Let’s use Africa Day to increase cross-border trade
AFRICA Day, on Saturday, is the perfect opportunity to celebrate Africa’s progress and growth.
It is also a day to reflect on the ways each person and country on the continent can work together to drive social and economic development.
One of the questions we should be asking is: How can the African community unlock more economic growth through closer cross-border trade ties and co-operation?
Consider the fact that intraAfrican exports made up only 18% of total exports across the continent, compared to around 60% each for intra-Asia and intra-Europe exports.
The African Continental Free Trade Area agreement, signed by 44 African nations, is a promising step towards redressing this picture.
By harmonising regulations and tariffs across countries to create a common market, we can one day create a trading bloc that is as powerful and coherent as the European Economic Area. It is a project that will span decades, but in the interim, there is much we can do to catalyse growth and trade.
We Power the Nation – an independent survey commissioned by Sage – shows South African companies are already driving exports to the rest of the continent. More than half (55%) are exporting to the Middle East and Africa.
According to the respondents, the top three actions government can take to better support aspirations to increase international trade are:
Developing opportunities in international markets (37%).
Providing investment incentives and funding (36%).
llRemoving trade barriers (35%). We believe businesses in other African countries would share these convictions.
Another focus should be for each country to develop its internal market by supporting local businesses, particularly services companies and manufacturers that are helping to diversify economies from Africa’s traditional strengths in commodities and agriculture.
Domestic demand is the foundation of a resilient, creative business sector that can grow into an export powerhouse.
We call on governments and big business in Africa to support their innovative local businesses – whether these are fintech companies in Nairobi, Nollywood film producers or entrepreneurs investing in clean, renewable energy. Such companies can help African countries become
lmore competitive, create jobs and grow the tax base.
I am proud to celebrate Africa Day, which coincides with the inauguration of Cyril Ramaphosa as South Africa’s president.
Many African heads of state and Southern African Development Community representatives will be in attendance, reminding us of the close ties shared by this continent’s nations and the importance of collaborating ever more closely on trade and the economy.
I have a strong belief in this continent and what it can offer to the rest of the world. With a dynamic, youthful population and a growing internal consumer market, Africa is one of the most exciting places to be right now.
Bensch is executive vice-president at Sage Africa and the Middle East.