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00:01 Um,

00:01 His Excellency will join very soon,

00:02 please.

00:07 Thank you.

00:10 Hello,

00:10 can you hear me,

00:11 please?

00:16 Yes,

00:16 we can,

00:16 we can hear you,

00:17 Samuel.

00:18 We heard that.

00:18 Thank you very much.

00:19 Yeah,

00:20 thanks for the confirmation.

01:22 I and Jason,

01:23 we need to wait for Mona before we go live.

01:25 So just,

01:26 just so you know.

01:29 Understood.

01:30 No,

01:30 no worries,

01:31 it's already running.

01:32 Um,

01:33 attendees are joining,

01:34 so whenever you're ready to start.

01:36 OK.

01:37 I know Mona Mona is here.

01:39 Um,

01:41 Mona,

01:41 just a quick note that we have uh simultaneous translation,

01:45 so you can mention that to the participants.

01:47 If they feel more comfortable,

01:48 they can

01:49 click an icon with the globe,

01:51 and that's where they will be taken to listen to the French version of the event.

02:00 Can you say that again,

02:01 Marilla?

02:03 Sorry,

02:03 Amana,

02:03 I was just saying that we have secured the simultaneous translation

02:08 um

02:09 to French,

02:10 so you can mention to the participants that if they want to be,

02:14 um,

02:14 they,

02:14 they would prefer to listen to the event in French,

02:17 that they need to click an icon with the globe at the bottom of the screen,

02:22 and they can listen in French instead.

02:26 Thank you.

02:31 So can we start?

02:37 Yep.

02:57 OK.

02:58 All right.

03:02 So,

03:03 good afternoon,

03:04 everyone.

03:05 And uh good afternoon,

03:07 um,

03:08 Your Excellency,

03:10 Honorable Secretary General

03:13 Mene,

03:13 um,

03:14 our World Bank Managing Director,

03:17 Doctor Marri Pangestu.

03:19 Uh,

03:20 representatives of the trade ministry,

03:22 um,

03:23 uh,

03:24 from Tunisia.

03:25 Um,

03:26 Mr.

03:27 Habisha and Jabali.

03:31 Uh,

03:31 very warm welcome to our panelists,

03:34 uh,

03:34 Edem

03:35 Azogenu of AfroChampions.

03:39 Uh,

03:39 Mr.

03:40 Dave Coffey of the African

03:42 Association of Automotive Manufacturers,

03:45 and

03:46 the IFC Director for Sector Economics,

03:49 Mr.

03:49 Issafai.

03:51 And warm welcome to all of you for joining us today.

03:56 Uh,

03:56 the ACFTA,

03:58 uh,

03:58 is an extremely

04:00 important initiative.

04:01 It can have transformative,

04:04 uh,

04:04 impacts,

04:05 uh,

04:05 for the,

04:06 for the development of Africa.

04:08 And we are very,

04:09 very happy to have,

04:10 uh,

04:11 this,

04:11 um,

04:12 seminar with you to show you,

04:14 uh,

04:15 some of the results of our,

04:17 uh,

04:17 work on,

04:18 on the ACFTA.

04:19 My name is Mona Haddad,

04:21 uh,

04:21 and I'm the global director for trade,

04:23 investment and competitiveness at the World Bank.

04:27 This study that I was mentioning has

04:29 been done in collaboration with the ACFTA Secretariat

04:34 and has greatly benefited from the guidance of His Excellency,

04:38 Secretary General,

04:40 Mr.

04:40 Wamkele

04:41 Mene.

04:42 We very much appreciate that you are here.

04:45 Thank you very much,

04:46 Your Excellency.

04:47 In addition to our numerous trade-related operations currently

04:52 ongoing at the country level across Africa,

04:55 the World Bank Group has been engaging with

04:57 the ACFTA Secretariat and the Regional Economic Communities

05:01 in their efforts to reduce barriers to economic integration

05:05 in Africa.

05:07 Uh,

05:07 let's start with a welcome from the World

05:09 Bank director for Regional integration in Africa,

05:13 uh,

05:13 Ms.

05:13 Buthaina Germazi,

05:15 who could not be with us today,

05:17 but will be making a pre-recorded welcome.

05:19 So over to you for

05:21 um

05:23 For the recording,

05:24 please.

05:37 Good afternoon everyone.

05:39 It is my pleasure to welcome you all to the launch of a pivotal report.

05:44 The report has been produced by a partnership

05:47 between the AFCFTA Secretariat and the World Bank.

05:51 is an analysis of how the African Continental Free Trade Area Agreement

05:56 can boost growth and reduce poverty

05:59 by leveraging trade and foreign direct investments.

06:04 This report has benefited from the comprehensive guidance of His Excellency

06:10 Wam Kelly Pen,

06:11 the Secretary General of the AFCFTA Secretariat.

06:15 I would like to express our deep appreciation

06:19 for his visionary leadership in building the AFCFTA Secretariat

06:24 as the powerhouse fueling continental economic integration in Africa.

06:31 As an expert in international trade law,

06:33 he served law firms in London and Hong Kong prior to joining government.

06:38 He headed the South African mission to the WTO

06:41 and was South Africa's lead negotiator

06:44 in the AFCFTA.

06:47 The topic of the report is very dear to my

06:49 heart as the director for Regional integration in the World Bank

06:53 covering Africa

06:54 and the Middle East and North Africa regions.

06:57 The AFCFTA agreement promises to be a game-changer for regional integration

07:03 and consequently for growth and development in Africa.

07:08 It enables countries to overcome impediments to the free flow of goods,

07:13 services,

07:14 capital,

07:14 people,

07:15 and ideas.

07:16 Freer exchange across borders can

07:19 accelerate social and economic development.

07:24 Several sub-regional agreements on trade and investment facilitation

07:27 in smaller blocs do exist in Africa.

07:30 However,

07:31 the continent-wide scale of the AFCFTA

07:35 and its ambition to build an all-Africa synergy in trade

07:40 is unique

07:41 and laudable.

07:43 An open continental market with lower tariff and

07:46 non-tariff barriers for trading goods and services,

07:49 as well as fit for purpose rules on investment,

07:53 on competition,

07:54 intellectual property,

07:56 and e-commerce,

07:57 will help make Africa more competitive,

08:00 attract investment,

08:01 industrialize economies,

08:03 and reduce dependence on imports.

08:05 With this confidence in the promise of the AFCFTA,

08:09 the World Bank Group is stepping up

08:10 its engagement with the African Union Commission,

08:13 with the AFCFTA Secretariat,

08:15 and with regional economic commissions to support a faster

08:19 and better economic integration of Africa.

08:24 Today's event is just one link in the broader chain

08:27 of development cooperation between the bank and the AFCFTA Secretariat.

08:31 We were delighted

08:33 to have the opportunity to support the AFCFTA process

08:36 through analytics such as the report being launched today,

08:40 negotiation support,

08:41 compiling data and tools required to enable governments to negotiate commitments

08:46 and monitoring implementation.

08:49 Proper implementation is vital

08:52 to ensure that the benefits of the AFCFTA reach the last mile.

08:57 Focusing on tangible results will require concrete

09:00 activities and policy actions at national,

09:03 regional and

09:05 continental levels.

09:07 We look forward to continuing our close collaboration with the AFCFTA Secretariat

09:12 to support effective implementation of the AFCFTA treaty and protocols

09:17 and unlock its benefits for Africa and for the world.

09:22 I thank you for your attention and wish you all a good discussion today

09:26 on the rollout of the FCFTA in an effective

09:29 and efficient manner

09:31 across the continent.

09:36 Many thanks to Bina and as her role

09:40 of regional director for Africa,

09:43 we

09:44 heard the commitments of the World Bank to engage

09:47 with the African continent and make

09:50 this ACFTA

09:51 actually happen.

09:53 So I now turn to His Excellency Secretary General Mene,

09:58 who will make an opening address.

10:00 Secretary General Mene is an expert in law,

10:03 particularly international trade law.

10:06 He was the head of the South African mission to the WTO.

10:10 He also chaired the Committee on International

10:12 Trade of Financial Services at the WTO.

10:16 He was South Africa's lead negotiator in the ACFTA

10:20 and Chief Director

10:23 for Africa Economic relations in South Africa's Department of Trade and Industry.

10:27 Your Excellency,

10:28 the floor is yours,

10:29 and thank you again for joining us.

10:32 Thank you very much,

10:34 uh,

10:34 indeed for,

10:35 um,

10:36 uh,

10:36 for

10:37 inviting

10:38 me to participate in this event.

10:41 Um,

10:41 and thank you very much to the World Bank for the partnership

10:45 and,

10:46 uh,

10:46 the continued,

10:47 uh,

10:47 collaboration which started really,

10:50 um,

10:50 at the beginning of the negotiations.

10:53 And I want to thank in particular,

10:54 Roberto for his tireless efforts

10:57 to make sure that

10:59 we get the support that we needed,

11:02 uh,

11:03 to,

11:03 to,

11:03 to,

11:04 to reach

11:05 this

11:05 point of,

11:06 uh,

11:07 immense progress

11:08 that we have reached in less than 5 years.

11:11 And so,

11:11 I want to really express my very,

11:14 very sincere

11:15 appreciation to Roberto and his team,

11:18 uh,

11:19 who have worked,

11:19 as I say,

11:20 tirelessly over the last 5 years.

11:22 To support the work,

11:23 uh,

11:23 that we do.

11:25 Yesterday,

11:26 just yesterday,

11:27 I spoke at an event

11:29 and,

11:30 and I

11:31 reiterated

11:32 some of the very positive projections

11:35 from the 2020 report.

11:39 Uh,

11:39 today we have a new report,

11:41 which,

11:41 which is even more encouraging

11:43 in terms of its projections

11:45 about the AFCFTA.

11:48 Uh,

11:49 particularly

11:50 the,

11:51 um,

11:52 the AFCFTA as an enabler

11:55 for pushing back on the frontiers of poverty,

11:58 particularly

11:59 for,

12:00 um,

12:00 for women-led businesses,

12:02 closing the gender gap,

12:04 lifting millions and millions

12:06 of Africans out of poverty,

12:08 uh,

12:08 through

12:09 a trade instrument.

12:10 And I think that

12:12 there could not be a much more powerful

12:14 symbol

12:15 of what

12:17 Trade liberalization can do

12:20 for a country or a region or a continent's,

12:23 uh,

12:23 economic outlook.

12:25 I think these projections,

12:27 these very positive projections,

12:29 uh,

12:29 uh,

12:29 underscore

12:31 the importance of trade

12:32 and of course,

12:33 what we all know,

12:35 the,

12:35 the positive link between trade and,

12:38 uh,

12:38 development.

12:40 Let me give you a few,

12:42 uh,

12:42 uh,

12:42 let me for a few minutes,

12:44 give you an update

12:46 of where we are in the implementation of the AFCFTA

12:50 and why the report,

12:52 uh,

12:52 matters,

12:53 uh,

12:53 so much.

12:55 When we last spoke,

12:57 virtually,

12:58 when we had a similar event virtually in 2020,

13:01 as

13:02 we had at that time,

13:04 uh,

13:04 maybe a handful of countries

13:06 who had ratified the agreement establishing the AFCFTA.

13:11 Today,

13:11 we have 43 countries

13:13 that have ratified the AFCFTA.

13:17 We have only one country that has not signed the agreement.

13:22 To me,

13:23 this demonstrates

13:25 political will,

13:27 and of course,

13:27 it demonstrates legal commitment

13:30 to reduce barriers to trade

13:32 in Africa,

13:33 to reduce barriers to investment.

13:36 To tackle

13:37 long-standing challenges of industrial development on the African continent,

13:42 and of course,

13:43 using trade

13:44 as a tool,

13:46 uh,

13:46 for,

13:46 uh,

13:47 achieving regional and,

13:49 and global competitiveness.

13:51 And so,

13:51 it's clear in my mind that with these 43 countries that as we speak,

13:55 have ratified the agreement,

13:57 Uh,

13:57 that we will,

13:59 we have the requisite political will

14:01 that,

14:01 uh,

14:01 we need to,

14:03 to make even more progress

14:05 than we have achieved,

14:06 uh,

14:06 thus far.

14:08 We have,

14:09 um,

14:10 a,

14:10 an agreement that is very comprehensive in scope,

14:13 as you may be aware.

14:15 Uh,

14:16 we are negotiating the agreement in phases,

14:18 in phase 1 and in phase 2.

14:21 Phase one of the agreement includes trade in goods,

14:24 trade in services,

14:26 And dispute settlement.

14:28 These are the three

14:29 protocols

14:31 in phase one.

14:32 We have started

14:34 operationalizing the protocol on dispute settlement.

14:38 We are in the process of,

14:39 of appointing,

14:40 uh,

14:40 members of the appellate body

14:42 because we understand the significance,

14:45 and the importance

14:46 of predictability of markets,

14:49 certainty of markets,

14:51 the rule of trade law,

14:53 and of course,

14:54 um,

14:55 in this case,

14:56 the trade law being

14:58 the AFCFTA.

14:59 So,

14:59 the,

15:00 the protocol on

15:02 dispute settlement is well in the way of being operationalized and,

15:05 and being implemented.

15:07 Uh,

15:08 the protocol on,

15:09 uh,

15:10 trade in services.

15:12 Here,

15:12 we are,

15:13 um,

15:14 not making as fast progress as we are

15:17 in dispute settlement and in,

15:20 uh,

15:20 trade in goods,

15:21 which I will come to in a moment.

15:22 And that's to be expected,

15:24 uh,

15:24 because of the nature of the complexity

15:27 of,

15:27 uh,

15:28 trade and services agreements,

15:30 uh,

15:30 uh,

15:30 uh,

15:31 trade and services negotiations,

15:32 which require

15:33 Um,

15:34 extensive national consultations with regulators,

15:38 with professional,

15:39 uh,

15:39 bodies,

15:40 uh,

15:40 and a range of other domestic stakeholders.

15:43 However,

15:44 we do have 29 countries that have made,

15:48 uh,

15:48 offers,

15:49 uh,

15:49 services offers.

15:50 So the negotiations are,

15:52 are ongoing,

15:54 uh,

15:54 and we expect that by the end of the year,

15:57 we will see even more,

15:58 uh,

15:59 progress.

16:00 In the area of trading goods,

16:01 this is also where we have made tremendous progress.

16:05 We have reached agreement

16:08 on 88.87%,

16:12 I'm sorry,

16:12 88.8%

16:14 uh

16:15 convergence on rules of origin.

16:17 If you think about it,

16:19 In Africa,

16:20 we trade close to 5000 products,

16:23 close to 5000 products that we have been trading

16:26 using different rules,

16:28 uh,

16:28 from this region

16:29 to that region,

16:30 or of course,

16:31 using MFN rules,

16:33 WTO

16:34 rules.

16:35 We now have reached convergence

16:38 for preferential trade

16:40 on 88.8%. Rules of origin and that is,

16:45 is significant.

16:46 We are still negotiating the automotive sector,

16:49 which is about 1.3% of our tariff book.

16:53 We are still negotiating textiles and clothing,

16:56 which is about 13%.

16:59 And then

17:00 there's a scatter of uh different tariff lines

17:04 such as edible oils,

17:07 sugar,

17:07 and so on,

17:08 where we still need further negotiations.

17:12 The point is,

17:14 um,

17:14 we are as close to 90%,

17:17 uh,

17:17 as we possibly can be at this point,

17:21 and

17:22 we

17:23 have to start trading on the basis of these agreed rules of origin.

17:28 In less than 5 years,

17:30 uh,

17:30 we have been able to achieve this progress.

17:33 Um,

17:34 2 years of a pandemic.

17:37 So it has been incredibly difficult,

17:39 but,

17:39 uh,

17:40 I believe that we are now ready.

17:43 Um,

17:43 we've established the legal foundation,

17:46 that is the protocols that I've just mentioned.

17:49 Um,

17:50 we have the trading documents.

17:52 Uh,

17:53 we have certificates of origin.

17:55 Uh,

17:55 we have,

17:55 um,

17:56 origin declaration documents.

17:59 Uh,

17:59 next month,

18:00 we will publish the AFCFTA tariff book,

18:03 uh,

18:03 which is important for transparency and predictability

18:08 of traded products.

18:10 And so I believe

18:11 that with these um components,

18:14 uh,

18:14 we are indeed,

18:16 uh,

18:16 uh,

18:16 well on the way

18:18 to,

18:18 uh,

18:19 uh,

18:19 commercially meaningful trade.

18:22 So from our point of view,

18:23 phase one is almost concluded.

18:26 Of course,

18:27 uh,

18:27 at national level and regional economic level,

18:30 which is customs unions,

18:32 that's where

18:34 the rubber hits the road.

18:35 That's where we expect the implementation to happen.

18:39 That's where we expect

18:41 the trade to happen.

18:43 We have been working very closely

18:45 for the last 2 years with heads of customs authorities in Africa.

18:52 This year alone,

18:53 we have had about 5 or 6 meetings

18:55 with customs authorities

18:57 so that we improve their capacity

19:00 to implement the agreement,

19:02 enhance their understanding

19:04 of the obligations under the agreement.

19:07 And

19:08 uh give them the due recognition

19:10 that they deserve

19:11 that customs authorities

19:13 will really be at the cutting

19:15 edge

19:15 of implementation of this agreement.

19:18 And so,

19:19 we are working very,

19:20 very closely

19:21 with customs authorities who are required

19:23 and are very important

19:25 for implementation of the AFCTA.

19:28 We're also working very closely with customs authorities

19:31 and regional economic communities.

19:34 We have just had a meeting,

19:35 uh,

19:35 two months ago

19:37 of regional economic communities,

19:39 uh,

19:39 where we discussed this issue of coordination

19:42 in the implementation

19:44 of the AFCFTA.

19:47 Now,

19:48 phase two

19:49 is,

19:49 um,

19:50 all of the issues that,

19:53 um,

19:54 we were directed by the heads of states to

19:57 include

19:58 in the legal architecture of the agreement

20:01 as a complementary

20:03 to the trade liberalization that we want to see.

20:06 And phase two includes

20:08 a protocol or protocols

20:10 on investment.

20:12 That is to say,

20:13 investment protection and facilitation.

20:16 On digital trade,

20:17 on intellectual property rights,

20:20 on competition.

20:21 And more importantly,

20:23 for inclusion,

20:24 a protocol on women and youth in trade.

20:28 We started this negotiation of the phase 2 protocols

20:33 late last year.

20:34 We were delayed by the pandemic,

20:37 and now that negotiation

20:39 is proceeding.

20:41 We have a deadline to conclude

20:44 these protocols

20:45 by the end of September this year.

20:49 We believe

20:51 that,

20:51 uh,

20:51 this comprehensive approach

20:54 of including

20:55 the traditional areas

20:57 of trade,

20:58 trade in goods,

20:59 trade in services,

21:00 as well as digital trade,

21:03 um,

21:04 a protocol on digital trade which will embed

21:07 into legally binding obligations,

21:09 a regulatory framework.

21:12 For electronic trade and commerce,

21:14 uh,

21:15 in Africa,

21:16 uh,

21:16 which will include,

21:17 uh,

21:18 uh,

21:18 payments,

21:19 uh,

21:20 regulations on payments,

21:22 the data processing and the movement of,

21:24 um,

21:24 of,

21:25 of,

21:25 of data

21:26 across,

21:27 uh,

21:28 countries in the AFCFTA,

21:30 uh,

21:30 uh,

21:31 state parties.

