Business News of Wednesday, 19 June 2019
African countries have been urged to work towards a more favourable regulatory framework that improves processes which will ultimately lead to increase in trade among the respective countries.
Alain Raes, Chief Executive, EMEA & APAC, SWIFT, who made the call in an interview, said the elimination of various barriers to trade would ensure effective regional integration and a boost to intra-African Trade.
He said the many border and customs posts and the associated bureaucracy and delays, continue to hold back trade and economic growth.
The high number of checkpoints, he said were impeding trade and needed to be addressed as it added to the cost of doing business.
He said African countries must also leverage technology to enhance the payment system and to facilitate trade among African countries.
SWIFT, he said, had expanded to more African countries and ensuring that banks on the continent were connected among themselves and to the rest of the world.
He said discussions were held with some banks in Ghana, Nigeria among others to help them to develop and operate high-value domestic payment systems.
In his welcome address, Mr Sido Bestani, Regional Director, Middle East, Turkey Africa, SWIFT said while intra-African trade was still below 15 percent, there were some promising signs of this turning around, based on SWIFT data, published last year.
He said the recent signing of the Continental Free Trade Area (CTFA), the largest trade agreement since the launch of the World Trade Organisation in 1995, was a major step towards building a ‘borderless Africa’.
It is estimated that if all 55 African states were to sign the deal, it would cover a market of more than 1.2 billion people, including; a growing middle class, and a combined GDP of more than $3,400 billion with the potential to boost intra-African trade by more than 52 percent through the elimination of import duties.
Economists argue that increased trade could be doubled if non-tariff barriers were also reduced.
“It’s a step forward, but there is some way to go,” he said.