Dar es Salaam. Members of the business community in Tanzania have urged the government to consult widely, and remain vigilant before ratifying the African Continental Free Trade Agreement (AfCFTA).
Tanzania has already signed in for the ambitious continental free-trade zone, which African leaders launched on Sunday in Niger.
But Trade and Industry minister Innocent Bashungwa told The Citizen on Sunday that Tanzania was still in talks before ratifying the pact that if successful would unite 1.2 billion people, create a $3.4 trillion economic bloc and usher in a new era of development. Only half of the continent’s 55 states have ratified AfCFTA.
The International Monetary Fund (IMF) and analysts from various quarters have expressed optimism, but were also quick to caution that if not addressed, divergent interests across the continent may hinder the success of the pact.
In Tanzania, the business community seems be excited about the government’s decision to sign, but has agreed on the need for the authorities to engage private sector players before ratifying the pact.
“As the private sector, we expect to be involved in every step that our government takes towards the ratification of the agreement,” said Mr Frank Dafa, a trade policy specialist at the Confederation of Tanzania Industries (CTI).
He said the free trade zone provides an opportunity for new markets for Tanzanian products, but going forward, there is need for more stakeholder involvement.
“The one big challenge, competition, needs to be considered too,” he said. “If we are to enter into this agreement we have to effectively compete with the likes of Nigeria and Egypt, which are more industrialised.”
“The government needs to consult all the stakeholders concerned to make it easy for speeding up the processes.”
Mr Ali Mufuruki, chairman and chief executive officer of Infotech Investment Group Ltd, is optimistic about the prospects of the free trade zone. Speaking during the AU Heads of States Summit in Niger on Sunday in his capacity as vice chairman of the East African chapter of the AfroChampions Initiative, Mr Mufuruki said the AfCFTA offered several benefits to men and women who are engaged in productive activity and industry on the continent.
“For me, my colleagues in the AfroChampions organisation and indeed for all private sector operators of Africa, this day, the 7th of July 2019; will forever be remembered as the day when Africa took its boldest and most ambitious step in the long journey of the economic liberation of its people,” said Mr Mufuruki.
He said the coming on board of Nigeria, in particular, had erased all the doubts that market players had been harbouring for quite some time over the future of the integrated African marketplace. “I would like to appeal to the Government of Eritrea to get onboard the AfCFTA ship because it is the right thing to do and the time in now,” said Mr Mufuruki.
“I would also like to encourage the states that have signed but are yet to ratify the treaty to do so without further delay, so that we can begin this exciting journey together for the benefit of all our people,” he said.
Analysts believe that tariff-free access will result into a unified market that will see local manufacturers and service providers to leveraging on economies of scale. “The ratification will facilitate more industrial and value added jobs as a result of intra-African trade,” said Dr David Kamugisha, an economic expert and consultant based in Dar es Salaam.
Dr Kamugisha, a former lecturer at the University of Dar es Salaam Business School (UDBS) noted that the move will result also to an increase in demand and instigate an increase in production, which in turn will lower unit costs.
“Consumers will pay less for products and services as businesses expand operations and hire additional employees from across the Africa,” he said, adding that it would be effective if the government consulted all stakeholders including the private sector.