21:32 It's a very important uh tool,

21:34 especially as we all know,

21:36 uh,

21:36 given the pandemic,

21:38 but also,

21:39 more importantly,

21:41 given the fact that

21:42 Africa,

21:43 as you know,

21:44 has been,

21:45 um,

21:45 at the,

21:46 at the,

21:46 uh,

21:47 really at the center

21:48 of technological and digital advancements.

21:51 You will remember

21:53 that,

21:53 um,

21:54 the first country to ever introduce mobile payments uh in the world,

21:58 uh,

21:59 is,

21:59 uh,

21:59 is Kenya

22:01 through M-PESA,

22:02 which has,

22:03 which has really revolutionized

22:06 how trade

22:07 um

22:08 and has ensured that trade.

22:11 Reaches millions and millions of people,

22:13 uh,

22:13 and has ensured that we see

22:16 inclusion

22:17 of trade and finance,

22:19 uh,

22:19 through this,

22:20 uh,

22:20 uh,

22:21 mobile enabled,

22:23 uh,

22:23 technology.

22:24 And so,

22:25 these are the areas that we want to capture

22:27 in the protocol

22:28 on digital trade.

22:31 There are other tools that we have introduced

22:34 because uh

22:36 we have a very unique context

22:38 in Africa.

22:39 We cannot just negotiate

22:42 a trade agreement and leave it.

22:44 We have to introduce

22:46 complementary tools for implementation

22:49 of the trade agreement.

22:51 And I will take a minute

22:53 to mention just a few.

22:55 First,

22:56 um,

22:57 is the Pan-African Payments and Settlement System,

23:00 which along with African Bank,

23:02 uh,

23:03 we,

23:03 uh,

23:03 launched on the 13th

23:05 of January this year here in Accra.

23:08 And really,

23:09 the Pan-African Payments and Settlement System takes account of

23:12 the cost

23:13 of currency convertibility,

23:16 the challenge of,

23:17 uh,

23:17 um,

23:18 uh,

23:18 inefficiency

23:20 of having

23:21 42 currencies

23:23 and the impact that has on trade.

23:25 Uh,

23:26 as well as the need for inclusivity,

23:30 particularly for small medium enterprises

23:32 and young entrepreneurs.

23:34 We now have 48 commercial banks that are trading on the platform.

23:38 Uh,

23:39 uh,

23:39 you,

23:40 you can be in Accra

23:42 and trade with somebody,

23:44 um,

23:44 in another part of the continent.

23:47 You can be in Accra

23:49 and you trade with your counterparty

23:51 in Egypt

23:52 using your local currency,

23:54 Ghanaian CD.

23:55 Your counterparty that you transact with

23:58 in,

23:58 uh,

23:59 Egypt will receive,

24:01 uh,

24:01 in Egyptian pounds.

24:03 And so,

24:04 the,

24:05 first of all,

24:05 the,

24:05 the,

24:06 the,

24:06 the first objective of the payment system

24:09 is to ensure we,

24:11 that we

24:12 enhance

24:13 competitiveness of our small medium enterprises,

24:17 as well as ensure inclusivity.

24:20 By

24:21 spreading this

24:22 availability of this tool to as many people as possible

24:26 so that they can trade

24:27 across regions and across borders.

24:30 This will be a game changer for trade on the African continent.

24:35 42 currencies is

24:37 a constraint

24:38 to

24:39 to trade.

24:40 It presents unnecessary costs

24:42 to trade.

24:43 $5 billion by our estimate

24:46 is the cost of currency convertibility

24:48 as a result of relying on a third currency

24:53 when we want to trade amongst one another as Africans.

24:56 The second important tool.

24:58 Is the AFCFTA adjustment fund.

25:01 And through the AFCFTA adjustment fund,

25:04 um,

25:05 we intend to assist countries

25:07 who will,

25:08 uh,

25:09 in one way or the other,

25:10 suffer adjustment costs as a result of implementation

25:14 of the AFCFTA.

25:16 We know that,

25:17 um,

25:17 uh,

25:17 not,

25:18 not all countries

25:19 will be immediate beneficiaries

25:22 because,

25:23 uh,

25:23 countries

25:24 on our continent are at different levels

25:26 of industrial capacity.

25:29 Different levels,

25:30 uh,

25:30 of export,

25:31 uh,

25:31 readiness or export capacity.

25:34 And so we have to take account of that,

25:36 and we have to take account of the fact that many countries

25:40 continue to rely

25:41 on,

25:41 um,

25:42 on,

25:42 on tariffs as a revenue generating tool.

25:46 So,

25:46 as they eliminate their tariffs,

25:48 as they reduce and eliminate their tariffs,

25:51 we have to find,

25:52 uh,

25:52 other ways

25:53 of providing them with the support that they need.

25:56 But the AFCFTA adjustment fund is not going to be,

26:00 it's not intended for budget support.

26:03 It is intended for productive sector,

26:05 uh,

26:06 support

26:07 to an industry,

26:08 in country

26:09 or to a,

26:11 a sector.

26:13 A country may decide that,

26:15 um,

26:15 we would like to retrain our workers

26:18 and deploy them

26:19 in another part of the economy.

26:22 Uh,

26:23 an example is,

26:24 I have just come back two months ago from Lesotho,

26:27 and there's a very,

26:28 very globally competitive,

26:30 uh,

26:31 globally competitive manufacturing plant.

26:33 They manufacture,

26:35 um,

26:35 uh,

26:36 uh,

26:36 car seats.

26:38 Employing over 750 people,

26:41 many of them women,

26:43 paying decent salaries,

26:45 but the government had to

26:49 invest significant amounts

26:51 to train

26:53 the workers who were going to be

26:56 employed in that

26:58 factory.

26:59 Which is part of an automotive value chain.

27:02 Uh,

27:03 and so,

27:04 the adjustment fund is envisaged

27:06 in such a way that,

27:08 uh,

27:08 in the example that I cite of Lesotho,

27:11 the government of Lesotho would have had access to the fund,

27:14 to the AFCFTA adjustment fund,

27:16 so that the workers are retrained

27:18 and that they are deployed,

27:20 um,

27:20 in,

27:21 in decent paying jobs

27:22 that require a high level of skill

27:25 and,

27:25 and,

27:26 and training.

27:27 The 3rd area,

27:28 uh,

27:29 the 3rd tool rather,

27:30 rather,

27:30 which is also very important.

27:33 Is

27:33 um the trade finance facility.

27:37 Trade finance facility,

27:38 which we're in the process of negotiating

27:41 to enable small-medium enterprises,

27:43 particularly those that are led by women,

27:46 um,

27:46 and young entrepreneurs

27:48 to have access,

27:49 uh,

27:49 to,

27:50 uh,

27:50 the entire African market.

27:53 Uh,

27:53 the cost

27:54 of trade finance is very high.

27:56 Uh,

27:57 the access to trade finance is very low.

28:00 Um,

28:01 some commercial banks do have,

28:03 uh,

28:03 trade finance portfolios,

28:05 but as we all know,

28:06 the,

28:07 the uptake is very,

28:08 very low.

28:09 And so we have to do more.

28:10 We have to mobilize our development finance institutions,

28:14 uh,

28:15 the African Development Bank,

28:16 African Bank,

28:17 and others,

28:18 and others

28:19 to ensure that,

28:20 um,

28:21 access to trade finance

28:23 is,

28:23 uh,

28:24 improved,

28:25 working with,

28:26 uh,

28:26 uh,

28:27 all relevant,

28:28 uh,

28:28 uh,

28:28 uh,

28:28 stakeholders.

28:30 Your Excellency,

28:32 uh,

28:32 this is,

28:33 uh,

28:33 so I,

28:34 I would like to,

28:35 um,

28:36 ask if you could possibly,

28:37 um,

28:39 um,

28:39 uh,

28:40 finalize your comments,

28:41 uh,

28:42 as we have other speakers waiting,

28:44 um,

28:45 so please

28:45 go ahead.

28:46 Thank you.

28:47 Yes,

28:47 the last area I would mention,

28:49 thank you very much.

28:50 The last area I would mention,

28:51 which again is,

28:52 is,

28:52 uh,

28:53 is important,

28:54 is,

28:54 uh,

28:55 the,

28:55 the trade corridors.

28:57 Um,

28:57 we are taking steps

28:59 to make sure that

29:01 the interventions that were made in other parts

29:03 of the continent that led to successful,

29:06 um,

29:07 uh,

29:07 successfully and competitive trade corridors,

29:10 such as the East African Community.

29:12 That we model,

29:14 uh,

29:14 we use that model to expand to the rest of

29:16 the continent to ensure the effectiveness of our trade,

29:19 uh,

29:20 of our trade,

29:21 uh,

29:21 uh,

29:21 corridors.

29:22 So these are the interventions that we have

29:24 made since the establishment of the AFCFTA Secretariat,

29:28 because we recognize

29:29 that an agreement by itself,

29:31 uh,

29:32 with the positive projections that you have made,

29:34 that the agreement by itself is not adequate.

29:37 We have to introduce other tools

29:39 to make sure that,

29:40 um,

29:41 we

29:41 See successful implementation of the AFCFTA.

29:44 So,

29:44 thank you very much for the,

29:46 um,

29:47 the opportunity.

29:48 I slightly ran over time,

29:50 but I think it's a very,

29:51 very important,

29:52 uh,

29:53 to provide you with a comprehensive update

29:55 of where we are

29:57 in the implementation of the AFCFTA.

29:59 Thank you very much.

30:00 Thank you very much,

30:01 Your Excellency.

30:03 Indeed,

30:03 this update was of tremendous use,

30:06 and,

30:07 and actually the challenges you are facing,

30:10 as you mentioned,

30:11 are very similar to other regional

30:15 integration or free trade agreements that are being implemented.

30:19 So

30:20 you are doing extremely well.

30:22 Uh,

30:22 and I also appreciate that you are

30:25 already thinking about the complementary actions,

30:28 because by itself,

30:29 uh,

30:30 the,

30:30 the agreement will not lead necessarily to the impact uh you

30:34 are looking for unless these complementary actions are taken into account.

30:38 So thank you so much for joining us and thank you for this uh great update.

30:44 Uh,

30:44 let me,

30:45 um,

30:46 uh,

30:46 invite our senior economist,

30:48 uh,

30:48 Marilla,

30:49 uh,

30:50 Malisquestra.

30:51 Um,

30:53 who is one of the main authors of the report to present

30:56 the results of our study.

30:58 Thank you,

30:59 Marilla.

30:59 Over to you.

31:01 Thank you so much.

31:02 Good morning.

31:02 Good afternoon,

31:03 everyone.

31:04 Um,

31:04 let me share my screen.

31:06 Um,

31:08 So it's taking a while.

31:14 OK.

31:23 and um

31:30 Um,

31:31 can you see my screen?

31:31 It's all good.

31:33 You have to change the display settings.

31:35 Just click drop down and switch it off.

31:38 The trouble is that it won't let me.

31:41 Oh,

31:46 OK,

31:46 perfect.

31:48 OK.

31:51 So once again,

31:52 thank you for joining us today and um as um I'd like to

31:56 start by saying uh a huge thank you to the AFCFTA Secretariat,

32:01 um,

32:01 who's uh the colleagues from the Secretariat have been extremely um

32:06 uh helpful in providing guidance and continued collaboration on this report.

32:10 So just a big thank you also to the team of researchers,

32:14 colleagues from within and outside the bank who have contributed to this report.

32:18 Um,

32:19 The AFCFTA

32:22 has the ambition of linking 55 countries with 1.3 billion people

32:27 and a combined GDP of $3.4 trillion

32:31 into one single market.

32:32 It provides a tremendous opportunity to stimulate Africa's trade and

32:37 investment and thereby contributing to its industrialization,

32:42 to accelerate economic growth and create new jobs and reduce poverty.

32:46 Um,

32:48 the negotiations are progressing well,

32:50 and there's no one better to tell you about it than the Secretary General,

32:54 so,

32:54 um,

32:55 I will

32:56 not be going into details here just to say that we,

33:00 uh,

33:00 this is exactly what we're looking at in our study at the,

33:03 um,

33:04 thesevi AFCFTA negotiation phases and what they mean in terms of

33:08 the gains in terms of trade and growth and jobs.

33:12 Um,

33:13 so together all these ambitious steps,

33:16 um,

33:16 uh,

33:17 in terms of the liberalization of trading goods and services,

33:20 harmonization of the rules,

33:22 uh,

33:22 in terms of competition,

33:24 investment,

33:24 digital trade,

33:26 um,

33:26 intellectual property rights,

33:28 they have the potential to boost income in Africa by 9%

33:32 and the 150 million people out of extreme poverty by 2035.

33:38 It also has the potential to create 18 million new jobs.

33:43 Uh,

33:43 let me

33:44 explain how this potential could be realized.

33:48 In our report,

33:50 we have explored three possible implementation scenarios.

33:54 First,

33:55 we start with the baseline scenario,

33:57 which is what would have happened and what would be the parcel of growth,

34:01 investment,

34:02 trade,

34:02 uh,

34:02 jobs

34:03 if the AFCFTA did not take place.

34:07 And then we compare our scenarios against this baseline without the AFCFTA.

34:12 And those who are familiar with our 2020

34:15 report will have seen the trade scenario already,

34:18 where we look at the reduction in tariffs,

34:20 we look at the reduction of non-tariff measures in trade in goods and services,

34:25 and the implementation of trade facilitation measures.

34:29 What we do in this report,

34:30 we extend the analysis to include two additional scenarios.

34:34 The FDI broad

34:36 scenario

34:37 builds on the previous scenario by adding the changes in FDI flows

34:42 to account for the boost in FDI coming from the AFCFTA,

34:47 just basically covering the preferential agreement cover all

34:51 countries at the continent.

34:53 So

34:53 there's no longer the spaghetti bowl of regional agreements.

34:56 There's one single FTA.

34:59 Then we look at the FDAD scenario and what we do here,

35:02 we basically look at the expansion of scope and depth of the commitments.

35:07 So we're just also adding all this phase two and phase 3,

35:12 topics,

35:12 harmonization of rules and reduction the resulting reduction of

35:17 trade costs and additional boost to FDI coming from

35:20 the harmonization of those policies.

35:23 So once we have those three scenarios,

35:25 um,

35:26 we look at the implications for,

35:28 for growth and trade and investment,

35:30 poverty reduction,

35:31 jobs,

35:31 and,

35:32 and,

35:32 and so on.

35:34 First,

35:35 let me start by saying what do we think might happen

35:38 to the potential loss of FDI as a result of AFCFTA.

35:43 Um,

35:44 what we,

35:45 uh,

35:45 what our estimates have shown is that the,

35:48 uh,

35:48 the AFCFTA could provide a significant boost to intra-Africa flows

35:54 of foreign direct investment.

35:55 The Intra-Africa FDI could increase between 64 and 68%

36:01 relative to its,

36:02 uh,

36:02 level of in 2017,

36:05 uh,

36:05 depending on the level of ambition of the agreement.

36:08 We also foresee an increase in FDI from outside of the region.

36:13 And what the most ambitious scenario,

36:16 these inflows could actually more than double.

36:21 Foreign investment brings know-how and helps firms

36:24 join the regional and global value chains

36:26 in boosting productivity.

36:29 Deepening trade flows and diversifying to other industries

36:32 could reduce Africa's dependence on volatile commodity exports.

36:37 What we see is that exports between African countries,

36:39 especially manufactured goods,

36:41 could double by 2035,

36:43 and this would generate

36:45 this additional boost to trade investment

36:47 could generate significant income gains.

36:49 We estimate.

36:50 That the

36:52 income gains could reach 571 billion by 2035 at the continental level.

36:58 This would create higher paid,

36:59 better quality jobs,

37:01 especially for women.

37:03 When we look at the results across countries,

37:05 we see that uh all countries see the potential to gain from AFCFTA.

37:11 The biggest,

37:12 the,

37:12 the gains range from

37:14 5 to 15% uh in terms of income boost by 2035.

37:19 Again,

37:19 we're comparing to the scenario,

37:21 uh,

37:22 the baseline scenario with no AFCFTA.

37:25 Uh,

37:25 the biggest income gains are expected in Cote d'Ivoire,

37:29 Zimbabwe,

37:29 and Namibia,

37:30 and an average boost to income of 9% in the continental level,

37:34 um,

37:35 could be expected.

37:37 Now,

37:37 uh,

37:38 just by accounting for the impact of FDI,

37:41 we see an additional gains of 20% on average compared to our 2020 scenario,

37:47 uh,

37:48 2020 report.

37:50 However,

37:50 these are really conservative estimates and should be

37:53 seen as a lower bound of the gains,

37:56 um,

37:56 that come originally from the 2020 report covering the reduction of tariffs,

38:01 non-tariff measures,

38:02 and trade facilitation.

38:04 The most ambitious scenario,

38:06 the FTA

38:07 deep scenario,

38:08 uh,

38:09 increases the gains,

38:10 especially for some smaller countries which are in bad need of FDI

38:14 new investment flows and which are originally facing really high trade costs,

38:19 and such small countries include Burkina Faso,

38:22 Senegal,

38:22 and Namibia.

38:24 Just to give you uh an uh uh a bit of a,

38:28 and a more in-depth uh view of what might happen to,

38:31 to trade flows,

38:33 we see that the,

38:34 um,

38:34 the

38:35 AFCFTA really provides a significant boost to Intra-African flows.

38:40 Uh,

38:40 exports.

38:41 For example,

38:42 the biggest gains would be expected in manufacturing,

38:45 up to 134%,

38:47 uh,

38:48 quite a significant boost trade in services,

38:51 boosting overall exports by over 109%.

38:56 Overall total exports from the continent,

38:58 so just combining into an extra African flows could increase by about 30%.

39:04 If we have the successful implementation of the ambitious

39:08 agreement as compared to the baseline without the agreement.

39:11 So significant gains to be realized there.

39:13 And finally,

39:15 these gains in trade and FDI that

39:18 boost growth have significant implications for poverty

39:21 reduction.

39:23 So what we estimate is that the number of

39:26 poor would have increased in the baseline from 479

39:31 million

39:32 to 317.

39:34 We're talking about extreme poor living at $1 a day,

39:38 $1.90 a day.

39:39 And purchasing power parity terms.

39:42 What we see is that the AFCFTA has the potential to reduce

39:46 the number of extreme poor by the additional 50 million by 2035

39:51 and of course the number increases with the degree of ambition of the agreement.

39:57 Finally,

39:57 just to give you a two very,

39:59 um,

40:00 22 country examples,

40:03 uh,

40:03 we have results for about 30 countries,

40:05 but if you look specifically at each

40:07 country depending on their comparative advantage and,

40:10 and the trade cost reduction,

40:12 the,

40:13 the different sectors are likely to,

40:15 to benefit.

40:15 Of course,

40:16 there are some sectors that could potentially lose wages

40:18 here highlight the top 3 sectors that would,

40:21 could see a boost to employment.

40:23 Um,

40:24 of selected Tunisia because of the delegation of

40:27 the Tunisian minister we'll be speaking to later,

40:30 and we could see the potential of the equipment to generate jobs in textiles,

40:34 in manufacturing,

40:35 in processed food,

40:36 and those have the potential to boost wages by about 1510 to 15%.

40:41 Depending on the intensity of the employment in those sectors,

40:45 uh,

40:46 um,

40:46 and different types of workers are likely to gain,

40:49 uh,

40:49 as a result on average.

40:51 In Tunisia,

40:52 it so happens that because,

40:53 um,

40:54 the,

40:55 um,

40:56 Uh,

40:56 some of the sectors are at risky intensive like manufacturing and processed food.

41:00 Those wages of workers of skilled workers could grow a bit faster than unskilled,

41:04 but everyone gains.

