— The AfCFTA agreement is expected to lift 30 million Africans out of extreme poverty, boost the incomes of nearly 70 million people, and generate US$450 billion in income by 2035.
The Liberian legislature has ratified the African Continental Free Trade Area (AfCFTA), which aims to create one of the largest free trade zones in the world since the World Trade Organization was created in 1995.
The move by the 54th legislature, which now paves the way for the President’s signature, comes at a time when Liberia is yet to fully domesticate the agreement — being the only country in Africa not to have done so — since AfCFTA entered into force on May 30, 2019.
The AfCFTA, which aims to eliminate trade barriers and boost intra-Africa trade, would greatly benefit the country as it opens up a vast continental market for Liberian products — forcing the country directly to diversify its export base and reduce its dependence on traditional trading partners.
It also presents Liberia with a unique opportunity to improve its infrastructure and logistical capabilities. With smoother cross-border trade, the demand for efficient transportation, ports, and customs procedures will rise as AfCFTA’s goal is also to advance trade in value-added production across all service sectors of the African Economy.
The AfCFTA is one of the African Union’s long-term development strategies geared toward transforming the continent into a global powerhouse. The agreement which has been domesticated by 44 African countries, is expected to contribute to the establishment of regional value chains in Africa, enabling investment and job creation.
Under the agreement, AfCFTA members are committed to eliminating tariffs on most goods and services for 5, 10, or 13 years, depending on the country's level of development or the nature of the products.
General long-term objectives include creating a single, liberalized market; reducing barriers to capital and labor to facilitate investment; developing regional infrastructure; and establishing a continental customs union.
A report by the World Bank anticipates that AfCFTA could lift 30 million Africans out of extreme poverty, boost the incomes of nearly 70 million people, and generate $450 billion in income by 2035.
On January 13, 2022, the AfCFTA took a major step towards its objective with the establishment of the Pan-African Payment and Settlement System (PAPSS), which allows payments among companies operating in Africa to be done in any local currency.
Meanwhile, the 54th Legislature decision comes nearly two weeks after President George Weah, who is nearing his first six-year tenure, submitted a request for ratification five years after the agreement was signed in Ethiopia at an African Union summit.