AfCFTA: African businesses have negative perception to trading, investing in goods across borders
African businesses have a neutral to slightly negative perception of the environment for investing and trading in goods across African borders.
This is according to the AfCFTA Country Business Index Report by the United Nations Economic Commission for Africa, United Nations Global Compact and the European Union.
Given the negative perception among Aft businesses, the report suggests that further work needed to be done by leaders of the Continent and specifically the AfCFTA Secretariat to remove tariff and nom-tariff barriers.
The negative perception held by businesses regarding trading across borders mainly had to do with unauthorized charges, customs procedures and ‘additional fees’.
“Particular attention should be given to addressing unauthorized charges and other charges on trade as they are perceived as the aspects that most restrict trade,” noted the report.
Touching on the difficulty of women-owned businesses to trade across borders as against men-owned businesses, the report asserts the former are disproportionately impeded by aspects of current trading regimes when investing and trading in goods.
Particularly, women-owned businesses are more negatively affected by tariff and nom-tariff barriers.
“Most SMEs are women-owned and so it is important to ensure that there are national and continental regulatory frameworks that allow them to participate in an efficient, effective and competitive way,” states the report.
“Policy makers should give special attention to addressing the challenges faced by women-owned businesses in trading across borders, with particular emphasis required on understanding and improving the perceptions of women-owned firms of additional and unauthorized charges, customs tariffs and customs procedures, which are currently well below neutral and more negative than the perceptions of men-owned firms. Enhancing the participation of women (and young people) in the overall economy is imperative to make the Area more inclusive and development more sustainable,” it further states.
The African Continental Free Trade Area Country Business Index is the first comprehensive tool based on a robust methodological framework in which data are collected in a way that allows businesses to express their views on implementation of the Area.
The Index differs from other integration indices, since it is informed entirely by private-sector perceptions, not by secondary data, making it truly representative of African business.
A key focus of the Index is to show how the business sector perceives trade under the free trade agreements that are already in force across African countries.
Phase 1 of the AfCFTA Country Business Index Report was conducted in Cameroon and Zambia.
The present report [second phase] includes results from seven countries namely Angola, Côte d’Ivoire, Gabon, Kenya, Namibia, Nigeria and South Africa.
In the third phase, the Index will be rolled out in the Democratic Republic of the Congo, Egypt, Morocco, Rwanda, Senegal and Tunisia.