41:06 On the other hand,

41:07 in the case of Rwanda,

41:08 we see a faster growth of female and unskilled workers,

41:11 but again,

41:13 everybody's wages are growing faster

41:15 in case of the agreement.

41:17 Just to wrap up,

41:18 what are the steps to unlock the potential of the AFCFTA,

41:22 and this is really what um

41:24 what um

41:25 Secretary General has already mentioned,

41:28 and,

41:29 you know,

41:29 what needs to happen to translate these opportunities that

41:32 the AFCFTA provides into more export investment and jobs.

41:36 And there's several elements,

41:38 um,

41:39 so.

41:40 It's critical to increase the ownership of

41:42 the private sector in the AFCFTA process.

41:45 Uh,

41:46 it will be,

41:47 will be the enterprises,

41:48 not the governments that will generate this

41:50 trade and investment and economic expansion.

41:54 Further,

41:54 it's critical to pair the AFCFTA with a strong complementary agenda.

41:59 Governments with the support of the regional economy communities and of

42:02 course the AFCFTA Permanent Secretariat

42:05 should engage in multi-stakeholder consultations.

42:08 Um,

42:09 in each country to prepare a robust

42:11 complementary set of actions and policies aiming

42:15 to three concrete objectives.

42:17 This is treaty administration,

42:18 cross-agency implementation,

42:20 and transition to free trade.

42:22 What do we mean by those terms?

42:24 Treaty administration is to really the ability of the trade ministers to,

42:28 to enforce the implementations,

42:31 to monitor,

42:31 to undertake problem solving activities benefiting the private sector

42:36 when trading.

42:37 Cross agency implementation really means establishing some coordination

42:42 protocols and enhance capacity of those agencies,

42:46 uh,

42:46 that have impact on trading goods and services

42:49 such as customs,

42:50 SPS,

42:51 uh,

42:51 regulatory bodies for services sectors.

42:53 And finally,

42:54 the transition to free trade

42:56 means that monitoring the impact on Sectors uh addressing um any

43:01 uh potential uh vulnerabilities and the

43:05 workers that might be potentially displaced,

43:07 setting mechanisms to ensure the smooth transition

43:10 that it's uh that benefits,

43:12 um,

43:12 um,

43:13 um,

43:14 as many sectors as possible,

43:16 uh,

43:16 in this transition to open

43:18 uh continental market

43:20 just to wrap up.

43:22 As the Secretary General keeps saying,

43:24 the time for change is now.

43:26 I'm hoping,

43:27 uh,

43:27 I've convinced you that our team has come up with the

43:31 analysis that really shows significant benefit

43:34 of the implementation of the AFCFTA,

43:37 but of course,

43:37 significant challenges remain,

43:39 and I'm looking forward to hearing from the

43:42 panelists,

43:42 um,

43:43 to discuss the role of the government and the private sector in

43:46 making this agreement a success that it has the potential to be.

43:50 Thank you so much.

43:55 Thank you very much,

43:56 Marilla.

43:56 Uh,

43:57 let us move now to the fire chat,

44:00 and we have with us Doctor Marie Pangestu.

44:04 Uh,

44:04 she's the managing director for Development Policy

44:07 and Partnerships at the World Bank.

44:09 Dr.

44:10 Pangestu has also had a political career serving as Indonesia's Minister of Trade,

44:16 as well as tourism and the Creative Economy Minister

44:20 for 10 years between 2004 and 2014.

44:24 She's an international expert on a range of global.

44:27 Issues and has vast experience

44:30 over 30 years in academia,

44:32 international organizations,

44:34 and government

44:35 working in areas related to international trade,

44:38 investment and development,

44:40 multilateral,

44:41 regional,

44:42 and

44:43 national settings.

44:45 Um,

44:46 we also have,

44:48 uh,

44:48 Mrs.

44:49 Saida Hashisha,

44:51 uh,

44:51 director of Economic and commercial cooperation,

44:53 and Mr.

44:54 Shawki Jabali,

44:55 director of Africa

44:57 from the Ministry

44:58 of Trade

45:00 of Tunisia.

45:02 Attending on behalf of Mr.

45:04 Minister Rabi,

45:05 who could not

45:07 attend

45:08 and had to cancel.

45:12 Unexpectedly,

45:15 so we are,

45:16 let me start

45:17 with you,

45:18 Ibu Mari.

45:20 When you were Trade Minister

45:22 of Indonesia,

45:24 you were responsible for regional trade negotiations,

45:27 including with ASEAN.

45:28 And in fact you served as chairperson of ASEAN in 2011.

45:34 Please tell us about your experience in those roles.

45:37 What steps does a government need to

45:39 take to benefit from greater regional integration?

45:43 Over to you,

45:44 uh,

45:44 Marie.

45:46 Uh,

45:46 thank you,

45:47 uh,

45:47 Mona,

45:48 and good good day to,

45:50 uh,

45:51 everybody,

45:52 uh,

45:52 on this,

45:53 uh,

45:53 call.

45:54 Let me just,

45:55 uh,

45:55 share if I can,

45:57 uh,

45:57 four things,

45:58 uh,

45:58 my own learning,

46:00 uh,

46:00 through my journey with,

46:01 uh,

46:02 both

46:03 doing the analysis as well as trying to implement,

46:06 uh,

46:06 regional integration in the Asian context

46:09 and what,

46:10 uh,

46:10 we can learn from that,

46:11 uh,

46:12 in,

46:12 in today's context as we

46:15 have seen a very strong political commitment

46:19 for the first time,

46:20 uh,

46:20 in,

46:20 you know,

46:20 in the breadth and depth

46:23 of the ACF,

46:25 uh,

46:26 AFCTA.

46:28 Uh,

46:28 did I get that right?

46:29 AF

46:30 AFCFTA,

46:32 I missed the F.

46:34 Um,

46:35 uh,

46:35 I,

46:36 I would really like to just share 4 things.

46:38 Um,

46:38 I think first is

46:40 building the case for the benefits,

46:42 uh,

46:42 of the regional integration,

46:44 which,

46:45 uh,

46:45 I think this report has,

46:46 uh,

46:47 is really going to help,

46:49 uh,

46:49 to,

46:49 uh,

46:50 emphasize the benefits,

46:52 uh,

46:52 from the,

46:53 the regional economic integration,

46:55 whether it's growth,

46:57 uh,

46:57 job creation,

46:58 poverty reduction.

47:00 Uh,

47:01 and inclusiveness,

47:02 and you have to kind of go beyond the,

47:05 the,

47:05 the,

47:06 the big numbers

47:08 to

47:08 finding examples in sectors

47:11 and,

47:12 you know,

47:12 because it's called a trade agreement,

47:14 a lot of,

47:15 there's always a lot of misperception that this is only about trade,

47:18 but a lot of the benefits will come from investment.

47:21 So you have to make sure you,

47:23 you see the nexus between trade

47:25 and investment coming through.

47:27 And

47:29 typically most trade agreements,

47:31 as this one in the first phase is going to look at the cross,

47:35 cross border barriers which is the trade

47:37 non-tariff measures and the trade facilitation,

47:40 and I just wanted to emphasize on,

47:43 on facilitating the movement of goods and people

47:48 is kind of key

47:50 and it is sometimes the easier part.

47:53 Of,

47:53 of,

47:54 uh,

47:54 of a trade agreement

47:56 and it goes beyond just the,

47:59 the,

47:59 the regulations,

48:01 you know,

48:01 like in the case of trade facilitation,

48:04 having a single window,

48:05 for instance,

48:07 in each country and then having the single

48:09 window talk to each other between countries,

48:11 that's one part of it.

48:13 But in the case of Africa,

48:15 what I did learn from my trying to understand.

48:19 Uh,

48:19 what would make it,

48:20 what would

48:21 it take to work in Africa?

48:23 I think the infrastructure connectivity is going to be key

48:27 to,

48:27 to be in parallel,

48:29 uh,

48:29 with the,

48:30 um,

48:31 with the,

48:31 uh,

48:32 you know,

48:32 the agreement on customs and,

48:34 and goods movement and so on.

48:36 So I think

48:37 coupling that with,

48:38 uh,

48:38 with the

48:40 road as well as because we're talking about digital

48:43 telecommunications connectivity,

48:45 I think will be important.

48:46 And the final thing I would say about benefits is

48:50 the way we used to explain,

48:52 especially to the,

48:53 uh,

48:54 to the,

48:55 you know,

48:55 because you have different levels of development.

48:57 You have the same

48:58 case here and you've got

49:00 many,

49:00 many more countries here.

49:01 You've got

49:02 52 countries

49:04 and 43 are already on board.

49:06 The lesser.

49:07 Developed compared to the more developed,

49:09 the lesser developed needs to be the capacity building and the

49:14 kind of you have,

49:15 you are on a slower timeline or you are doing it with capacity building

49:20 is going to be important to provide the arguments

49:23 for these countries to face their

49:26 constituency.

49:28 Second,

49:28 you will always hear this the countries and the

49:32 sectors that feel that they are going to be,

49:35 you know,

49:35 squashed or disappear with regional integration,

49:39 you need to really have a discussion with the private sector,

49:43 with

49:44 all the stakeholders

49:46 to assure them that.

49:48 A

49:50 transition will happen.

49:51 There will be capacity building.

49:54 There will be the time to adjust.

49:56 There will be

49:58 opportunity because the static benefits that you have outlined,

50:02 I would say the benefits that you've outlined in your report

50:05 tend tend to be static,

50:07 and we know with all regional integration

50:09 the dynamic benefits.

50:10 benefits can be larger than what we are seeing now as the kind of static benefits,

50:16 and you can reflect on on other regional integration

50:19 on that.

50:20 And I think I just want to emphasize that for Africa

50:24 this is so timely because of all that's happening

50:27 in the world today,

50:28 the fact that,

50:29 you know,

50:30 apart from COVID trade in the

50:32 importance of trade in recovery and development

50:35 mentioned by the Secretary General Mendez.

50:39 I think you can see that the supply chain disruptions

50:42 and this kind of resilience versus efficiency

50:46 discussion is leading to regional value chains.

50:49 So I think the benefits of,

50:52 you know,

50:53 in a region.

50:55 to have different countries have

50:58 different complementarities that you can build regional value chains,

51:01 I think needs to be

51:03 really emphasized in the case

51:05 of Africa.

51:06 In the case of ASEAN,

51:07 we actually at the time

51:09 looked at intraregional complementarity

51:13 to increase our regional.

51:15 Competitiveness vis a vis the external market as well

51:18 as for our own regional market,

51:20 and I would like to suggest that this is still a valid argument,

51:24 especially in the case of building regional value chains.

51:27 You can take food

51:28 where Africa is mainly

51:31 importing food.

51:32 This would be a really great opportunity to develop that.

51:36 A third point,

51:37 distribution.

51:38 This is the complementary agenda that I think was emphasized in the report.

51:43 You do have to make sure

51:45 that you address the distribution

51:47 potential distribution effects,

51:49 and it will need complementary policies.

51:52 I heard the Secretary Mendez mention.

51:55 Uh,

51:56 there was a protocol on women and youth,

51:59 uh,

52:00 and,

52:00 you know,

52:00 how to make sure that translates into national policies.

52:04 The final thing I would say,

52:05 I would

52:06 add is that

52:07 I think that in your last slide,

52:10 Marilla,

52:10 you had,

52:11 uh,

52:12 you had,

52:13 uh,

52:13 you know,

52:14 engaging

52:15 in multi-stakeholder consultation by government.

52:17 Um,

52:18 and it is about ownership with the private sector.

52:21 It is about the stakeholders.

52:22 I just wanted to mention one learning

52:24 on the government side.

52:26 It is about treaty administration and

52:29 And so on,

52:30 but I tell you,

52:32 the two things that I would share from our own experience with ASEAN,

52:36 I think it's still a continued process,

52:39 is how do you get interagency

52:42 coordination

52:43 that is really key

52:44 for each country to be able to implement this free trade agreement.

52:48 And in the case of ASEAN,

52:50 in the end

52:51 there was an agreement,

52:52 and this,

52:53 I think the Secretariat can reflect on this,

52:55 to actually

52:57 have countries

52:58 create,

53:01 you know,

53:01 it would be called AFCT,

53:06 AFCFTA

53:09 coordination task force

53:12 within each country

53:14 that needs to be headed

53:15 pretty high up in the government.

53:18 And they serve to be the coordination body to implement

53:22 the different parts of the agreement and to,

53:24 you know,

53:24 do their job in terms of following up with,

53:27 with each of these agencies.

53:28 Without that,

53:31 it really is tough to make it work

53:33 and that those bodies are the ones that need to make it happen.

53:37 And those are the bodies that need to be supported by capacity building

53:41 to,

53:42 you know,

53:43 support,

53:44 facilitate

53:47 the different agencies to be able to meet the different,

53:50 um,

53:50 the different components of the treaty,

53:52 and,

53:53 and I think this,

53:54 this is just input for the Secretariat as well as

53:58 how to make it happen at the country level.

54:00 Let me stop there.

54:03 Thank you very much,

54:05 Ibu Mari.

54:06 I think your,

54:07 your practical experience

54:09 is of tremendous,

54:11 tremendous help for,

54:14 for the kind of work that we do.

54:16 We look at the analysis,

54:18 but there is nothing

54:19 better than actually having gone through it.

54:22 I retain several messages from what you mentioned.

54:26 First,

54:26 that the FTA

54:28 is not just about trade.

54:29 It's about investment.

54:31 Uh,

54:32 it is going to have its,

54:33 it's,

54:34 um,

54:35 uh,

54:35 main impact on investment and from there on growth.

54:39 The second is that,

54:41 um.

54:42 In in in the region in ASEAN as well as in Africa,

54:46 we have countries with different levels of development

54:50 and therefore

54:51 the implementation will have to be paced to their level of development

54:55 and the less developed countries may need

54:59 capacity building in that process.

55:02 You also,

55:03 you also mentioned the need to deal with the

55:06 resistance that will come from the private sector.

55:09 It will

55:10 require a change and adjustment as well as new opportunities,

55:14 but there is always fear,

55:17 and we The government will need to address that and meet with the private sector,

55:21 and we have a 2nd session of this

55:24 seminar with the private sector.

55:26 Also,

55:27 the need to

55:29 be very careful about the impact on distribution and impact on the poor.

55:34 And finally,

55:35 because of the complexity of a free trade agreement

55:38 as it touches many sectors and many ministries,

55:42 interagency coordination

55:45 is also important.

55:47 So these are great lessons,

55:49 Ibu Mari,

55:50 and we will dig more into,

55:52 into those.

55:54 Uh,

55:54 let me now turn to,

55:56 um,

55:57 the representatives of the Tunisian ministry.

56:01 Um.

56:03 Madame

56:04 Saida Hashisha and um um

56:07 Monsieur Chaoukijabali,

56:09 uh,

56:09 you may speak in French if you prefer,

56:11 and we will have uh

56:13 um

56:14 simultaneous translation Vuve pardon of Francais vuve pose vare of France

56:19 jevela pose angle e je la repose of Francais,

56:25 uh,

56:25 a Fiona intradiction simultane don't.

56:28 Um,

56:30 So

56:31 what do you see as the biggest challenges facing the ACFTA today?

56:37 The agreement is moving from phase one to phase two of the discussions,

56:41 which will bring its own challenges.

56:44 And on top of that,

56:45 the world is facing another

56:48 food crisis,

56:49 with food prices in Tunisia and elsewhere in the region

56:53 soaring as a result of the war in Ukraine.

56:56 Could that impact the phase two of the negotiations,

57:00 and could the ACFTA be part of the solution

57:03 to the challenges of food security?

57:06 So there is one part of the question about the general

57:09 challenges facing the implementation of the ATFTA as you see it today,

57:14 and the second part

57:15 that focuses perhaps a bit more on the food issue.

57:20 Jespercua rima.

57:22 So over to you.

57:24 Thank you,

57:24 thank you very much.

57:25 Uh,

57:26 I will try to,

57:27 I will try to speak in English,

57:28 but uh you,

57:29 you will uh uh uh tolerate my,

57:32 my,

57:32 some difficulties maybe uh uh I may face when talking in English.

57:36 Uh,

57:36 but first of all,

57:37 uh,

57:38 let me,

57:38 uh,

57:39 uh,

57:39 apologize on behalf of He,

57:41 Her Excellency,

57:42 uh Ms.

57:43 Fadila,

57:43 uh,

57:44 Hamza,

57:45 um,

57:45 the,

57:45 the Minister of Trade,

57:47 which,

57:47 uh,

57:48 uh,

57:50 who

57:52 are not able to join you,

57:54 uh,

57:55 due to an urgent uh commitment with the government.

57:59 Uh,

58:00 so,

58:00 uh,

58:01 uh,

58:02 Sorry,

58:03 so,

58:03 uh,

58:03 I'm,

58:04 uh,

58:04 Shajabali.

58:05 I'm a director of the cooperation with Africa,

58:07 uh,

58:07 in the Ministry of Trade,

58:09 and I,

58:10 uh,

58:10 have been the,

58:11 um,

58:12 uh,

58:13 AFCFTA negotiator,

58:15 and here,

58:15 uh,

58:16 with me,

58:16 uh,

58:16 Mr.

58:18 Said Miss Saed Aisha,

58:19 sorry,

58:19 the Director General of the International Cooperation in the Ministry of Trade.

58:23 So,

58:24 uh,

58:24 uh,

58:25 uh,

58:25 regarding your question,

58:27 Maybe I may classify the main challenges,

58:30 challenges

58:31 facing the AFCFTA into four main categories.

58:35 First of all,

58:36 I,

58:36 uh,

58:37 I would say,

58:38 uh,

58:38 uh,

58:39 there are always some technical challenges with regard to finalizing the

58:44 negotiations,

58:46 uh,

58:47 maybe for the first phase,

58:50 uh,

58:50 as we have,

58:52 uh,

58:52 always,

58:53 um,

58:54 Uh,

58:56 we,

58:56 we,

58:56 we have to finish negotiating the first phase,

58:59 uh,

58:59 with regard to goods,

59:01 services,

59:01 and also rules of origin.

59:03 And as His Excellency,

59:05 the Secretary General said,

59:07 we need to finalize some countries need to uh to,

59:11 to uh

59:12 to uh submit their offers.

59:15 In services,

59:15 goods,

59:16 and

59:17 we need to finalize the rest of the rules of origins.

59:21 The second challenge,

59:22 I think,

59:24 is linked to legal and institutional

59:28 affairs,

59:30 particularly in terms of capacities

59:32 of state parties to implement.

59:36 The agreement at the national level.

59:38 And here we are speaking about

59:40 the institutional uh uh

59:43 uh framework or institutional or internal

59:46 organizations.

59:47 We need to have uh national uh functional national committees,

59:51 and uh also

59:52 there would be a challenge regarding the transposition of the commitment.

59:57 Uh,

59:58 into the,

59:58 uh,

59:58 uh,

59:59 national legislations.

1:00:01 Here also is,

1:00:02 uh,

1:00:03 uh,

1:00:03 it may be a challenge,

1:00:05 uh,

1:00:06 regarding the implementation of the AFCFTA.

1:00:08 The third challenge,

1:00:10 uh,

1:00:10 I think also,

1:00:11 and,

1:00:11 uh,

1:00:12 uh,

1:00:12 it's something important

1:00:13 that have been mentioned,

1:00:15 uh,

1:00:16 is,

1:00:16 uh,

1:00:16 about infrastructure,

1:00:18 uh.

1:00:19 Mainly we talked about air

1:00:22 and maritime transport,

1:00:24 and also uh maybe uh digital infrastructure

1:00:28 to facilitate trade.

