
Munyeshyaka explained that there is a need to promote investment along with the AfCFTA, as investment may not follow its creation.
The creation of the AfCFTA should be followed by industrialization and infrastructure policies across Africa, which could also pose a challenge to the operation of the free trade area, he added.
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