HomeNewsVideos

World Bank: African trade pact could boost regional income by US$450 billion

28 July 2020 11:47

WASHINGTON - The African Continental Free Trade Area (AfCFTA) provides a major opportunity for countries in the continent to drive growth, reduce poverty, and expand economic inclusion, a new report by the World Bank Group finds.

According to the report, if implemented fully the trade pact could boost regional income by 7% or US$450 billion, accelerate wage growth for women, and lift 30 million people out of extreme poverty by 2035.

“The report suggests that achieving these gains will be particularly important given the economic damage caused by the coronavirus (COVID-19) pandemic, which is expected to cause up to US$79 billion in output losses in Africa in 2020,” the World Bank wrote in an official statement received by IDNFinancials.com, Monday (27/7).

The report also finds that most of AfCFTA’s income gains are likely to come from measures that simplify bureaucracy and custom procedures. Tariff liberalisation, along with a reduction in non-tariff barriers such as quotas and rules of origin, would increase income by 2.4% or around US$153 billion.

“The remainder—U$292 billion—would come from trade-facilitation measures that reduce red tape, lower compliance costs for businesses engaged in trade, and make it easier for African businesses to integrate into global supply chains,” said the World Bank. (MS)

© 2024 - IDN Financials - All Rights Reserved.