1:00:29 The fourth and last um challenge,

1:00:34 uh,

1:00:34 in my opinion is

1:00:36 an economy.

1:00:37 Challenge

1:00:38 and it's related to the mitigated economic impact

1:00:44 if

1:00:45 no measures

1:00:47 to be undertaken

1:00:49 with regard to trade facilitation,

1:00:52 and particularly with regard to non-tariff barriers,

1:00:55 as you know,

1:00:56 we may have

1:00:57 um

1:00:58 Uh,

1:00:59 an ambitious,

1:01:00 uh,

1:01:00 reduction of,

1:01:01 uh,

1:01:02 tariffs.

1:01:03 But

1:01:03 when it comes to,

1:01:05 uh,

1:01:06 trade barriers,

1:01:06 non-tariff barriers,

1:01:08 uh,

1:01:08 maybe the challenge is there.

1:01:10 Uh,

1:01:11 so,

1:01:11 uh,

1:01:12 another economic challenge may be linked to the imbalanced effect,

1:01:16 uh,

1:01:16 uh,

1:01:17 among member states or state parties,

1:01:19 uh,

1:01:20 especially,

1:01:20 um,

1:01:21 with regard

1:01:22 to the,

1:01:23 um,

1:01:23 uh,

1:01:24 to those uh relying heavily on customs revenues.

1:01:28 Uh,

1:01:28 maybe,

1:01:29 uh,

1:01:29 many states in Africa

1:01:32 are heavily relying on,

1:01:33 uh,

1:01:34 customs,

1:01:34 uh,

1:01:35 revenues,

1:01:36 uh,

1:01:36 from imports.

1:01:38 Finally,

1:01:39 maybe if I can say

1:01:41 the level of ambition uh uh agreed uh in terms of liberalization of trade in goods,

1:01:48 maybe on itself,

1:01:50 uh,

1:01:50 uh,

1:01:51 in my opinion,

1:01:51 may be a challenge,

1:01:53 because when we uh

1:01:55 We,

1:01:56 uh,

1:01:56 we see that,

1:01:57 uh,

1:01:57 uh,

1:01:58 trade liberalizations will be fully,

1:02:00 full,

1:02:01 uh,

1:02:02 after 13 years overall.

1:02:04 And we have 3%

1:02:06 of the goods

1:02:07 that will be uh uh excluded from globalization.

1:02:11 So

1:02:12 if you know that,

1:02:13 that

1:02:14 3% of

1:02:16 of goods

1:02:17 may constitute over 90% of the trade of one country.

1:02:21 So uh here we can,

1:02:23 we can say that

1:02:24 even the level of ambition

1:02:26 may be in some sort a challenge.

1:02:30 Hopefully,

1:02:31 finally to finish with that,

1:02:33 maybe that the Secretariat also has

1:02:36 Uh,

1:02:37 with its partners,

1:02:39 uh,

1:02:40 is leading so many activities.

1:02:45 Uh,

1:02:45 the SG already mentioned,

1:02:47 the the um the PPPs,

1:02:49 the facility adjustment,

1:02:50 the African Trade Observatory,

1:02:53 the mechanism for reporting,

1:02:54 monitoring and eliminating non-tariff barriers.

1:02:58 These

1:02:59 are some,

1:03:00 uh some uh um tools.

1:03:02 That may support

1:03:04 or mitigate these challenges.

1:03:07 Uh,

1:03:07 uh,

1:03:08 so,

1:03:09 I think that uh uh uh the AFCFTA is a good opportunity for Africa and for the world.

1:03:15 And,

1:03:15 uh,

1:03:16 these challenges may be uh addressed.

1:03:20 When

1:03:20 all of us at the continental,

1:03:22 national and regional level,

1:03:24 we support each other

1:03:26 with our international partners to achieve these results.

1:03:31 Thank you so much.

1:03:34 Thank you very much.

1:03:35 I don't know,

1:03:36 Madam Hashisha,

1:03:37 if you would like to uh add anything or we will uh just proceed.

1:03:42 Uh,

1:03:43 uh,

1:03:44 good afternoon.

1:03:45 No,

1:03:45 thank you.

1:03:46 You can,

1:03:47 uh,

1:03:48 proceed.

1:03:49 Mercy.

1:03:50 Thank you very much.

1:03:51 So this,

1:03:53 this brings to an end the first panel,

1:03:56 and we will now move to our next panel to discuss the importance of

1:04:01 foreign direct investment or FDI in Africa

1:04:05 and It can help African firms link to regional and global value chains.

1:04:11 The ACFTA can be leveraged to improve the productivity

1:04:14 of domestic firms by linking them to multinationals,

1:04:17 via investment partnerships,

1:04:20 trade,

1:04:21 and countries in Africa with larger markets.

1:04:24 And fewer trade barriers already attract significantly more

1:04:29 FDI from inside and outside the continent,

1:04:32 which offers encouraging signs about the potential

1:04:35 of the ACFTA to boost FDI inflows.

1:04:39 Still,

1:04:41 Africa's level of FDA and global value chain intensity

1:04:45 are low and underdeveloped compared with other parts

1:04:49 of the world because of the fragmented markets,

1:04:51 the FDI

1:04:52 barriers,

1:04:53 and the political and regulatory risks.

1:04:56 I,

1:04:56 I believe that the ACFTA can play

1:05:00 a very crucial role in

1:05:04 reducing the trade barriers for goods and services

1:05:08 and thus boosting Africa's regional

1:05:12 integration and global value chain

1:05:14 participation.

1:05:16 To discuss some of these topics,

1:05:18 we have with us today Mr.

1:05:20 Dave Coffey,

1:05:22 the CEO of the African Association of Automotive Manufacturers.

1:05:27 Mr.

1:05:27 Coffee has extensive experience in the automotive sector.

1:05:31 He has served as president

1:05:33 of the National Association of Automotive Components and Allied Manufacturers.

1:05:39 Um,

1:05:40 and then we have

1:05:41 uh also with us Dr.

1:05:43 Edem

1:05:44 Azogenu,

1:05:45 who's the co-chair of AfroChampions,

1:05:48 a regional,

1:05:50 uh,

1:05:50 public-private partnership promoting impactful regional

1:05:54 investments by African multinationals.

1:05:57 And finally,

1:05:59 last but not least,

1:06:00 we have our IFC Director of Sector Economics,

1:06:04 Mr.

1:06:04 Issa Fay.

1:06:06 ISA directs the development and implementation

1:06:09 of IFC's ex ante impact assessment system

1:06:13 and is responsible for the monitoring,

1:06:15 evaluation,

1:06:16 and reporting

1:06:17 of IFC's investment and

1:06:20 advisory services.

1:06:23 Previously,

1:06:24 ISA was also with the African Development Bank.

1:06:28 Let me start first with Adam.

1:06:31 As a representative of the private sector in Africa.

1:06:35 What do you think can be done to encourage deeper buy-in of the by the private sector,

1:06:42 and how can the World Bank Group

1:06:44 support stakeholders in reaching concrete results?

1:06:52 Um,

1:06:53 Mona,

1:06:54 I think,

1:06:54 uh,

1:06:55 so I would step in for Doctor Ederewenu.

1:06:58 Um,

1:06:58 uh,

1:06:59 unfortunately,

1:06:59 he's unable to join.

1:07:01 Um,

1:07:02 so my name is Richard Edujavi,

1:07:03 the senior advisor at,

1:07:05 um,

1:07:05 for Champions.

1:07:06 So,

1:07:07 uh,

1:07:07 unfortunately,

1:07:07 for some reason in my camera is also not,

1:07:09 uh,

1:07:10 picking up.

1:07:11 So I think that,

1:07:12 uh,

1:07:12 if you can just hear me,

1:07:13 let me know so that,

1:07:14 uh,

1:07:14 I go ahead.

1:07:15 We can hear you.

1:07:16 We can hear you,

1:07:17 Richard.

1:07:17 So please go ahead.

1:07:18 Wonderful.

1:07:19 Thank you.

1:07:19 So thanks,

1:07:20 uh,

1:07:20 you for organizing the,

1:07:22 this panel,

1:07:23 and then,

1:07:23 and then also showing to us all the results of,

1:07:27 of the report which was done.

1:07:28 Um,

1:07:29 in many ways,

1:07:29 I think we are able to connect to it.

1:07:31 Um,

1:07:32 I think that,

1:07:33 uh,

1:07:33 when it comes to how,

1:07:34 uh,

1:07:35 the private sector can be involved in the AFCFTA,

1:07:37 uh,

1:07:38 it's been said or uh

1:07:40 Uh,

1:07:40 Ms.

1:07:41 P used to talked about the fact that,

1:07:43 uh,

1:07:43 or the report also talked about the fact that there should be that,

1:07:46 um,

1:07:46 ownership,

1:07:47 uh,

1:07:47 from the private sector.

1:07:49 You see,

1:07:49 I mean,

1:07:49 when laws are made,

1:07:50 when rules are made for the private sector,

1:07:53 without the private sector sitting at the table to,

1:07:56 to show or to talk about their own problems and challenges which will help shape

1:08:00 the,

1:08:00 the,

1:08:01 the rules or the protocols,

1:08:03 then it becomes difficult in the end to be able to

1:08:06 um

1:08:07 Uh,

1:08:08 make the private sector active.

1:08:10 I think that,

1:08:11 uh,

1:08:11 when the private sector is at the table discussing,

1:08:14 certainly,

1:08:15 it has a,

1:08:16 uh,

1:08:16 a lot of power

1:08:17 to be able to influence

1:08:19 many other or demonstration effect

1:08:21 to influence the private sector,

1:08:23 which is not at the table to be able to join the AFCFT clearly.

1:08:27 Yeah.

1:08:27 So,

1:08:27 and that is,

1:08:28 that is one point which I think,

1:08:29 uh,

1:08:30 would,

1:08:30 that buy-in

1:08:32 will come from having first of first and foremost that ownership

1:08:35 uh from the private sector.

1:08:37 But then again,

1:08:37 that is not all.

1:08:38 I mean,

1:08:39 the,

1:08:39 the,

1:08:40 the private sector,

1:08:41 uh,

1:08:41 should be,

1:08:42 uh,

1:08:43 much more aware of the AFCFTA itself.

1:08:46 And for some reason,

1:08:47 I think that the,

1:08:48 there hasn't been an aggressive marketing,

1:08:51 uh,

1:08:51 uh,

1:08:52 from the private sector itself trying to eliminate.

1:08:59 It may bring.

1:09:00 Uh,

1:09:00 for larger,

1:09:01 uh,

1:09:01 when we talk about the private sector,

1:09:03 if I should disintegrate,

1:09:04 I mean,

1:09:04 there's a large corporations,

1:09:07 uh,

1:09:07 and then the others which is normally lumped into one that is the medium,

1:09:10 uh,

1:09:10 the,

1:09:11 the,

1:09:11 the micro,

1:09:12 small,

1:09:12 medium enterprises.

1:09:13 So let's have this binary for discussion now.

1:09:17 For large corporations,

1:09:18 yeah,

1:09:18 uh,

1:09:19 there's a lot of sensitization going on which they are aware because

1:09:22 they have research departments that normally are able to look at,

1:09:25 uh,

1:09:26 what is happening because they need to extend their market,

1:09:29 look for markets every now and then.

1:09:31 But for small and medium-sized enterprises,

1:09:33 this is an issue.

1:09:34 Um,

1:09:34 I,

1:09:35 I can,

1:09:36 uh,

1:09:36 in confidence,

1:09:37 uh,

1:09:37 or

1:09:39 tell,

1:09:39 tell you particularly that,

1:09:41 uh,

1:09:41 if I talk to my own friends who are business people,

1:09:44 small business people,

1:09:45 uh,

1:09:46 they tend to ask,

1:09:46 what is,

1:09:47 what is,

1:09:47 what is this AFCFT really about?

1:09:50 Uh,

1:09:51 so some of us,

1:09:51 uh,

1:09:52 whilst we engage,

1:09:53 we try to

1:09:54 make the

1:09:55 Uh,

1:09:56 the AFCFTA,

1:09:57 uh,

1:09:57 more,

1:09:58 bring it to the doorsteps of the small and medium size.

1:10:01 I mean,

1:10:01 the,

1:10:02 the simple charcoal or the simple banana seller has no idea.

1:10:06 Uh,

1:10:07 they think that it's just too high in the air for them.

1:10:10 Uh,

1:10:10 if you talk about it,

1:10:11 unless it has been simplified,

1:10:12 it's very difficult.

1:10:14 So that part is there.

1:10:15 So that aggressive marketing

1:10:17 is really needed

1:10:18 to get the buy-in of the private sector on this,

1:10:20 on this as well.

1:10:21 Yeah.

1:10:22 Um,

1:10:22 but then if I should see how the World Bank will come in,

1:10:25 uh,

1:10:27 may

1:10:27 come in from the issue or from the part of the challenges which the,

1:10:31 uh,

1:10:31 the private sector faces.

1:10:33 And here,

1:10:33 I'm talking about mostly about the small and medium-sized enterprises.

1:10:37 In many ways,

1:10:38 trade finance is very difficult for,

1:10:40 uh,

1:10:40 to assess

1:10:41 by the,

1:10:42 um,

1:10:43 SMEs.

1:10:44 Simply because they do not have the collateral

1:10:46 and the banks are actually looking for collaterals.

1:10:48 Uh,

1:10:49 in many cases,

1:10:49 they have the cash flow,

1:10:50 which in my understanding could have been enough,

1:10:53 uh,

1:10:54 to be able to,

1:10:54 uh,

1:10:55 hold

1:10:56 to assess finance in order that they can trade,

1:10:59 but that is not what banks are expecting.

1:11:01 And so I think that here,

1:11:02 maybe the,

1:11:03 the World Bank can clearly come in

1:11:05 in a way that,

1:11:07 uh,

1:11:08 funds may be

1:11:09 readily available,

1:11:11 not.

1:11:11 The banks,

1:11:12 but directly to the SMMEs

1:11:14 because I think that is maybe where uh uh

1:11:17 uh some of the issues are.

1:11:18 Because when it gets to

1:11:20 When,

1:11:20 when funds go through the banks,

1:11:21 they may apply their own

1:11:23 rules again,

1:11:23 and then it will be at the detriment of the

1:11:25 SMEs.

1:11:26 But when funds are able to get to SMEs with,

1:11:29 with measures to,

1:11:30 uh,

1:11:31 I'm,

1:11:32 I'm just rounding up,

1:11:33 yeah,

1:11:33 with measures to,

1:11:34 uh,

1:11:35 to,

1:11:35 to guarantee,

1:11:36 uh,

1:11:36 I'm sure,

1:11:37 uh,

1:11:37 in this way there,

1:11:38 there will be,

1:11:39 uh,

1:11:39 possibility for SMEs to excel under the AFCFTA.

1:11:43 Thank you,

1:11:43 Mona.

1:11:43 Thank you very much,

1:11:44 Richard.

1:11:45 Uh,

1:11:45 your connection just got a little bit,

1:11:47 uh.

1:11:48 Uh,

1:11:48 messy at the end,

1:11:49 but we hear,

1:11:50 we heard,

1:11:51 uh,

1:11:52 pretty much everything.

1:11:52 Thank you.

1:11:54 Uh,

1:11:54 Dave,

1:11:54 your sector,

1:11:55 the automotive industry,

1:11:57 has been one of the most active in trying to

1:11:59 leverage the expanded market that the ACFTA will bring.

1:12:03 Can you give us

1:12:04 an update on what the AAAM is doing

1:12:07 to expand the automotive industry in the continent?

1:12:12 Thank you,

1:12:12 thank you for the opportunity to participate and good day.

1:12:15 Uh,

1:12:16 we are a private sector association where our members are OEMs,

1:12:19 global component makers and service providers that add value to the sector.

1:12:24 We,

1:12:24 we are actively working with African governments,

1:12:27 uh,

1:12:28 to

1:12:29 advise on or to develop,

1:12:31 uh,

1:12:32 and to implement automotive policies and ecosystems that attract

1:12:36 investment from the OEMs and the component makers.

1:12:39 Our,

1:12:39 our industry requires scale because it's globally

1:12:42 competitive and the AFCFTA brings that to,

1:12:45 to the table.

1:12:47 Uh,

1:12:47 so,

1:12:47 so it's at the heart of all our policy development,

1:12:50 which I'll just touch on.

1:12:51 And,

1:12:52 and not every country can assemble a vehicle.

1:12:54 And it's good to see that dynamic changing,

1:12:57 uh,

1:12:57 where people,

1:12:58 where countries are actually saying,

1:12:59 so let's define our niche in the value chain,

1:13:02 which is critical.

1:13:04 Uh,

1:13:04 so we see hub assemblers developing in the four quadrants of Africa,

1:13:08 supported by neighboring countries developing their

1:13:11 value chains and supplying to,

1:13:12 to the hubs.

1:13:14 Uh,

1:13:14 so our first key focus is on policy development.

1:13:17 Our policy team,

1:13:18 uh,

1:13:19 worked with the Ghanaian government and developed the Ghana auto policy which was

1:13:23 approved in,

1:13:24 in March 2020.

1:13:26 There are 3 assemblers,

1:13:28 uh,

1:13:28 doing light assembly at the moment,

1:13:30 semi-knockdown,

1:13:31 there will be another 4 by the end of the year.

1:13:33 So it's really moving positively.

1:13:35 We met the government of Egypt in September last year,

1:13:38 the prime minister,

1:13:39 and in two weeks ago,

1:13:42 they actually approved an auto policy which changed

1:13:44 the architecture of its administrative structure significantly.

1:13:49 So they moved very quickly.

1:13:50 The Ivory Coast advised me.

1:13:53 This week that our policy team

1:13:55 uh

1:13:56 will be commissioned to do,

1:13:57 to develop,

1:13:58 to research and develop their assembly and component policy.

1:14:02 So there's quite a lot of activity and momentum picking up now,

1:14:05 uh on the on the continent.

1:14:07 We've also worked closely with Kenya in supporting their,

1:14:11 their policy rollout and we've provided Ethiopia with a draft policy.

1:14:15 It's very clear that when a policy,

1:14:18 a progressive policy is,

1:14:19 is,

1:14:19 is approved into law,

1:14:21 uh,

1:14:21 the investment follows.

1:14:23 You just look at South Africa,

1:14:24 Morocco,

1:14:25 and,

1:14:26 uh,

1:14:26 and,

1:14:26 and,

1:14:27 and soon to be Egypt and Ghana.

1:14:29 Ghana,

1:14:30 the investment is,

1:14:30 is,

1:14:31 is,

1:14:31 is following based on actual policy uh approval.

1:14:35 So the policies we promote are those that are

1:14:39 are compatible

1:14:40 and facilitate production and trade.

1:14:43 It's important that one does not focus on import substitution.

1:14:47 One needs to trade.

1:14:48 You've got to open up export and import and that's critical.

1:14:52 The vehicle manufacturing,

1:14:54 the vehicle manufacturing CEOs

1:14:57 uh on our membership,

1:14:59 uh,

1:14:59 they,

1:15:00 they have a clear vision.

1:15:01 A model will be produced in one country on

1:15:03 the continent and then traded across the continent.

1:15:06 Trade out and trade back,

1:15:08 uh,

1:15:08 back in.

1:15:10 Our second focus

1:15:11 is on value chain development.

1:15:14 Uh,

1:15:14 we have visited,

1:15:15 uh,

1:15:16 Ghana,

1:15:17 Kenya,

1:15:17 Egypt.

1:15:18 We understand the manufacturing capability in these countries.

