African officials gather in Egypt to talk mega trade pact

Egyptian President Abdel-Fattah al-Sisi (C) gestures as he gives a speech at the end of the Egypt economic development conference at the congress hall in the Red Sea resort of Sharm el-Sheikh on March 15, 2015 (File Photo: AFP)

Senior officials of three African economic blocs met in Egypt on Sunday to start hammering out details of a free trade agreement that could develop a common market spanning the continent.

The Tripartite Free Trade Area (TFTA) is to be launched at a summit of heads of state and government on Wednesday in the Red Sea resort town of Sharm el-Sheikh, aimed at establishing a common framework for tariff preferences along with other commitments.

The deal between the East African Community, Southern African Development Community and the Common Market for Eastern and Southern Africa will create a market of 26 countries with a population of 625 million and gross domestic product worth more than $1 trillion.

On Sunday, senior officials from the three economic blocs began discussing the details of the deal.

"Today, we opened the preparatory meeting of senior officials. Details of our discussions will be presented tomorrow at the meeting of ministers," Francis Mangeni, director for trade at COMESA told Agence France-Presse on the sidelines of the meeting.

The much-awaited TFTA has been widely welcomed by world business leaders, with experts highlighting the fact that just 12 percent of African countries' total trade is with each other.

Africa's share of global trade stands at around three percent.

The 26 members from the three economic blocs range from relatively developed economies such as South Africa and Egypt to countries including Angola, Ethiopia and Mozambique, which are seen as having huge potential growth.

Analysts say that although the continent's growth outstripped global GDP expansion by nearly three percentage points over the past 15 years, it faced falling commodity prices, power shortages, political instability and corruption.

Officials say the TFTA offers significant opportunities for business and investment within the three blocs and would act as a magnet for attracting direct foreign investment in the region.

The business community, in particular, will benefit from an improved and harmonized trade regime which reduces the cost of doing business as a result of the elimination of overlapping trade regimes, officials say.

"The launching of the TFTA is the first phase of implementing a developmental regional integration strategy that places high priority on infrastructure development, industrialisation and free movement of business persons," organisers said on the website of the June 7-10 conference.

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Last Update: Wednesday, 20 May 2020 KSA 09:46 - GMT 06:46
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