This archive report was first published on 9 July 2019.
On July 7, 2019, at the African Union Summit in Niger, Nigerian President Muhammadu Buhari signed the continent's largest economy onto the African Continental Free Trade Area, marking a significant milestone in the continent's economic integration.
The deal, which aims to create the world's largest free trade zone, a 55-nation bloc worth $3.4 trillion, has been months in the making. Nigeria's support gives weight to forming the trade zone, with Pat Utomi, a member of the Nigerian negotiating team, stating, 'Nigeria stands to profit and other African countries stand to profit also from Nigeria's participation.'
Utomi's sentiments were echoed by Okey Oramah, president of the African ExportImport Bank, who noted that the pan-African payment system launched at the summit will reduce the use of third currencies in bilateral trade settlement, estimated to cost Africa between $5 billion and $7 billion.
However, despite the launch of the free trade area, much work remains before the agreement becomes effective. While all 55 African Union members except Eritrea have signed on to the deal, only half have ratified it. Non-tariff barriers, such as corruption and poor transport links between nations, will also need to be addressed.