1:15:21 We'll visit Tunisia and Morocco in August and,

1:15:24 and,

1:15:24 and July and August.

1:15:25 We understand South Africa well.

1:15:27 What's important is we want to see component manufacturers

1:15:31 that manufacture for the OEMs today extend into Africa.

1:15:35 Go and partner with organizations in,

1:15:37 in African countries,

1:15:39 uh,

1:15:39 and bring in the technology,

1:15:40 bring them the capability.

1:15:42 And they might,

1:15:43 they might not be auto component manufacturers today in East Africa.

1:15:46 African countries,

1:15:47 they might be allied industries in oil or gas or mining.

1:15:50 That's OK.

1:15:51 Partner them

1:15:52 and,

1:15:52 and,

1:15:53 and,

1:15:53 and grow that capability.

1:15:54 Uh,

1:15:55 we've taken 5 component study tours into Ghana.

1:15:59 Focus Ghana because the policy is

1:16:01 as was recently approved uh in in March 2020.

1:16:06 And,

1:16:06 and the,

1:16:07 the countries we took component makers from was South Africa,

1:16:10 Egypt,

1:16:10 and Germany.

1:16:11 We want to see coming from these other countries I mentioned like Tunisia,

1:16:14 like Morocco.

1:16:15 Take them into Africa.

1:16:17 Finding partners.

1:16:18 Let's grow.

1:16:19 We're also working with

1:16:22 with other African countries that want to uh explore value

1:16:24 chain opportunities that want to get into the value chain.

1:16:27 Some of them are in,

1:16:28 some of them are not in.

1:16:29 For example,

1:16:30 we've been to Rwanda,

1:16:31 Lesotho,

1:16:32 Gabon,

1:16:33 Namibia,

1:16:33 Botswana.

1:16:34 Countries are coming forward and saying we want to participate.

1:16:38 So we'll go and visit and see how they can actually uh participate in the value chain.

1:16:44 It's very important and I'll,

1:16:45 I'll end off shortly.

1:16:46 It's important to share

1:16:49 that in partnership and under the guidance

1:16:51 of the African Continental Free Trade Area Secretariat

1:16:54 and in partnership with Rexim Bank and the AU and ourselves,

1:16:58 we,

1:16:58 we,

1:16:58 we are developing a continental automotive strategy.

1:17:02 It will be shared

1:17:03 with the uh senior trade officials and council

1:17:06 of ministers in July for member state input.

1:17:08 This collaboration is very strong.

1:17:11 And uh and important for the development of the industry.

1:17:14 And it's wonderful to see more countries approaching us,

1:17:17 what we call the coalition of the willing.

1:17:19 The private sector is interested in Africa is growing and

1:17:22 we see it in our membership and across Africa.

1:17:25 And uh

1:17:26 as,

1:17:26 as a previous presenter said,

1:17:28 I think a number of presenters said,

1:17:30 the time for Africa is now.

1:17:31 Thank you.

1:17:35 Thank you very much,

1:17:36 Dave.

1:17:37 It's always nice to hear from the private sector,

1:17:40 the,

1:17:40 you know,

1:17:41 you're the doors on the ground and,

1:17:42 and you are the ones who

1:17:45 will drive change.

1:17:46 Um,

1:17:47 so,

1:17:47 Issa,

1:17:48 uh,

1:17:49 you have had many years of experience working directly on development in Africa.

1:17:54 In your view,

1:17:54 what do you see as the development impact of the ACFTA

1:17:58 through private sector investment?

1:18:00 Thank you,

1:18:01 Issa.

1:18:05 You are muted,

1:18:06 Issa.

1:18:11 Can you hear me now?

1:18:12 Yes.

1:18:14 Thank you,

1:18:14 Mona,

1:18:14 for having me and thank you,

1:18:16 colleagues.

1:18:16 I,

1:18:16 I enjoyed your discussion so far.

1:18:19 And now maybe bringing just the perspective of impact,

1:18:22 impact assessment,

1:18:23 and then how

1:18:24 the African continent free trade uh area could,

1:18:28 could generate impact.

1:18:29 I think that

1:18:30 there is a tremendous potential to,

1:18:32 to generate substantive impact.

1:18:34 And then

1:18:34 the way you would look at that an ex ante,

1:18:37 like,

1:18:38 uh,

1:18:38 as we speak,

1:18:39 we could say,

1:18:40 That the

1:18:40 theory of change that I can see here coming out

1:18:43 is that by establishing the African continental Free Trade Area

1:18:47 and supported by the right type of institutions and policies and infrastructure,

1:18:52 uh,

1:18:52 the continent will be able to attract more FDI and then trade more and better.

1:18:57 And this would generate

1:18:59 jobs,

1:18:59 increase incomes,

1:19:00 uh,

1:19:00 diversify the exports,

1:19:02 and then,

1:19:02 uh,

1:19:03 maybe also help,

1:19:04 uh,

1:19:04 reducing the carbon footprint and then generate markets.

1:19:08 So,

1:19:08 I think that there are two

1:19:09 types of,

1:19:10 I mean,

1:19:10 I would assess this kind of

1:19:12 impact ex ante by looking at,

1:19:14 uh,

1:19:14 two dimensions,

1:19:15 the stakeholder kind of effect,

1:19:17 which is,

1:19:18 which,

1:19:19 uh,

1:19:19 constitutes of,

1:19:20 uh,

1:19:21 uh,

1:19:21 effects that are direct or indirect and accruing to the stakeholders.

1:19:26 And then also the systemic,

1:19:28 uh,

1:19:28 type of impact that would come from this type of work.

1:19:31 If you look at the stakeholder mapping and,

1:19:33 uh,

1:19:33 effect,

1:19:34 you would definitely look at,

1:19:35 uh,

1:19:36 effect going,

1:19:36 uh,

1:19:37 to consumers and households,

1:19:39 some going to employees or firms,

1:19:41 and then also,

1:19:42 uh,

1:19:42 some kind of economy-wide type of vehicle like value add,

1:19:45 uh,

1:19:46 uh,

1:19:46 GDP kind of,

1:19:47 uh,

1:19:48 indicators and looking also at,

1:19:50 at climate change and,

1:19:51 and environmental effect.

1:19:52 But in terms of consumers and households,

1:19:54 they are key,

1:19:56 key beneficiaries of the African Continental Free Trade Agreement,

1:20:00 and I think that they would benefit from affordable access to goods and services

1:20:04 because of the connectivity and more integration.

1:20:07 There will be increased access to the services.

1:20:10 Another indicator that we look at,

1:20:11 for example,

1:20:12 the assessment is

1:20:13 better jobs and

1:20:15 wages for employees because

1:20:17 by attracting more FDIs to some of the sectors that are more,

1:20:22 I mean,

1:20:22 Uh,

1:20:23 that requires more skillful labor,

1:20:25 there will be more quality of jobs.

1:20:26 So,

1:20:27 uh,

1:20:27 job,

1:20:27 uh,

1:20:28 quality is going to be

1:20:29 one indicator that will be,

1:20:31 uh,

1:20:31 I mean,

1:20:32 looked at and then including the,

1:20:34 the wages,

1:20:34 uh,

1:20:35 the increase in wages.

1:20:36 And there is some,

1:20:37 um,

1:20:37 some studies that show that the welfare gain of,

1:20:40 can be up to 2.1% for the continent,

1:20:43 uh,

1:20:43 and then,

1:20:44 Uh,

1:20:44 some other,

1:20:45 this was,

1:20:46 uh,

1:20:46 a study from the IMFA if I'm not mistaken.

1:20:48 And there are other studies showing that,

1:20:50 uh,

1:20:51 there are going to be some gains up to 5%,

1:20:53 uh,

1:20:54 in,

1:20:54 uh,

1:20:54 when the,

1:20:55 uh,

1:20:55 with the reduction of trade barriers.

1:20:58 So,

1:20:59 they,

1:20:59 we can also look at some gender dimension into that,

1:21:01 that,

1:21:02 uh,

1:21:02 the wafer gain,

1:21:03 which,

1:21:04 uh,

1:21:04 uh,

1:21:05 point to women who are gaining 10.5%,

1:21:09 uh,

1:21:09 compared to men that will be earning just 9.9%. So,

1:21:12 there is going to be

1:21:13 this type of effect.

1:21:14 That will come,

1:21:15 which is very impactful.

1:21:16 And then economy-wide,

1:21:17 as I say,

1:21:18 you're going to see some GDP increase and GDP growth,

1:21:21 uh,

1:21:22 from 0.66 to 0.997,

1:21:26 for example,

1:21:27 and then accompanied by,

1:21:28 by employment and job creation.

1:21:30 And then we expect also the manufacturing some increase in manufacturing of goods

1:21:36 which will increase by 62% and then intra-African trade

1:21:40 which has been very low now.

1:21:42 What we would expect with this free trade area that can

1:21:46 Increased by 110%.

1:21:48 So a lot of impact coming.

1:21:50 And then in terms of climate,

1:21:52 and this is something that we need to think,

1:21:54 uh,

1:21:54 um,

1:21:56 going forward and that this kind of free trade area

1:21:59 can provide a significant scope for Africa to build resilience,

1:22:02 climate resilient,

1:22:03 and lower the carbon,

1:22:05 uh,

1:22:05 footprint on the continent

1:22:07 by,

1:22:07 uh,

1:22:08 attracting

1:22:09 investment into the renewable energy sector.

1:22:11 And we expect that.

1:22:13 Uh,

1:22:14 the renewable energy capacity can grow

1:22:16 to reach,

1:22:17 uh,

1:22:17 310 gigawatts by 2020.

1:22:21 So these are kind of the type of,

1:22:23 uh,

1:22:24 direct,

1:22:24 indirect effect that I could see.

1:22:26 And now in terms of the systemic effect,

1:22:28 I think that there are

1:22:29 4 attributes of market

1:22:31 creation that I would like to,

1:22:33 to explore when looking at the free trade area.

1:22:36 One is the integration,

1:22:37 as,

1:22:37 uh,

1:22:38 the previous colleagues has said,

1:22:39 there's going to be

1:22:41 really great in terms of,

1:22:42 uh,

1:22:43 uh,

1:22:43 market integration,

1:22:44 connectivity.

1:22:45 It will facilitate the development of national,

1:22:47 regional,

1:22:48 and continental,

1:22:49 continental value chains.

1:22:50 This is,

1:22:51 this is tremendous

1:22:52 in terms of,

1:22:53 uh,

1:22:53 generating markets that are more integrated.

1:22:56 And then some study of the bank are estimating that,

1:22:58 uh,

1:22:59 a 10% increase in the global value chain would,

1:23:03 could help boost per capita income,

1:23:06 uh,

1:23:06 by more than 10%.

1:23:07 So this is really,

1:23:08 uh,

1:23:09 huge in terms of effect.

1:23:11 And by,

1:23:12 by,

1:23:12 by 2035,

1:23:14 the volume of total exports that can be generated from

1:23:17 this connection to the global value chain can,

1:23:19 uh,

1:23:20 increase by 29%.

1:23:22 So,

1:23:22 pretty,

1:23:22 pretty substantial.

1:23:24 Another market attribute that I think would come

1:23:27 from this,

1:23:28 uh,

1:23:28 uh,

1:23:29 free trade area is competitiveness

1:23:31 because by improving the policies that promote competition,

1:23:34 innovation,

1:23:35 and by lifting the barriers to trade,

1:23:38 including,

1:23:38 uh,

1:23:39 putting in place.

1:23:40 Putting in place sound legal and regulatory framework,

1:23:43 infrastructure development,

1:23:45 and so on.

1:23:46 We believe that the,

1:23:47 the African continent,

1:23:48 uh,

1:23:49 uh,

1:23:49 continental Free Trade Area

1:23:51 can

1:23:52 help reduce transaction costs and thereby facilitating investment,

1:23:56 pouring in.

1:23:57 And then there will be some kind of pressure,

1:24:00 uh,

1:24:00 competition,

1:24:01 uh,

1:24:01 and then the incumbent will have to

1:24:04 keep their tools and then innovate to deliver

1:24:06 better products and services in an affordable manner.

1:24:09 And then the,

1:24:09 the e-commerce sector and the digitization that we're

1:24:12 seeing in Africa is a case in point.

1:24:15 Right.

1:24:15 Another,

1:24:16 another attribute that is,

1:24:17 uh,

1:24:18 coming out clearly is the sustainability one.

1:24:21 The African,

1:24:22 uh,

1:24:23 continental Free Trade Area could contribute into creating

1:24:25 a market around circular economy in Africa.

1:24:28 And then,

1:24:29 uh,

1:24:29 some studies done by the African Circular Economy

1:24:32 Alliances and the World Economic Forum are showing that

1:24:35 the continent's circular food system

1:24:37 alone can help a $1 trillion

1:24:40 market to grow by 2030.

1:24:42 So there's really,

1:24:43 really,

1:24:44 uh,

1:24:44 important gains there and including also millions

1:24:47 of inclusive green jobs to be created.

1:24:50 And last but not least,

1:24:51 the inclusive dimension that,

1:24:53 that comes with the integration

1:24:55 because with the FBI,

1:24:57 with trade,

1:24:58 I think that there's a potential to lift 3 million people out of poverty,

1:25:02 and then make sure that their household and corporate,

1:25:04 um,

1:25:05 uh,

1:25:05 firms are also,

1:25:06 uh,

1:25:07 uh,

1:25:07 um,

1:25:08 get some gains into that,

1:25:09 into the process.

1:25:10 And we estimate that.

1:25:12 By 2030,

1:25:13 the fully integrated market of 1.7 billion can generate,

1:25:17 uh,

1:25:18 6.7 trillion of,

1:25:20 of spending by consumers and businesses.

1:25:22 So,

1:25:23 um,

1:25:23 uh,

1:25:24 Mona,

1:25:24 in a nutshell,

1:25:25 a lot of impact can,

1:25:26 can accrue from,

1:25:28 uh,

1:25:28 to

1:25:29 beneficiaries and then

1:25:30 in a systemic way to develop,

1:25:32 uh,

1:25:33 substantive markets.

1:25:36 Thank you very much,

1:25:37 Issa,

1:25:38 for this,

1:25:38 uh,

1:25:39 great,

1:25:40 great feedback.

1:25:41 I think uh it's really important for the private sector

1:25:44 to understand uh the benefits

1:25:47 um

1:25:48 that,

1:25:48 that this ACFTA can bring,

1:25:50 and you have,

1:25:51 you have laid out

1:25:52 all the issues very,

1:25:53 very well.

1:25:54 Um,

1:25:55 we have,

1:25:56 uh,

1:25:56 with us,

1:25:57 uh,

1:25:57 Doctor,

1:25:58 uh,

1:25:59 Ade

1:26:00 Azogeno,

1:26:01 uh,

1:26:01 the co-chair of AfroChampions who,

1:26:03 who was able to join.

1:26:06 Uh,

1:26:06 and if that's OK,

1:26:08 uh,

1:26:08 Doctor Adam,

1:26:09 I'd like to ask you one last question.

1:26:12 Um,

1:26:14 So

1:26:15 we have been talking about the role of the private sector in

1:26:19 taking advantage of the ACFTA

1:26:23 and what will it take for that,

1:26:24 but

1:26:25 we are also concerned about small firms.

1:26:28 What are the primary concerns that small and medium enterprises

1:26:33 have raised in relation to the ACFTA and how can they be addressed?

1:26:40 I,

1:26:40 I,

1:26:40 I think that,

1:26:41 it's,

1:26:41 it's a brilliant question.

1:26:42 However,

1:26:42 the,

1:26:44 I have to,

1:26:44 I would like to address it by stating the context,

1:26:46 right?

1:26:47 That in our attempts

1:26:49 to drive integration on the continent,

1:26:52 two realities exist and we've been doing this for a while with uh

1:26:55 the the regional economic markets.

1:26:57 That the big companies that have,

1:26:59 uh,

1:27:00 who are,

1:27:00 who are the drivers of integration,

1:27:03 uh,

1:27:03 uh,

1:27:04 do not have the

1:27:06 capacity or the resources to invest in the public infrastructure.

1:27:09 Uh,

1:27:10 like roads,

1:27:10 sports,

1:27:10 and rails that will make it easy,

1:27:12 uh,

1:27:13 for,

1:27:13 for the interconnection that we need the infrastructure,

1:27:16 uh,

1:27:17 for integration to happen.

1:27:19 Then when it comes to the SMEs,

1:27:21 the challenge we face is that the SMEs are currently,

1:27:24 who are supposed to be the beneficiaries of integration.

1:27:27 Uh,

1:27:28 of,

1:27:28 of this common market

1:27:29 are focused on their domestic market.

1:27:32 So an SME in

1:27:33 Uganda does not wake up thinking about producing for Senegal market

1:27:37 or for

1:27:37 Cape Verde market.

1:27:39 So,

1:27:39 integration for us has to be a product that needs to be marketed.

1:27:43 And that marketing has to bring into focus

1:27:46 because by the sheer nature of the diversification,

1:27:49 the fragmentation of the continent,

1:27:51 it's important to bring some strategic stakeholders

1:27:54 together.

1:27:55 So,

1:27:55 what are the challenges?

1:27:56 The challenges are logistics,

1:27:57 of course.

1:27:57 The challenges are marketing,

1:27:59 the challenges are regulatory.

1:28:00 We know all of that.

1:28:01 But how do we surmount that?

1:28:03 So I,

1:28:03 I,

1:28:03 I like to look at it more from

1:28:05 what can we begin to do practically because there's a lot happening in fragments.

1:28:10 How do we bring them together

1:28:12 to scale?

1:28:13 And

1:28:14 the theory of change for us at AfroChampions

1:28:16 with what we are doing with uh,

1:28:18 what we are calling the AFCFTA hub

1:28:20 is bringing,

1:28:20 for example,

1:28:21 logistics operators onto a common platform,

1:28:24 bringing,

1:28:25 uh,

1:28:26 because a market asset enablers like your malls,

1:28:29 you have a lot of malls in Africa,

1:28:30 for example.

1:28:31 Uh,

1:28:32 who are,

1:28:32 who,

1:28:32 who,

1:28:32 who can take products of SMEs in one market and take it to multiple markets.

1:28:36 But we have to bring the regulators,

1:28:37 the food and drug authorities,

1:28:39 we have to bring the customs

1:28:40 operators as well.

1:28:42 And then we also have to market.

1:28:44 Branding is a very important thing.

1:28:46 So,

1:28:46 brand equity is also another area we're very keen on

1:28:49 by bringing digital artists and music artists together.

1:28:52 To begin to support SMEs to package products and

1:28:55 brand products in a way that speaks to Africans.

1:28:58 But not only Africans,

1:28:59 speaks to the soul of Africans,

1:29:00 but connects to the markets they want to sell it.

1:29:03 Uh,

1:29:03 and putting all of this on a digital platform that enables people to connect.

1:29:07 will be for us the quickest way

1:29:10 in being able to drive

1:29:11 integration through trade

1:29:13 whilst waiting for Port rail and other things to come on.

1:29:15 So,

1:29:15 I guess my answer to your question is that

1:29:17 there are challenges for sure.

1:29:19 But there are also solutions,

1:29:21 and what we should be looking at is looking at

1:29:23 the low hanging fruit solutions

1:29:26 that exist in pockets,

1:29:27 bring them together into an ecosystem.

1:29:29 And when people begin to see that integration

1:29:33 actually has results,

1:29:34 as profits,

1:29:35 because the private sector is only interested in profit,

1:29:37 you can see that it's growing their money.

1:29:40 They themselves will start marketing it and it will go viral.

1:29:42 So that's my response to your question.

