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Africa Wants To Become A Giant, Interconnected Trading Region

Africa Wants To Become A Giant, Interconnected Trading Region

Africa
Lagos, Nigeria. Photo by Temitayo Aina on Unsplash

Just as trade wars and Brexit are splitting alliances apart, at least one area of the world is coming together.

All but one African country signed a continent-wide free trade agreement — the African Continental Free Trade Area — which economists are saying could open up the region for increased development.

Story from The Hour. Story by Yusuf Khan.

What the agreement aims to eventually achieve is a potential European Union-like allowance for free movement across the continent, tariff-free trade and perhaps even a common currency.

Put simply, Africa as a continent has struggled with economic development. And while there are hundreds of reasons, communication across the continent is a key factor.

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The African Continental Free Trade Area will be home to more than a billion people, 55 countries, and would eclipse the EU as the biggest free trade area in the world. 90% of tariffs would be scrapped within five years, but some of the poorest African nations Niger and Malawi will get an extra five to 10 years on tariff reduction to protect producers from the cheaper imports.

Traditionally, you trade with your neighbor. But this hasn’t happened in Africa.

Instead, twice as much trade occurs with Europe than other African countries in the continent according to The Economist. Why? Colonialism.

Have a look at this map below of the spartan nature of African railway networks. Historically, railways were built between colonies and not other neighbors.

Read more at The Hour.