Zenith-AfCFTA Collaboration

The African Continental Free Trade Area Agreement (AfCFTA) continues to make inroads across Africa under the shared vision of the African Union in eliminating trade barriers and boosting intra-African trade across all sectors of the African Economy. The recent collaboration between Nigeria’s Zenith Bank and the AfCFTA in establishing a cutting-edge smart portal for information aimed at accelerating intra-trade dynamics is an indication of the commitment between the private sector and member states in driving success under the agreement. Zenith Bank committed $1 million towards funding the development of a unified and dynamic trade information portal for the continent.

The AfCFTA requires transformative and innovative solutions and strategies to catalyze intra-African trade. The trade information portal is one such strategy that is bound to drive knowledge sharing and collaboration among African entrepreneurs driving increased trade and investment. By showcasing African products and services while enhancing seamless transactions and connections across different regions and countries, the portal will revolutionize trade under the AfCFTA. This can foster increased economic prosperity and the realization of the continent’s untapped potential.

At the heart of the AfCFTA is the need to dismantle trade barriers and create a level playing field where the free movement of goods, services, and people across the continent is facilitated. Realizing this potential is however ambitious and demands solutions to challenges beyond addressing tariff reduction and regulatory harmonization specifications of the agreement. The lack of a comprehensive and easily accessible platform to showcase and connect African products and services is a significant hurdle. Traditional approaches to trade promotions such as exhibitions often fall short of reaching the entire continent which stifles growth in opportunities and especially for small and medium-sized enterprises. Thus, the importance of the trade information portal in enhancing the visibility of Africa’s unique offerings cannot be downplayed.

A Smart Portal for Africa: Implications on trade

The trade information portal to be developed between the AfCFTA and Nigeria’s Zenith Bank will serve as a critical digital marketplace for Africa serving as a bridge between distributors, suppliers, producers, and consumers across the continent. This function would allow the continent to harness the power of technology and showcase the rich mix of African goods and services essentially transcending geographical boundaries and time zones. Notably, the portal will empower African entrepreneurs to overcome barriers to distance and access by providing a platform for businesses to present their offerings in a more visually engaging and user-friendly manner. This will allow Africa, under the AfCFTA agreement to tap into previously untapped markets and consumer bases.

Memorandum of Understanding (MoU) signing by Dr. Ebenezer Onyeagwu, the Group CEO of Zenith Bank, and Wamkele Mene, the Secretary-General of the AfCFTA at the 2023 Zenith Bank International Trade Seminar in Lagos n 9th August 2023.

The smart aspects emphasized in the memorandum of Understanding (MOU) between Zenith Bank and the AfCFTA secretariat ought to focus on enhancing seamless transactions. Cumbersome and inefficient cross-border trade in Africa has often resulted from highly fragmented payment systems, logistical networks, and regulatory procedures. The proposed trade information porta could therefore integrate digital payment systems and solutions, offer real-time tracking of shipments, and provide a repository of regulatory information towards streamlining the entire trade process in Africa. A digitalized approach to trade under one portal would not only reduce transaction costs on cross-border trade but also enhance transparency, minimize delays, and promote trust among trading partners.

In the context of the AfCFTA, where the potential for synergies and partnerships across diverse regions is immense, the establishment of such a framework becomes critical. The African economic context is a tapestry of a rich diversity of resources, skills, and cultures. The portal could therefore serve as a digital meeting point in fostering collaboration that leverages the unique strengths of member states for mutual benefits. Whether it’s a manufacturer in West Africa seeking raw materials from the East or a service provider in Southern Africa looking to expand its reach to the North, the trade information portal could enhance easy connection and catalyze accelerated cross-pollination of ideas, innovation, and expertise to the benefit of the continent.

“It [the trade information portal] is therefore imperative for the growth of intra-African trade and is not merely just an option.”

The proposed portal can further be praised for the unprecedented access it proposes to provide to market trends and information. African entrepreneurs need to rely on informed decision-making to enhance successful trade with the portal potentially serving as a trove of data, insights, and analytics. Thus, African businesses would have access to real-time market intelligence thus easily identifying opportunities and adapting to shifts in consumer preferences thus staying ahead of competition. While this is reliant on the individual capabilities of entrepreneurs, the underlined democratization of information would level the playing field allowing established businesses and burgeoning startups in making strategic choices for accelerated growth.

Critics might argue that the development and maintenance of such a comprehensive trade information portal would be a costly endeavor. However, the willingness of private players, in this case, the Zenith Bank, indicates that the potential and return on investment far outweigh the initial costs. It, therefore, suffices to underline the portal’s contribution to increased trade volumes, accelerated economic growth, and job creation as substantial boots to national and regional economies. However, collaborative efforts between the private sector, governments, stakeholders, and international bodies would enhance further development of the portal in sustainable and scalable ways.

As the AfCFTA continues to chart a new course for Africa’s economic future and prosperity, the proposed trade information portal is a timely linchpin toward a more interconnected continent. It holds the key to overcoming traditional trade barriers, fostering cross-border collaborations, and unlocking the latent potential of African businesses on the global stage. It is therefore imperative for the growth of intra-African trade and is not merely just an option. This is a bold step towards embracing the digital age, harnessing technology for the benefit of all Africans, and redefining the narrative around African commerce.

Muoki Musila is an Kenyan based economist. He is the communications and marketing associate at Liberty Sparks. These are the writer’s own opinions and do not necessarily reflect the viewpoints of Liberty Sparks. Do you want to publish in this space? Contact our editors at [email protected] for further clarification.