1:29:45 Thank you.

1:29:47 Thank you very much,

1:29:48 uh,

1:29:48 Doctor Ede.

1:29:50 And with that,

1:29:50 I would like to conclude this,

1:29:53 um,

1:29:53 this seminar and thank everybody for,

1:29:56 for joining and sharing their views and,

1:29:59 uh,

1:29:59 to thank Marilla for her,

1:30:01 uh,

1:30:02 work,

1:30:02 uh,

1:30:02 and her presentation,

1:30:04 which was the starting point of the seminar.

1:30:07 I want to say that,

1:30:08 um,

1:30:10 There,

1:30:11 there will be,

1:30:11 there will be very few opportunities like the ACFTA

1:30:15 to really,

1:30:16 to really open the door

1:30:18 for investments in Africa,

1:30:20 and it can remain

1:30:25 a trade agreement

1:30:26 with not much happening,

1:30:28 and we have seen that in many parts of the world.

1:30:31 But as I hear from the private sector,

1:30:34 the eagerness to actually

1:30:36 take advantage of it and create opportunities and make this happen.

1:30:40 I'm very hopeful that the ACFTA

1:30:44 will actually lead to results,

1:30:46 and it will lead to results in terms of trade,

1:30:48 in terms of investment,

1:30:51 that,

1:30:52 and in terms of growth and employment generation

1:30:56 that will be

1:30:57 as inclusive as possible.

1:30:59 And I would like to also urge the private sector

1:31:04 to talk to the government and to talk to us

1:31:07 to let us know

1:31:08 what will it take for you to make this happen.

1:31:12 You are the ones on the ground

1:31:14 investing and facing all the challenges,

1:31:17 and

1:31:18 if we need to prioritize

1:31:20 certain

1:31:21 Uh,

1:31:22 rules and regulations and reforms or activities,

1:31:26 uh,

1:31:27 as,

1:31:27 as Mari Pangestu has said,

1:31:29 this,

1:31:29 this dialogue between the public sector and the private sector will,

1:31:33 will be critical.

1:31:35 So with that,

1:31:36 uh,

1:31:37 thank you all.

1:31:37 I learned a lot,

1:31:39 uh,

1:31:39 and I really appreciate you coming and taking the time to share

1:31:43 your views and your analysis.

1:31:45 Thank you very much.

1:31:47 Goodbye.

1:31:48 Thank you.

1:31:53 Thank you so much.

1:31:55 Thank you.

