By Spy Uganda
Small and Medium Enterprises have been urged to embrace African Continental Free Trade Area programmes to expand their export business in post covid 19 pandemic times.
Executive Director of Federation of Small and Medium Enterprises (FSME) John Walugembe says the ACFTA has been touted as a game-changer for economies like Uganda, as it promises larger market opportunities, triggering more trade and investment and allowing greater value addition, export diversification and productivity growth – leading to more and better jobs with greater social inclusion.
WWalugembe was closing awareness and trade readiness programme sessions for 300 SMEs at Uganda Manufacturers Association under the theme: Trading Beyond EAC and COMESA. Unlocking the potential of ACFTA in Uganda.
“African Continental Free Trade Area is an ambitious trade pact to form the world’s largest free trade area by connecting almost 1.3bn people across 54 African countries. The agreement aims to create a single market for goods and services to deepen the economic integration of Africa,” he said.
“The AfCFTA aims at accelerating intra-African trade and boosting Africa’s trading position in the global market by strengthening Africa’s common voice and policy space in global trade negotiations,” Walugembe added.
The AfCFTA is projected to raise Africa’s income by 7 per cent, lift 30 million people out of extreme poverty, and lift 68 million people out of moderate poverty by 2035. It is also projected to boost intra-African trade by 52.3 per cent when import duties and non-tariff barriers are eliminated. Though, there are several challenges and opportunities that Uganda needs to address to harness the potential of the AfCFTA.
The AfCFTA also promises higher intra-regional trade in agri-food products, including from surplus to deficit countries, thereby stabilising food prices and improving food security in Africa. It offers an opportunity to promote socioeconomic transformation and improve competitiveness through regional value chains in manufacturing while improving competitiveness, triggering greater trade and investment in green enterprises, and promoting socio-economic transformation.
Presidential Advisor on trade and industry Amelia Kyambadde underscored the role of the private sector in spearheading “our effort to take advantage of the opportunities in the AfCFTA.”
The Minister described the AfCFTA as one of the drivers of Africa’s growth and industrialisation agenda. “With a population of 1.3 billion people and a combined GDP of US$3.4 trillion, the AfCFTA offers the continent, and Uganda, a solid base for a speedy industrialization,” she said.
Amelia noted that implementation of the AfCFTA is timely, especially in light of the economic challenges exacerbated by the COVID-19 pandemic, which has adversely impacted global economic growth projections.
“The African Continental Free Trade Area provides us an opportunity to further consolidate our resilience and should catalyse our recovery from the impact of COVID-19,” she stressed.
Dr. Joy Kategekwa, UNDP Africa Strategic Advisor stressed the need for renewed efforts to create awareness about the AfCFTA and the opportunity it presents, a commitment to support and increase the capacity of entrepreneurs and exporters to meet quality standards needed in the market and sustain supply chains while establishing an enabling infrastructure such as roads and energy.
Elly Twineyo Executive Director of Uganda Export Promotion Board stressed the need to improve on packaging and branding to make Uganda’s exports competitive in the African market.
AfCFTA Secretary-General who made a presentation at the dialogue lauded the government of Uganda for the great strides that have been made towards the implementation of the AfCFTA.
UNDP Representative, Ashie Mukungu underscored the importance of inter-country trade and cooperation, noting; “Development experience shows that no country has ever achieved rapid economic growth and prosperity without trading with other countries.”
Mukungu said the successful implementation of AfCFTA will put Uganda at new inclusive and sustainable development path by building an industrial value chain and specialization structure based on Uganda’s comparative advantages.
Dr Joshua Mutumba Commissioner for trade said Africa accounts for just 2.9% of global trade and only about 17% of African exports are intra-continental, compared with 58% for Asia and 65% for Europe.
He advised small and medium enterprises to take advantage of ACFTA to better their businesses saying African Continental Free Trade Area is the world’s largest free trade area which provides an opportunity for countries in Africa to competitively integrate into the global economy, reduce poverty, and promote inclusion. The potential impacts at the household level are also significant.
UNDP is supporting the Ministry of Trade, Industry and Cooperatives to accelerate Uganda’s implementation of the AfCFTA, focusing on awareness-raising, enhancing market access opportunities, preparing a National AfCFTA Implementation Strategy, and establishing a catalytic Trade Finance Facility with a special focus on small and medium enterprises (SMEs).
The support is also geared towards building local and regional partnerships, both technical and financial, for ensuring a more efficient implementation of AfCFTA in Uganda.
