TWENTY-ONE countries have already ratified the African Continental Free Trade (AfCFTA) agreement, billed as the largest free trade agreement that will allow Africa to have a single market for goods and services.
Only one country is remaining to meet the required threshold for the agreement to come into force, and many leaders from across the continent envision it as a powerful tool to foster growth, employment and industrialisation.
Leaders from governments and private sector at the Africa CEO Forum highlighted on Monday that there were immense challenges related to trade that the agreement could address.
Carlos Lopez, the former Executive Secretary of the United Nations Economic Commission for Africa (UNECA), said the cost of logistics in Africa is still a nightmare and until this is addressed, businesses will not thrive.
"The logistics of exporting from one African country to another is really brutal. It costs more to get goods to Mombasa from here [in Rwanda] than it costs from Mombasa to China," he said.
According to Lopez, two of the largest intra-African investors, South Africa and Morocco, create more jobs with their investments than India, UK and Germany combined, reflecting a different pattern in Africa.
"We have basically a different pattern when you have intra-Africa investors. We also have another important indication that the intra-African trade is on value addition whereas the African trade with the rest of the world is commodity-driven," he noted.
The University of Cape Town professor indicated that it currently takes up to 700 hours to process documentation at some African borders and costs 2,700 dollars a day to process documentation for import and export in some countries.
"This is unacceptable," he said, adding that these are some of the areas that the AfCFTA was looking to address.
He was speaking during a panel discussion on Monday morning alongside President Paul Kagame, Ethiopian President Sahle-Work Zewde, Abdulsamad Rabiu, CEO of BUA Group, IFC CEO Philippe Le Houérou, and Naguib Sawiris, the Chairman of Orascom Holdings.
Egyptian billionaire and businessman Naguib Sawiris said there were still a lot of challenges that private businesses were facing, highlighting lack of facilitation programmes in some countries.
"If I am an investor coming to Rwanda to invest in real estate and there is no mortgage programme, how will I sell the units that I have built?" he asked.
"But if the programme has been built and the ground has been prepared and all I need is to come and build and sell the units then I am in business," he added,
While he was optimistic about the AfCFTA, Sawiris, who is also the Chairman of Orascom Holdings, expressed concern about the implementation process of an agreement of that nature in Africa.
"When governments sign something then we need to go and deal with bureaucrats. When we, the private sector, reach out to governments they are always suspicious. They think we are coming to take money and leave," he said.
"The intention is not bad. You definitely want to do business, make profit but also contribute to developing the country through job creation," he added.
AfCFTA is set to increase intra-African trade by 52 per cent by the year 2022, remove tariffs on 90 per cent of goods, liberalise services and tackle other barriers to intra-African trade, such as long delays at border posts.
Nigeria's business mogul Abdulsamad Rabiu argued that with AfCFTA there will be more winners than losers in Africa if the agreement is correctly implemented and that players like him were willing to be part of the process.
His company, BUA Group, deals in cement, sugar, flour, real estate, steel, oil gas and shipping.
Ethiopian President Sahle-Work Zewde told the gathering that her country is an example of what could be achieved if countries integrate, despite Ethiopia having faced compliance issues with the several economic groupings it belongs to.
"Ethiopia is a good example. In our history, we belong to many economic groupings but in some areas, we were there but not fully there. Compliance and some rules have been very difficult. But we have understood that there is no any other alternative than integration," she noted.
"It is not only with AfCFTA. The recent past would show you that normalising our relationship with our immediate neighbours, especially the northern neighbour Eritrea, opened the door to a better integration of the region. A bigger, stable region we can have," she added.
President Kagame, however, said the agreement will not address problems until people make it work.
"AfCFTA does not solve problems until people make it work. We don't expect to put a mechanism and expect it to work; it needs an effort that people will have to undertake to make it work," he said, highlighting the importance of political will.
The forum, which brings together business leaders, academics and leading policymakers on the continent and beyond, attracted over 1800 delegates, including chief executives of leading corporations.