showAllTimestamps
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transcript
Um, His Excellency will join very soon, please. Thank you. Hello, can you hear me, please? Yes, we can, we can hear you, Samuel. We heard that. Thank you very much. Yeah, thanks for the confirmation. I and Jason, we need to wait for Mona before we go live. So just, just so you know. Understood. No, no worries, it's already running. Um, attendees are joining, so whenever you're ready to start. OK. I know Mona Mona is here. Um, Mona, just a quick note that we have uh simultaneous translation, so you can mention that to the participants. If they feel more comfortable, they can click an icon with the globe, and that's where they will be taken to listen to the French version of the event. Can you say that again, Marilla? Sorry, Amana, I was just saying that we have secured the simultaneous translation um to French, so you can mention to the participants that if they want to be, um, they, they would prefer to listen to the event in French, that they need to click an icon with the globe at the bottom of the screen, and they can listen in French instead. Thank you. So can we start? Yep. OK. All right. So, good afternoon, everyone. And uh good afternoon, um, Your Excellency, Honorable Secretary General Mene, um, our World Bank Managing Director, Doctor Marri Pangestu. Uh, representatives of the trade ministry, um, uh, from Tunisia. Um, Mr. Habisha and Jabali. Uh, very warm welcome to our panelists, uh, Edem Azogenu of AfroChampions. Uh, Mr. Dave Coffey of the African Association of Automotive Manufacturers, and the IFC Director for Sector Economics, Mr. Issafai. And warm welcome to all of you for joining us today. Uh, the ACFTA, uh, is an extremely important initiative. It can have transformative, uh, impacts, uh, for the, for the development of Africa. And we are very, very happy to have, uh, this, um, seminar with you to show you, uh, some of the results of our, uh, work on, on the ACFTA. My name is Mona Haddad, uh, and I'm the global director for trade, investment and competitiveness at the World Bank. This study that I was mentioning has been done in collaboration with the ACFTA Secretariat and has greatly benefited from the guidance of His Excellency, Secretary General, Mr. Wamkele Mene. We very much appreciate that you are here. Thank you very much, Your Excellency. In addition to our numerous trade-related operations currently ongoing at the country level across Africa, the World Bank Group has been engaging with the ACFTA Secretariat and the Regional Economic Communities in their efforts to reduce barriers to economic integration in Africa. Uh, let's start with a welcome from the World Bank director for Regional integration in Africa, uh, Ms. Buthaina Germazi, who could not be with us today, but will be making a pre-recorded welcome. So over to you for um For the recording, please. Good afternoon everyone. It is my pleasure to welcome you all to the launch of a pivotal report. The report has been produced by a partnership between the AFCFTA Secretariat and the World Bank. is an analysis of how the African Continental Free Trade Area Agreement can boost growth and reduce poverty by leveraging trade and foreign direct investments. This report has benefited from the comprehensive guidance of His Excellency Wam Kelly Pen, the Secretary General of the AFCFTA Secretariat. I would like to express our deep appreciation for his visionary leadership in building the AFCFTA Secretariat as the powerhouse fueling continental economic integration in Africa. As an expert in international trade law, he served law firms in London and Hong Kong prior to joining government. He headed the South African mission to the WTO and was South Africa's lead negotiator in the AFCFTA. The topic of the report is very dear to my heart as the director for Regional integration in the World Bank covering Africa and the Middle East and North Africa regions. The AFCFTA agreement promises to be a game-changer for regional integration and consequently for growth and development in Africa. It enables countries to overcome impediments to the free flow of goods, services, capital, people, and ideas. Freer exchange across borders can accelerate social and economic development. Several sub-regional agreements on trade and investment facilitation in smaller blocs do exist in Africa. However, the continent-wide scale of the AFCFTA and its ambition to build an all-Africa synergy in trade is unique and laudable. An open continental market with lower tariff and non-tariff barriers for trading goods and services, as well as fit for purpose rules on investment, on competition, intellectual property, and e-commerce, will help make Africa more competitive, attract investment, industrialize economies, and reduce dependence on imports. With this confidence in the promise of the AFCFTA, the World Bank Group is stepping up its engagement with the African Union Commission, with the AFCFTA Secretariat, and with regional economic commissions to support a faster and better economic integration of Africa. Today's event is just one link in the broader chain of development cooperation between the bank and the AFCFTA Secretariat. We were delighted to have the opportunity to support the AFCFTA process through analytics such as the report being launched today, negotiation support, compiling data and tools required to enable governments to negotiate commitments and monitoring implementation. Proper implementation is vital to ensure that the benefits of the AFCFTA reach the last mile. Focusing on tangible results will require concrete activities and policy actions at national, regional and continental levels. We look forward to continuing our close collaboration with the AFCFTA Secretariat to support effective implementation of the AFCFTA treaty and protocols and unlock its benefits for Africa and for the world. I thank you for your attention and wish you all a good discussion today on the rollout of the FCFTA in an effective and efficient manner across the continent. Many thanks to Bina and as her role of regional director for Africa, we heard the commitments of the World Bank to engage with the African continent and make this ACFTA actually happen. So I now turn to His Excellency Secretary General Mene, who will make an opening address. Secretary General Mene is an expert in law, particularly international trade law. He was the head of the South African mission to the WTO. He also chaired the Committee on International Trade of Financial Services at the WTO. He was South Africa's lead negotiator in the ACFTA and Chief Director for Africa Economic relations in South Africa's Department of Trade and Industry. Your Excellency, the floor is yours, and thank you again for joining us. Thank you very much, uh, indeed for, um, uh, for inviting me to participate in this event. Um, and thank you very much to the World Bank for the partnership and, uh, the continued, uh, collaboration which started really, um, at the beginning of the negotiations. And I want to thank in particular, Roberto for his tireless efforts to make sure that we get the support that we needed, uh, to, to, to, to reach this point of, uh, immense progress that we have reached in less than 5 years. And so, I want to really express my very, very sincere appreciation to Roberto and his team, uh, who have worked, as I say, tirelessly over the last 5 years. To support the work, uh, that we do. Yesterday, just yesterday, I spoke at an event and, and I reiterated some of the very positive projections from the 2020 report. Uh, today we have a new report, which, which is even more encouraging in terms of its projections about the AFCFTA. Uh, particularly the, um, the AFCFTA as an enabler for pushing back on the frontiers of poverty, particularly for, um, for women-led businesses, closing the gender gap, lifting millions and millions of Africans out of poverty, uh, through a trade instrument. And I think that there could not be a much more powerful symbol of what Trade liberalization can do for a country or a region or a continent's, uh, economic outlook. I think these projections, these very positive projections, uh, uh, underscore the importance of trade and of course, what we all know, the, the positive link between trade and, uh, development. Let me give you a few, uh, uh, let me for a few minutes, give you an update of where we are in the implementation of the AFCFTA and why the report, uh, matters, uh, so much. When we last spoke, virtually, when we had a similar event virtually in 2020, as we had at that time, uh, maybe a handful of countries who had ratified the agreement establishing the AFCFTA. Today, we have 43 countries that have ratified the AFCFTA. We have only one country that has not signed the agreement. To me, this demonstrates political will, and of course, it demonstrates legal commitment to reduce barriers to trade in Africa, to reduce barriers to investment. To tackle long-standing challenges of industrial development on the African continent, and of course, using trade as a tool, uh, for, uh, achieving regional and, and global competitiveness. And so, it's clear in my mind that with these 43 countries that as we speak, have ratified the agreement, Uh, that we will, we have the requisite political will that, uh, we need to, to make even more progress than we have achieved, uh, thus far. We have, um, a, an agreement that is very comprehensive in scope, as you may be aware. Uh, we are negotiating the agreement in phases, in phase 1 and in phase 2. Phase one of the agreement includes trade in goods, trade in services, And dispute settlement. These are the three protocols in phase one. We have started operationalizing the protocol on dispute settlement. We are in the process of, of appointing, uh, members of the appellate body because we understand the significance, and the importance of predictability of markets, certainty of markets, the rule of trade law, and of course, um, in this case, the trade law being the AFCFTA. So, the, the protocol on dispute settlement is well in the way of being operationalized and, and being implemented. Uh, the protocol on, uh, trade in services. Here, we are, um, not making as fast progress as we are in dispute settlement and in, uh, trade in goods, which I will come to in a moment. And that's to be expected, uh, because of the nature of the complexity of, uh, trade and services agreements, uh, uh, uh, trade and services negotiations, which require Um, extensive national consultations with regulators, with professional, uh, bodies, uh, and a range of other domestic stakeholders. However, we do have 29 countries that have made, uh, offers, uh, services offers. So the negotiations are, are ongoing, uh, and we expect that by the end of the year, we will see even more, uh, progress. In the area of trading goods, this is also where we have made tremendous progress. We have reached agreement on 88.87%, I'm sorry, 88.8% uh convergence on rules of origin. If you think about it, In Africa, we trade close to 5000 products, close to 5000 products that we have been trading using different rules, uh, from this region to that region, or of course, using MFN rules, WTO rules. We now have reached convergence for preferential trade on 88.8%. Rules of origin and that is, is significant. We are still negotiating the automotive sector, which is about 1.3% of our tariff book. We are still negotiating textiles and clothing, which is about 13%. And then there's a scatter of uh different tariff lines such as edible oils, sugar, and so on, where we still need further negotiations. The point is, um, we are as close to 90%, uh, as we possibly can be at this point, and we have to start trading on the basis of these agreed rules of origin. In less than 5 years, uh, we have been able to achieve this progress. Um, 2 years of a pandemic. So it has been incredibly difficult, but, uh, I believe that we are now ready. Um, we've established the legal foundation, that is the protocols that I've just mentioned. Um, we have the trading documents. Uh, we have certificates of origin. Uh, we have, um, origin declaration documents. Uh, next month, we will publish the AFCFTA tariff book, uh, which is important for transparency and predictability of traded products. And so I believe that with these um components, uh, we are indeed, uh, uh, well on the way to, uh, uh, commercially meaningful trade. So from our point of view, phase one is almost concluded. Of course, uh, at national level and regional economic level, which is customs unions, that's where the rubber hits the road. That's where we expect the implementation to happen. That's where we expect the trade to happen. We have been working very closely for the last 2 years with heads of customs authorities in Africa. This year alone, we have had about 5 or 6 meetings with customs authorities so that we improve their capacity to implement the agreement, enhance their understanding of the obligations under the agreement. And uh give them the due recognition that they deserve that customs authorities will really be at the cutting edge of implementation of this agreement. And so, we are working very, very closely with customs authorities who are required and are very important for implementation of the AFCTA. We're also working very closely with customs authorities and regional economic communities. We have just had a meeting, uh, two months ago of regional economic communities, uh, where we discussed this issue of coordination in the implementation of the AFCFTA. Now, phase two is, um, all of the issues that, um, we were directed by the heads of states to include in the legal architecture of the agreement as a complementary to the trade liberalization that we want to see. And phase two includes a protocol or protocols on investment. That is to say, investment protection and facilitation. On digital trade, on intellectual property rights, on competition. And more importantly, for inclusion, a protocol on women and youth in trade. We started this negotiation of the phase 2 protocols late last year. We were delayed by the pandemic, and now that negotiation is proceeding. We have a deadline to conclude these protocols by the end of September this year. We believe that, uh, this comprehensive approach of including the traditional areas of trade, trade in goods, trade in services, as well as digital trade, um, a protocol on digital trade which will embed into legally binding obligations, a regulatory framework. For electronic trade and commerce, uh, in Africa, uh, which will include, uh, uh, payments, uh, regulations on payments, the data processing and the movement of, um, of, of, of data across, uh, countries in the AFCFTA, uh, uh, state parties. It's a very important uh tool, especially as we all know, uh, given the pandemic, but also, more importantly, given the fact that Africa, as you know, has been, um, at the, at the, uh, really at the center of technological and digital advancements. You will remember that, um, the first country to ever introduce mobile payments uh in the world, uh, is, uh, is Kenya through M-PESA, which has, which has really revolutionized how trade um and has ensured that trade. Reaches millions and millions of people, uh, and has ensured that we see inclusion of trade and finance, uh, through this, uh, uh, mobile enabled, uh, technology. And so, these are the areas that we want to capture in the protocol on digital trade. There are other tools that we have introduced because uh we have a very unique context in Africa. We cannot just negotiate a trade agreement and leave it. We have to introduce complementary tools for implementation of the trade agreement. And I will take a minute to mention just a few. First, um, is the Pan-African Payments and Settlement System, which along with African Bank, uh, we, uh, launched on the 13th of January this year here in Accra. And really, the Pan-African Payments and Settlement System takes account of the cost of currency convertibility, the challenge of, uh, um, uh, inefficiency of having 42 currencies and the impact that has on trade. Uh, as well as the need for inclusivity, particularly for small medium enterprises and young entrepreneurs. We now have 48 commercial banks that are trading on the platform. Uh, uh, you, you can be in Accra and trade with somebody, um, in another part of the continent. You can be in Accra and you trade with your counterparty in Egypt using your local currency, Ghanaian CD. Your counterparty that you transact with in, uh, Egypt will receive, uh, in Egyptian pounds. And so, the, first of all, the, the, the, the first objective of the payment system is to ensure we, that we enhance competitiveness of our small medium enterprises, as well as ensure inclusivity. By spreading this availability of this tool to as many people as possible so that they can trade across regions and across borders. This will be a game changer for trade on the African continent. 42 currencies is a constraint to to trade. It presents unnecessary costs to trade. $5 billion by our estimate is the cost of currency convertibility as a result of relying on a third currency when we want to trade amongst one another as Africans. The second important tool. Is the AFCFTA adjustment fund. And through the AFCFTA adjustment fund, um, we intend to assist countries who will, uh, in one way or the other, suffer adjustment costs as a result of implementation of the AFCFTA. We know that, um, uh, not, not all countries will be immediate beneficiaries because, uh, countries on our continent are at different levels of industrial capacity. Different levels, uh, of export, uh, readiness or export capacity. And so we have to take account of that, and we have to take account of the fact that many countries continue to rely on, um, on, on tariffs as a revenue generating tool. So, as they eliminate their tariffs, as they reduce and eliminate their tariffs, we have to find, uh, other ways of providing them with the support that they need. But the AFCFTA adjustment fund is not going to be, it's not intended for budget support. It is intended for productive sector, uh, support to an industry, in country or to a, a sector. A country may decide that, um, we would like to retrain our workers and deploy them in another part of the economy. Uh, an example is, I have just come back two months ago from Lesotho, and there's a very, very globally competitive, uh, globally competitive manufacturing plant. They manufacture, um, uh, uh, car seats. Employing over 750 people, many of them women, paying decent salaries, but the government had to invest significant amounts to train the workers who were going to be employed in that factory. Which is part of an automotive value chain. Uh, and so, the adjustment fund is envisaged in such a way that, uh, in the example that I cite of Lesotho, the government of Lesotho would have had access to the fund, to the AFCFTA adjustment fund, so that the workers are retrained and that they are deployed, um, in, in decent paying jobs that require a high level of skill and, and, and training. The 3rd area, uh, the 3rd tool rather, rather, which is also very important. Is um the trade finance facility. Trade finance facility, which we're in the process of negotiating to enable small-medium enterprises, particularly those that are led by women, um, and young entrepreneurs to have access, uh, to, uh, the entire African market. Uh, the cost of trade finance is very high. Uh, the access to trade finance is very low. Um, some commercial banks do have, uh, trade finance portfolios, but as we all know, the, the uptake is very, very low. And so we have to do more. We have to mobilize our development finance institutions, uh, the African Development Bank, African Bank, and others, and others to ensure that, um, access to trade finance is, uh, improved, working with, uh, uh, all relevant, uh, uh, uh, stakeholders. Your Excellency, uh, this is, uh, so I, I would like to, um, ask if you could possibly, um, um, uh, finalize your comments, uh, as we have other speakers waiting, um, so please go ahead. Thank you. Yes, the last area I would mention, thank you very much. The last area I would mention, which again is, is, uh, is important, is, uh, the, the trade corridors. Um, we are taking steps to make sure that the interventions that were made in other parts of the continent that led to successful, um, uh, successfully and competitive trade corridors, such as the East African Community. That we model, uh, we use that model to expand to the rest of the continent to ensure the effectiveness of our trade, uh, of our trade, uh, uh, corridors. So these are the interventions that we have made since the establishment of the AFCFTA Secretariat, because we recognize that an agreement by itself, uh, with the positive projections that you have made, that the agreement by itself is not adequate. We have to introduce other tools to make sure that, um, we See successful implementation of the AFCFTA. So, thank you very much for the, um, the opportunity. I slightly ran over time, but I think it's a very, very important, uh, to provide you with a comprehensive update of where we are in the implementation of the AFCFTA. Thank you very much. Thank you very much, Your Excellency. Indeed, this update was of tremendous use, and, and actually the challenges you are facing, as you mentioned, are very similar to other regional integration or free trade agreements that are being implemented. So you are doing extremely well. Uh, and I also appreciate that you are already thinking about the complementary actions, because by itself, uh, the, the agreement will not lead necessarily to the impact uh you are looking for unless these complementary actions are taken into account. So thank you so much for joining us and thank you for this uh great update. Uh, let me, um, uh, invite our senior economist, uh, Marilla, uh, Malisquestra. Um, who is one of the main authors of the report to present the results of our study. Thank you, Marilla. Over to you. Thank you so much. Good morning. Good afternoon, everyone. Um, let me share my screen. Um, So it's taking a while. OK. and um Um, can you see my screen? It's all good. You have to change the display settings. Just click drop down and switch it off. The trouble is that it won't let me. Oh, OK, perfect. OK. So once again, thank you for joining us today and um as um I'd like to start by saying uh a huge thank you to the AFCFTA Secretariat, um, who's uh the colleagues from the Secretariat have been extremely um uh helpful in providing guidance and continued collaboration on this report. So just a big thank you also to the team of researchers, colleagues from within and outside the bank who have contributed to this report. Um, The AFCFTA has the ambition of linking 55 countries with 1.3 billion people and a combined GDP of $3.4 trillion into one single market. It provides a tremendous opportunity to stimulate Africa's trade and investment and thereby contributing to its industrialization, to accelerate economic growth and create new jobs and reduce poverty. Um, the negotiations are progressing well, and there's no one better to tell you about it than the Secretary General, so, um, I will not be going into details here just to say that we, uh, this is exactly what we're looking at in our study at the, um, thesevi AFCFTA negotiation phases and what they mean in terms of the gains in terms of trade and growth and jobs. Um, so together all these ambitious steps, um, uh, in terms of the liberalization of trading goods and services, harmonization of the rules, uh, in terms of competition, investment, digital trade, um, intellectual property rights, they have the potential to boost income in Africa by 9% and the 150 million people out of extreme poverty by 2035. It also has the potential to create 18 million new jobs. Uh, let me explain how this potential could be realized. In our report, we have explored three possible implementation scenarios. First, we start with the baseline scenario, which is what would have happened and what would be the parcel of growth, investment, trade, uh, jobs if the AFCFTA did not take place. And then we compare our scenarios against this baseline without the AFCFTA. And those who are familiar with our 2020 report will have seen the trade scenario already, where we look at the reduction in tariffs, we look at the reduction of non-tariff measures in trade in goods and services, and the implementation of trade facilitation measures. What we do in this report, we extend the analysis to include two additional scenarios. The FDI broad scenario builds on the previous scenario by adding the changes in FDI flows to account for the boost in FDI coming from the AFCFTA, just basically covering the preferential agreement cover all countries at the continent. So there's no longer the spaghetti bowl of regional agreements. There's one single FTA. Then we look at the FDAD scenario and what we do here, we basically look at the expansion of scope and depth of the commitments. So we're just also adding all this phase two and phase 3, topics, harmonization of rules and reduction the resulting reduction of trade costs and additional boost to FDI coming from the harmonization of those policies. So once we have those three scenarios, um, we look at the implications for, for growth and trade and investment, poverty reduction, jobs, and, and, and so on. First, let me start by saying what do we think might happen to the potential loss of FDI as a result of AFCFTA. Um, what we, uh, what our estimates have shown is that the, uh, the AFCFTA could provide a significant boost to intra-Africa flows of foreign direct investment. The Intra-Africa FDI could increase between 64 and 68% relative to its, uh, level of in 2017, uh, depending on the level of ambition of the agreement. We also foresee an increase in FDI from outside of the region. And what the most ambitious scenario, these inflows could actually more than double. Foreign investment brings know-how and helps firms join the regional and global value chains in boosting productivity. Deepening trade flows and diversifying to other industries could reduce Africa's dependence on volatile commodity exports. What we see is that exports between African countries, especially manufactured goods, could double by 2035, and this would generate this additional boost to trade investment could generate significant income gains. We estimate. That the income gains could reach 571 billion by 2035 at the continental level. This would create higher paid, better quality jobs, especially for women. When we look at the results across countries, we see that uh all countries see the potential to gain from AFCFTA. The biggest, the, the gains range from 5 to 15% uh in terms of income boost by 2035. Again, we're comparing to the scenario, uh, the baseline scenario with no AFCFTA. Uh, the biggest income gains are expected in Cote d'Ivoire, Zimbabwe, and Namibia, and an average boost to income of 9% in the continental level, um, could be expected. Now, uh, just by accounting for the impact of FDI, we see an additional gains of 20% on average compared to our 2020 scenario, uh, 2020 report. However, these are really conservative estimates and should be seen as a lower bound of the gains, um, that come originally from the 2020 report covering the reduction of tariffs, non-tariff measures, and trade facilitation. The most ambitious scenario, the FTA deep scenario, uh, increases the gains, especially for some smaller countries which are in bad need of FDI new investment flows and which are originally facing really high trade costs, and such small countries include Burkina Faso, Senegal, and Namibia. Just to give you uh an uh uh a bit of a, and a more in-depth uh view of what might happen to, to trade flows, we see that the, um, the AFCFTA really provides a significant boost to Intra-African flows. Uh, exports. For example, the biggest gains would be expected in manufacturing, up to 134%, uh, quite a significant boost trade in services, boosting overall exports by over 109%. Overall total exports from the continent, so just combining into an extra African flows could increase by about 30%. If we have the successful implementation of the ambitious agreement as compared to the baseline without the agreement. So significant gains to be realized there. And finally, these gains in trade and FDI that boost growth have significant implications for poverty reduction. So what we estimate is that the number of poor would have increased in the baseline from 479 million to 317. We're talking about extreme poor living at $1 a day, $1.90 a day. And purchasing power parity terms. What we see is that the AFCFTA has the potential to reduce the number of extreme poor by the additional 50 million by 2035 and of course the number increases with the degree of ambition of the agreement. Finally, just to give you a two very, um, 22 country examples, uh, we have results for about 30 countries, but if you look specifically at each country depending on their comparative advantage and, and the trade cost reduction, the, the different sectors are likely to, to benefit. Of course, there are some sectors that could potentially lose wages here highlight the top 3 sectors that would, could see a boost to employment. Um, of selected Tunisia because of the delegation of the Tunisian minister we'll be speaking to later, and we could see the potential of the equipment to generate jobs in textiles, in manufacturing, in processed food, and those have the potential to boost wages by about 1510 to 15%. Depending on the intensity of the employment in those sectors, uh, um, and different types of workers are likely to gain, uh, as a result on average. In Tunisia, it so happens that because, um, the, um, Uh, some of the sectors are at risky intensive like manufacturing and processed food. Those wages of workers of skilled workers could grow a bit faster than unskilled, but everyone gains. On the other hand, in the case of Rwanda, we see a faster growth of female and unskilled workers, but again, everybody's wages are growing faster in case of the agreement. Just to wrap up, what are the steps to unlock the potential of the AFCFTA, and this is really what um what um Secretary General has already mentioned, and, you know, what needs to happen to translate these opportunities that the AFCFTA provides into more export investment and jobs. And there's several elements, um, so. It's critical to increase the ownership of the private sector in the AFCFTA process. Uh, it will be, will be the enterprises, not the governments that will generate this trade and investment and economic expansion. Further, it's critical to pair the AFCFTA with a strong complementary agenda. Governments with the support of the regional economy communities and of course the AFCFTA Permanent Secretariat should engage in multi-stakeholder consultations. Um, in each country to prepare a robust complementary set of actions and policies aiming to three concrete objectives. This is treaty administration, cross-agency implementation, and transition to free trade. What do we mean by those terms? Treaty administration is to really the ability of the trade ministers to, to enforce the implementations, to monitor, to undertake problem solving activities benefiting the private sector when trading. Cross agency implementation really means establishing some coordination protocols and enhance capacity of those agencies, uh, that have impact on trading goods and services such as customs, SPS, uh, regulatory bodies for services sectors. And finally, the transition to free trade means that monitoring the impact on Sectors uh addressing um any uh potential uh vulnerabilities and the workers that might be potentially displaced, setting mechanisms to ensure the smooth transition that it's uh that benefits, um, um, um, as many sectors as possible, uh, in this transition to open uh continental market just to wrap up. As the Secretary General keeps saying, the time for change is now. I'm hoping, uh, I've convinced you that our team has come up with the analysis that really shows significant benefit of the implementation of the AFCFTA, but of course, significant challenges remain, and I'm looking forward to hearing from the panelists, um, to discuss the role of the government and the private sector in making this agreement a success that it has the potential to be. Thank you so much. Thank you very much, Marilla. Uh, let us move now to the fire chat, and we have with us Doctor Marie Pangestu. Uh, she's the managing director for Development Policy and Partnerships at the World Bank. Dr. Pangestu has also had a political career serving as Indonesia's Minister of Trade, as well as tourism and the Creative Economy Minister for 10 years between 2004 and 2014. She's an international expert on a range of global. Issues and has vast experience over 30 years in academia, international organizations, and government working in areas related to international trade, investment and development, multilateral, regional, and national settings. Um, we also have, uh, Mrs. Saida Hashisha, uh, director of Economic and commercial cooperation, and Mr. Shawki Jabali, director of Africa from the Ministry of Trade of Tunisia. Attending on behalf of Mr. Minister Rabi, who could not attend and had to cancel. Unexpectedly, so we are, let me start with you, Ibu Mari. When you were Trade Minister of Indonesia, you were responsible for regional trade negotiations, including with ASEAN. And in fact you served as chairperson of ASEAN in 2011. Please tell us about your experience in those roles. What steps does a government need to take to benefit from greater regional integration? Over to you, uh, Marie. Uh, thank you, uh, Mona, and good good day to, uh, everybody, uh, on this, uh, call. Let me just, uh, share if I can, uh, four things, uh, my own learning, uh, through my journey with, uh, both doing the analysis as well as trying to implement, uh, regional integration in the Asian context and what, uh, we can learn from that, uh, in, in today's context as we have seen a very strong political commitment for the first time, uh, in, you know, in the breadth and depth of the ACF, uh, AFCTA. Uh, did I get that right? AF AFCFTA, I missed the F. Um, uh, I, I would really like to just share 4 things. Um, I think first is building the case for the benefits, uh, of the regional integration, which, uh, I think this report has, uh, is really going to help, uh, to, uh, emphasize the benefits, uh, from the, the regional economic integration, whether it's growth, uh, job creation, poverty reduction. Uh, and inclusiveness, and you have to kind of go beyond the, the, the, the big numbers to finding examples in sectors and, you know, because it's called a trade agreement, a lot of, there's always a lot of misperception that this is only about trade, but a lot of the benefits will come from investment. So you have to make sure you, you see the nexus between trade and investment coming through. And typically most trade agreements, as this one in the first phase is going to look at the cross, cross border barriers which is the trade non-tariff measures and the trade facilitation, and I just wanted to emphasize on, on facilitating the movement of goods and people is kind of key and it is sometimes the easier part. Of, of, uh, of a trade agreement and it goes beyond just the, the, the regulations, you know, like in the case of trade facilitation, having a single window, for instance, in each country and then having the single window talk to each other between countries, that's one part of it. But in the case of Africa, what I did learn from my trying to understand. Uh, what would make it, what would it take to work in Africa? I think the infrastructure connectivity is going to be key to, to be in parallel, uh, with the, um, with the, uh, you know, the agreement on customs and, and goods movement and so on. So I think coupling that with, uh, with the road as well as because we're talking about digital telecommunications connectivity, I think will be important. And the final thing I would say about benefits is the way we used to explain, especially to the, uh, to