By Varaidzo Zhakata
THE doom and gloom of the global economy have seeped into all layers, including the once shining sparkle across the continent.
The commencement of the African Countries Free Trade Area has however been postponed from the 1st July 2020 to at least 2021, as countries continue to adjust to the effects of Covid-19.
At the onset of the pandemic, policymakers were faced with a dilemma: push ahead or postpone? Both options have merits and pitfalls, creating a dilemma for policymakers.
This postponement is not entirely accepted as most African leaders are pushing for commencement to take place in the second half of this year so as to contain challenges, such as a scenario where other countries might pull out of the organization.
The 55-nation continental free-trade zone is expected to create a $3.4 Trillion economic bloc with 1.3 billion people across Africa and constitutes the largest new trading confederation in the world, after the World Trade Organisation (WTO).
With free trade, governments will have to yield revenue that would have been gained through the charging of import taxes (customs and excise).
Postponing the launch allows states to continue levying tariffs and retains the desperately needed revenue to fund higher debt service costs, as well as, healthcare and social support spent.
The global trade landscape is likely to change as countries process and mitigate the risks of an over-reliance on Chinese production and imports.
The crisis could just be the incentive; Africa needs to accelerate continental manufacturing, e-commerce, digitization, and food security.
All would be a benefaction for regional economic growth. Only through the AfCFTA can these ambitions be bodily realized.
The United Nations estimated in 2019 that the Africa Free trade agreement will boost African economies by 50% over the next 20 years.