the, you know, because you have different levels of development. You have the same case here and you've got many, many more countries here. You've got 52 countries and 43 are already on board. The lesser. Developed compared to the more developed, the lesser developed needs to be the capacity building and the kind of you have, you are on a slower timeline or you are doing it with capacity building is going to be important to provide the arguments for these countries to face their constituency. Second, you will always hear this the countries and the sectors that feel that they are going to be, you know, squashed or disappear with regional integration, you need to really have a discussion with the private sector, with all the stakeholders to assure them that. A transition will happen. There will be capacity building. There will be the time to adjust. There will be opportunity because the static benefits that you have outlined, I would say the benefits that you've outlined in your report tend tend to be static, and we know with all regional integration the dynamic benefits. benefits can be larger than what we are seeing now as the kind of static benefits, and you can reflect on on other regional integration on that. And I think I just want to emphasize that for Africa this is so timely because of all that's happening in the world today, the fact that, you know, apart from COVID trade in the importance of trade in recovery and development mentioned by the Secretary General Mendez. I think you can see that the supply chain disruptions and this kind of resilience versus efficiency discussion is leading to regional value chains. So I think the benefits of, you know, in a region. to have different countries have different complementarities that you can build regional value chains, I think needs to be really emphasized in the case of Africa. In the case of ASEAN, we actually at the time looked at intraregional complementarity to increase our regional. Competitiveness vis a vis the external market as well as for our own regional market, and I would like to suggest that this is still a valid argument, especially in the case of building regional value chains. You can take food where Africa is mainly importing food. This would be a really great opportunity to develop that. A third point, distribution. This is the complementary agenda that I think was emphasized in the report. You do have to make sure that you address the distribution potential distribution effects, and it will need complementary policies. I heard the Secretary Mendez mention. Uh, there was a protocol on women and youth, uh, and, you know, how to make sure that translates into national policies. The final thing I would say, I would add is that I think that in your last slide, Marilla, you had, uh, you had, uh, you know, engaging in multi-stakeholder consultation by government. Um, and it is about ownership with the private sector. It is about the stakeholders. I just wanted to mention one learning on the government side. It is about treaty administration and And so on, but I tell you, the two things that I would share from our own experience with ASEAN, I think it's still a continued process, is how do you get interagency coordination that is really key for each country to be able to implement this free trade agreement. And in the case of ASEAN, in the end there was an agreement, and this, I think the Secretariat can reflect on this, to actually have countries create, you know, it would be called AFCT, AFCFTA coordination task force within each country that needs to be headed pretty high up in the government. And they serve to be the coordination body to implement the different parts of the agreement and to, you know, do their job in terms of following up with, with each of these agencies. Without that, it really is tough to make it work and that those bodies are the ones that need to make it happen. And those are the bodies that need to be supported by capacity building to, you know, support, facilitate the different agencies to be able to meet the different, um, the different components of the treaty, and, and I think this, this is just input for the Secretariat as well as how to make it happen at the country level. Let me stop there. Thank you very much, Ibu Mari. I think your, your practical experience is of tremendous, tremendous help for, for the kind of work that we do. We look at the analysis, but there is nothing better than actually having gone through it. I retain several messages from what you mentioned. First, that the FTA is not just about trade. It's about investment. Uh, it is going to have its, it's, um, uh, main impact on investment and from there on growth. The second is that, um. In in in the region in ASEAN as well as in Africa, we have countries with different levels of development and therefore the implementation will have to be paced to their level of development and the less developed countries may need capacity building in that process. You also, you also mentioned the need to deal with the resistance that will come from the private sector. It will require a change and adjustment as well as new opportunities, but there is always fear, and we The government will need to address that and meet with the private sector, and we have a 2nd session of this seminar with the private sector. Also, the need to be very careful about the impact on distribution and impact on the poor. And finally, because of the complexity of a free trade agreement as it touches many sectors and many ministries, interagency coordination is also important. So these are great lessons, Ibu Mari, and we will dig more into, into those. Uh, let me now turn to, um, the representatives of the Tunisian ministry. Um. Madame Saida Hashisha and um um Monsieur Chaoukijabali, uh, you may speak in French if you prefer, and we will have uh um simultaneous translation Vuve pardon of Francais vuve pose vare of France jevela pose angle e je la repose of Francais, uh, a Fiona intradiction simultane don't. Um, So what do you see as the biggest challenges facing the ACFTA today? The agreement is moving from phase one to phase two of the discussions, which will bring its own challenges. And on top of that, the world is facing another food crisis, with food prices in Tunisia and elsewhere in the region soaring as a result of the war in Ukraine. Could that impact the phase two of the negotiations, and could the ACFTA be part of the solution to the challenges of food security? So there is one part of the question about the general challenges facing the implementation of the ATFTA as you see it today, and the second part that focuses perhaps a bit more on the food issue. Jespercua rima. So over to you. Thank you, thank you very much. Uh, I will try to, I will try to speak in English, but uh you, you will uh uh uh tolerate my, my, some difficulties maybe uh uh I may face when talking in English. Uh, but first of all, uh, let me, uh, uh, apologize on behalf of He, Her Excellency, uh Ms. Fadila, uh, Hamza, um, the, the Minister of Trade, which, uh, uh, who are not able to join you, uh, due to an urgent uh commitment with the government. Uh, so, uh, uh, Sorry, so, uh, I'm, uh, Shajabali. I'm a director of the cooperation with Africa, uh, in the Ministry of Trade, and I, uh, have been the, um, uh, AFCFTA negotiator, and here, uh, with me, uh, Mr. Said Miss Saed Aisha, sorry, the Director General of the International Cooperation in the Ministry of Trade. So, uh, uh, uh, regarding your question, Maybe I may classify the main challenges, challenges facing the AFCFTA into four main categories. First of all, I, uh, I would say, uh, uh, there are always some technical challenges with regard to finalizing the negotiations, uh, maybe for the first phase, uh, as we have, uh, always, um, Uh, we, we, we have to finish negotiating the first phase, uh, with regard to goods, services, and also rules of origin. And as His Excellency, the Secretary General said, we need to finalize some countries need to uh to, to uh to uh submit their offers. In services, goods, and we need to finalize the rest of the rules of origins. The second challenge, I think, is linked to legal and institutional affairs, particularly in terms of capacities of state parties to implement. The agreement at the national level. And here we are speaking about the institutional uh uh uh framework or institutional or internal organizations. We need to have uh national uh functional national committees, and uh also there would be a challenge regarding the transposition of the commitment. Uh, into the, uh, uh, national legislations. Here also is, uh, uh, it may be a challenge, uh, regarding the implementation of the AFCFTA. The third challenge, uh, I think also, and, uh, uh, it's something important that have been mentioned, uh, is, uh, about infrastructure, uh. Mainly we talked about air and maritime transport, and also uh maybe uh digital infrastructure to facilitate trade. The fourth and last um challenge, uh, in my opinion is an economy. Challenge and it's related to the mitigated economic impact if no measures to be undertaken with regard to trade facilitation, and particularly with regard to non-tariff barriers, as you know, we may have um Uh, an ambitious, uh, reduction of, uh, tariffs. But when it comes to, uh, trade barriers, non-tariff barriers, uh, maybe the challenge is there. Uh, so, uh, another economic challenge may be linked to the imbalanced effect, uh, uh, among member states or state parties, uh, especially, um, with regard to the, um, uh, to those uh relying heavily on customs revenues. Uh, maybe, uh, many states in Africa are heavily relying on, uh, customs, uh, revenues, uh, from imports. Finally, maybe if I can say the level of ambition uh uh agreed uh in terms of liberalization of trade in goods, maybe on itself, uh, uh, in my opinion, may be a challenge, because when we uh We, uh, we see that, uh, uh, trade liberalizations will be fully, full, uh, after 13 years overall. And we have 3% of the goods that will be uh uh excluded from globalization. So if you know that, that 3% of of goods may constitute over 90% of the trade of one country. So uh here we can, we can say that even the level of ambition may be in some sort a challenge. Hopefully, finally to finish with that, maybe that the Secretariat also has Uh, with its partners, uh, is leading so many activities. Uh, the SG already mentioned, the the um the PPPs, the facility adjustment, the African Trade Observatory, the mechanism for reporting, monitoring and eliminating non-tariff barriers. These are some, uh some uh um tools. That may support or mitigate these challenges. Uh, uh, so, I think that uh uh uh the AFCFTA is a good opportunity for Africa and for the world. And, uh, these challenges may be uh addressed. When all of us at the continental, national and regional level, we support each other with our international partners to achieve these results. Thank you so much. Thank you very much. I don't know, Madam Hashisha, if you would like to uh add anything or we will uh just proceed. Uh, uh, good afternoon. No, thank you. You can, uh, proceed. Mercy. Thank you very much. So this, this brings to an end the first panel, and we will now move to our next panel to discuss the importance of foreign direct investment or FDI in Africa and It can help African firms link to regional and global value chains. The ACFTA can be leveraged to improve the productivity of domestic firms by linking them to multinationals, via investment partnerships, trade, and countries in Africa with larger markets. And fewer trade barriers already attract significantly more FDI from inside and outside the continent, which offers encouraging signs about the potential of the ACFTA to boost FDI inflows. Still, Africa's level of FDA and global value chain intensity are low and underdeveloped compared with other parts of the world because of the fragmented markets, the FDI barriers, and the political and regulatory risks. I, I believe that the ACFTA can play a very crucial role in reducing the trade barriers for goods and services and thus boosting Africa's regional integration and global value chain participation. To discuss some of these topics, we have with us today Mr. Dave Coffey, the CEO of the African Association of Automotive Manufacturers. Mr. Coffee has extensive experience in the automotive sector. He has served as president of the National Association of Automotive Components and Allied Manufacturers. Um, and then we have uh also with us Dr. Edem Azogenu, who's the co-chair of AfroChampions, a regional, uh, public-private partnership promoting impactful regional investments by African multinationals. And finally, last but not least, we have our IFC Director of Sector Economics, Mr. Issa Fay. ISA directs the development and implementation of IFC's ex ante impact assessment system and is responsible for the monitoring, evaluation, and reporting of IFC's investment and advisory services. Previously, ISA was also with the African Development Bank. Let me start first with Adam. As a representative of the private sector in Africa. What do you think can be done to encourage deeper buy-in of the by the private sector, and how can the World Bank Group support stakeholders in reaching concrete results? Um, Mona, I think, uh, so I would step in for Doctor Ederewenu. Um, uh, unfortunately, he's unable to join. Um, so my name is Richard Edujavi, the senior advisor at, um, for Champions. So, uh, unfortunately, for some reason in my camera is also not, uh, picking up. So I think that, uh, if you can just hear me, let me know so that, uh, I go ahead. We can hear you. We can hear you, Richard. So please go ahead. Wonderful. Thank you. So thanks, uh, you for organizing the, this panel, and then, and then also showing to us all the results of, of the report which was done. Um, in many ways, I think we are able to connect to it. Um, I think that, uh, when it comes to how, uh, the private sector can be involved in the AFCFTA, uh, it's been said or uh Uh, Ms. P used to talked about the fact that, uh, or the report also talked about the fact that there should be that, um, ownership, uh, from the private sector. You see, I mean, when laws are made, when rules are made for the private sector, without the private sector sitting at the table to, to show or to talk about their own problems and challenges which will help shape the, the, the rules or the protocols, then it becomes difficult in the end to be able to um Uh, make the private sector active. I think that, uh, when the private sector is at the table discussing, certainly, it has a, uh, a lot of power to be able to influence many other or demonstration effect to influence the private sector, which is not at the table to be able to join the AFCFT clearly. Yeah. So, and that is, that is one point which I think, uh, would, that buy-in will come from having first of first and foremost that ownership uh from the private sector. But then again, that is not all. I mean, the, the, the private sector, uh, should be, uh, much more aware of the AFCFTA itself. And for some reason, I think that the, there hasn't been an aggressive marketing, uh, uh, from the private sector itself trying to eliminate. It may bring. Uh, for larger, uh, when we talk about the private sector, if I should disintegrate, I mean, there's a large corporations, uh, and then the others which is normally lumped into one that is the medium, uh, the, the, the micro, small, medium enterprises. So let's have this binary for discussion now. For large corporations, yeah, uh, there's a lot of sensitization going on which they are aware because they have research departments that normally are able to look at, uh, what is happening because they need to extend their market, look for markets every now and then. But for small and medium-sized enterprises, this is an issue. Um, I, I can, uh, in confidence, uh, or tell, tell you particularly that, uh, if I talk to my own friends who are business people, small business people, uh, they tend to ask, what is, what is, what is this AFCFT really about? Uh, so some of us, uh, whilst we engage, we try to make the Uh, the AFCFTA, uh, more, bring it to the doorsteps of the small and medium size. I mean, the, the simple charcoal or the simple banana seller has no idea. Uh, they think that it's just too high in the air for them. Uh, if you talk about it, unless it has been simplified, it's very difficult. So that part is there. So that aggressive marketing is really needed to get the buy-in of the private sector on this, on this as well. Yeah. Um, but then if I should see how the World Bank will come in, uh, may come in from the issue or from the part of the challenges which the, uh, the private sector faces. And here, I'm talking about mostly about the small and medium-sized enterprises. In many ways, trade finance is very difficult for, uh, to assess by the, um, SMEs. Simply because they do not have the collateral and the banks are actually looking for collaterals. Uh, in many cases, they have the cash flow, which in my understanding could have been enough, uh, to be able to, uh, hold to assess finance in order that they can trade, but that is not what banks are expecting. And so I think that here, maybe the, the World Bank can clearly come in in a way that, uh, funds may be readily available, not. The banks, but directly to the SMMEs because I think that is maybe where uh uh uh some of the issues are. Because when it gets to When, when funds go through the banks, they may apply their own rules again, and then it will be at the detriment of the SMEs. But when funds are able to get to SMEs with, with measures to, uh, I'm, I'm just rounding up, yeah, with measures to, uh, to, to guarantee, uh, I'm sure, uh, in this way there, there will be, uh, possibility for SMEs to excel under the AFCFTA. Thank you, Mona. Thank you very much, Richard. Uh, your connection just got a little bit, uh. Uh, messy at the end, but we hear, we heard, uh, pretty much everything. Thank you. Uh, Dave, your sector, the automotive industry, has been one of the most active in trying to leverage the expanded market that the ACFTA will bring. Can you give us an update on what the AAAM is doing to expand the automotive industry in the continent? Thank you, thank you for the opportunity to participate and good day. Uh, we are a private sector association where our members are OEMs, global component makers and service providers that add value to the sector. We, we are actively working with African governments, uh, to advise on or to develop, uh, and to implement automotive policies and ecosystems that attract investment from the OEMs and the component makers. Our, our industry requires scale because it's globally competitive and the AFCFTA brings that to, to the table. Uh, so, so it's at the heart of all our policy development, which I'll just touch on. And, and not every country can assemble a vehicle. And it's good to see that dynamic changing, uh, where people, where countries are actually saying, so let's define our niche in the value chain, which is critical. Uh, so we see hub assemblers developing in the four quadrants of Africa, supported by neighboring countries developing their value chains and supplying to, to the hubs. Uh, so our first key focus is on policy development. Our policy team, uh, worked with the Ghanaian government and developed the Ghana auto policy which was approved in, in March 2020. There are 3 assemblers, uh, doing light assembly at the moment, semi-knockdown, there will be another 4 by the end of the year. So it's really moving positively. We met the government of Egypt in September last year, the prime minister, and in two weeks ago, they actually approved an auto policy which changed the architecture of its administrative structure significantly. So they moved very quickly. The Ivory Coast advised me. This week that our policy team uh will be commissioned to do, to develop, to research and develop their assembly and component policy. So there's quite a lot of activity and momentum picking up now, uh on the on the continent. We've also worked closely with Kenya in supporting their, their policy rollout and we've provided Ethiopia with a draft policy. It's very clear that when a policy, a progressive policy is, is, is approved into law, uh, the investment follows. You just look at South Africa, Morocco, and, uh, and, and, and soon to be Egypt and Ghana. Ghana, the investment is, is, is, is following based on actual policy uh approval. So the policies we promote are those that are are compatible and facilitate production and trade. It's important that one does not focus on import substitution. One needs to trade. You've got to open up export and import and that's critical. The vehicle manufacturing, the vehicle manufacturing CEOs uh on our membership, uh, they, they have a clear vision. A model will be produced in one country on the continent and then traded across the continent. Trade out and trade back, uh, back in. Our second focus is on value chain development. Uh, we have visited, uh, Ghana, Kenya, Egypt. We understand the manufacturing capability in these countries. We'll visit Tunisia and Morocco in August and, and, and July and August. We understand South Africa well. What's important is we want to see component manufacturers that manufacture for the OEMs today extend into Africa. Go and partner with organizations in, in African countries, uh, and bring in the technology, bring them the capability. And they might, they might not be auto component manufacturers today in East Africa. African countries, they might be allied industries in oil or gas or mining. That's OK. Partner them and, and, and, and grow that capability. Uh, we've taken 5 component study tours into Ghana. Focus Ghana because the policy is as was recently approved uh in in March 2020. And, and the, the countries we took component makers from was South Africa, Egypt, and Germany. We want to see coming from these other countries I mentioned like Tunisia, like Morocco. Take them into Africa. Finding partners. Let's grow. We're also working with with other African countries that want to uh explore value chain opportunities that want to get into the value chain. Some of them are in, some of them are not in. For example, we've been to Rwanda, Lesotho, Gabon, Namibia, Botswana. Countries are coming forward and saying we want to participate. So we'll go and visit and see how they can actually uh participate in the value chain. It's very important and I'll, I'll end off shortly. It's important to share that in partnership and under the guidance of the African Continental Free Trade Area Secretariat and in partnership with Rexim Bank and the AU and ourselves, we, we, we are developing a continental automotive strategy. It will be shared with the uh senior trade officials and council of ministers in July for member state input. This collaboration is very strong. And uh and important for the development of the industry. And it's wonderful to see more countries approaching us, what we call the coalition of the willing. The private sector is interested in Africa is growing and we see it in our membership and across Africa. And uh as, as a previous presenter said, I think a number of presenters said, the time for Africa is now. Thank you. Thank you very much, Dave. It's always nice to hear from the private sector, the, you know, you're the doors on the ground and, and you are the ones who will drive change. Um, so, Issa, uh, you have had many years of experience working directly on development in Africa. In your view, what do you see as the development impact of the ACFTA through private sector investment? Thank you, Issa. You are muted, Issa. Can you hear me now? Yes. Thank you, Mona, for having me and thank you, colleagues. I, I enjoyed your discussion so far. And now maybe bringing just the perspective of impact, impact assessment, and then how the African continent free trade uh area could, could generate impact. I think that there is a tremendous potential to, to generate substantive impact. And then the way you would look at that an ex ante, like, uh, as we speak, we could say, That the theory of change that I can see here coming out is that by establishing the African continental Free Trade Area and supported by the right type of institutions and policies and infrastructure, uh, the continent will be able to attract more FDI and then trade more and better. And this would generate jobs, increase incomes, uh, diversify the exports, and then, uh, maybe also help, uh, reducing the carbon footprint and then generate markets. So, I think that there are two types of, I mean, I would assess this kind of impact ex ante by looking at, uh, two dimensions, the stakeholder kind of effect, which is, which, uh, constitutes of, uh, uh, effects that are direct or indirect and accruing to the stakeholders. And then also the systemic, uh, type of impact that would come from this type of work. If you look at the stakeholder mapping and, uh, effect, you would definitely look at, uh, effect going, uh, to consumers and households, some going to employees or firms, and then also, uh, some kind of economy-wide type of vehicle like value add, uh, uh, GDP kind of, uh, indicators and looking also at, at climate change and, and environmental effect. But in terms of consumers and households, they are key, key beneficiaries of the African Continental Free Trade Agreement, and I think that they would benefit from affordable access to goods and services because of the connectivity and more integration. There will be increased access to the services. Another indicator that we look at, for example, the assessment is better jobs and wages for employees because by attracting more FDIs to some of the sectors that are more, I mean, Uh, that requires more skillful labor, there will be more quality of jobs. So, uh, job, uh, quality is going to be one indicator that will be, uh, I mean, looked at and then including the, the wages, uh, the increase in wages. And there is some, um, some studies that show that the welfare gain of, can be up to 2.1% for the continent, uh, and then, Uh, some other, this was, uh, a study from the IMFA if I'm not mistaken. And there are other studies showing that, uh, there are going to be some gains up to 5%, uh, in, uh, when the, uh, with the reduction of trade barriers. So, they, we can also look at some gender dimension into that, that, uh, the wafer gain, which, uh, uh, point to women who are gaining 10.5%, uh, compared to men that will be earning just 9.9%. So, there is going to be this type of effect. That will come, which is very impactful. And then economy-wide, as I say, you're going to see some GDP increase and GDP growth, uh, from 0.66 to 0.997, for example, and then accompanied by, by employment and job creation. And then we expect also the manufacturing some increase in manufacturing of goods which will increase by 62% and then intra-African trade which has been very low now. What we would expect with this free trade area that can Increased by 110%. So a lot of impact coming. And then in terms of climate, and this is something that we need to think, uh, um, going forward and that this kind of free trade area can provide a significant scope for Africa to build resilience, climate resilient, and lower the carbon, uh, footprint on the continent by, uh, attracting investment into the renewable energy sector. And we expect that. Uh, the renewable energy capacity can grow to reach, uh, 310 gigawatts by 2020. So these are kind of the type of, uh, direct, indirect effect that I could see. And now in terms of the systemic effect, I think that there are 4 attributes of market creation that I would like to, to explore when looking at the free trade area. One is the integration, as, uh, the previous colleagues has said, there's going to be really great in terms of, uh, uh, market integration, connectivity. It will facilitate the development of national, regional, and continental, continental value chains. This is, this is tremendous in terms of, uh, generating markets that are more integrated. And then some study of the bank are estimating that, uh, a 10% increase in the global value chain would, could help boost per capita income, uh, by more than 10%. So this is really, uh, huge in terms of effect. And by, by, by 2035, the volume of total exports that can be generated from this connection to the global value chain can, uh, increase by 29%. So, pretty, pretty substantial. Another market attribute that I think would come from this, uh, uh, free trade area is competitiveness because by improving the policies that promote competition, innovation, and by lifting the barriers to trade, including, uh, putting in place. Putting in place sound legal and regulatory framework, infrastructure development, and so on. We believe that the, the African continent, uh, uh, continental Free Trade Area can help reduce transaction costs and thereby facilitating investment, pouring in. And then there will be some kind of pressure, uh, competition, uh, and then the incumbent will have to keep their tools and then innovate to deliver better products and services in an affordable manner. And then the, the e-commerce sector and the digitization that we're seeing in Africa is a case in point. Right. Another, another attribute that is, uh, coming out clearly is the sustainability one. The African, uh, continental Free Trade Area could contribute into creating a market around circular economy in Africa. And then, uh, some studies done by the African Circular Economy Alliances and the World Economic Forum are showing that the continent's circular food system alone can help a $1 trillion market to grow by 2030. So there's really, really, uh, important gains there and including also millions of inclusive green jobs to be created. And last but not least, the inclusive dimension that, that comes with the integration because with the FBI, with trade, I think that there's a potential to lift 3 million people out of poverty, and then make sure that their household and corporate, um, uh, firms are also, uh, uh, um, get some gains into that, into the process. And we estimate that. By 2030, the fully integrated market of 1.7 billion can generate, uh, 6.7 trillion of, of spending by consumers and businesses. So, um, uh, Mona, in a nutshell, a lot of impact can, can accrue from, uh, to beneficiaries and then in a systemic way to develop, uh, substantive markets. Thank you very much, Issa, for this, uh, great, great feedback. I think uh it's really important for the private sector to understand uh the benefits um that, that this ACFTA can bring, and you have, you have laid out all the issues very, very well. Um, we have, uh, with us, uh, Doctor, uh, Ade Azogeno, uh, the co-chair of AfroChampions who, who was able to join. Uh, and if that's OK, uh, Doctor Adam, I'd like to ask you one last question. Um, So we have been talking about the role of the private sector in taking advantage of the ACFTA and what will it take for that, but we are also concerned about small firms. What are the primary concerns that small and medium enterprises have raised in relation to the ACFTA and how can they be addressed? I, I, I think that, it's, it's a brilliant question. However, the, I have to, I would like to address it by stating the context, right? That in our attempts to drive integration on the continent, two realities exist and we've been doing this for a while with uh the the regional economic markets. That the big companies that have, uh, who are, who are the drivers of integration, uh, uh, do not have the capacity or the resources to invest in the public infrastructure. Uh, like roads, sports, and rails that will make it easy, uh, for, for the interconnection that we need the infrastructure, uh, for integration to happen. Then when it comes to the SMEs, the challenge we face is that the SMEs are currently, who are supposed to be the beneficiaries of integration. Uh, of, of this common market are focused on their domestic market. So an SME in Uganda does not wake up thinking about producing for Senegal market or for Cape Verde market. So, integration for us has to be a product that needs to be marketed. And that marketing has to bring into focus because by the sheer nature of the diversification, the fragmentation of the continent, it's important to bring some strategic stakeholders together. So, what are the challenges? The challenges are logistics, of course. The challenges are marketing, the challenges are regulatory. We know all of that. But how do we surmount that? So I, I, I like to look at it more from what can we begin to do practically because there's a lot happening in fragments. How do we bring them together to scale? And the theory of change for us at AfroChampions with what we are doing with uh, what we are calling the AFCFTA hub is bringing, for example, logistics operators onto a common platform, bringing, uh, because a market asset enablers like your malls, you have a lot of malls in Africa, for example. Uh, who are, who, who, who can take products of SMEs in one market and take it to multiple markets. But we have to bring the regulators, the food and drug authorities, we have to bring the customs operators as well. And then we also have to market. Branding is a very important thing. So, brand equity is also another area we're very keen on by bringing digital artists and music artists together. To begin to support SMEs to package products and brand products in a way that speaks to Africans. But not only Africans, speaks to the soul of Africans, but connects to the markets they want to sell it. Uh, and putting all of this on a digital platform that enables people to connect. will be for us the quickest way in being able to drive integration through trade whilst waiting for Port rail and other things to come on. So, I guess my answer to your question is that there are challenges for sure. But there are also solutions, and what we should be looking at is looking at the low hanging fruit solutions that exist in pockets, bring them together into an ecosystem. And when people begin to see that integration actually has results, as profits, because the private sector is only interested in profit, you can see that it's growing their money. They themselves will start marketing it and it will go viral. So that's my response to your question. Thank you. Thank you very much, uh, Doctor Ede. And with that, I would like to conclude this, um, this seminar and thank everybody for, for joining and sharing their views and, uh, to thank Marilla for her, uh, work, uh, and her presentation, which was the starting point of the seminar. I want to say that, um, There, there will be, there will be very few opportunities like the ACFTA to really, to really open the door for investments in Africa, and it can remain a trade agreement with not much happening, and we have seen that in many parts of the world. But as I hear from the private sector, the eagerness to actually take advantage of it and create opportunities and make this happen. I'm very hopeful that the ACFTA will actually lead to results, and it will lead to results in terms of trade, in terms of investment, that, and in terms of growth and employment generation that will be as inclusive as possible. And I would like to also urge the private sector to talk to the government and to talk to us to let us know what will it take for you to make this happen. You are the ones on the ground investing and facing all the challenges, and if we need to prioritize certain Uh, rules and regulations and reforms or activities, uh, as, as Mari Pangestu has said, this, this dialogue between the public sector and the private sector will, will be critical. So with that, uh, thank you all. I learned a lot, uh, and I really appreciate you coming and taking the time to share your views and your analysis. Thank you very much. Goodbye. Thank you. Thank you so much. Thank you.
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Mari Pangestu and Mene Wamkele are joined by a panel of experts for the launch of the new report: Making the Most of the African Continental Free Trade Area.
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