A single, unified market will stimulate the economy of the continent

For decades, African leaders have toyed with the idea of bringing their fragmented economies together through an integrated market. At the recently concluded African Union summit in Addis Ababa, Ethiopia, President Muhammadu Buhari renewed the hope by canvassing for the speedy establishment of a single and unified market on the continent. While presenting Nigeria’s position on Niger President Mahamadou Issoufou’s report on the establishment of a continental free trade area (CFTA) and related issues, Buhari argued that a single market would provide Africa with tremendous opportunity to achieve significant growth.

The primary objective, according to Buhari, was essentially for trade in goods and services on the continent. “A single, unified market would lead to a comprehensive and mutually beneficial trade agreement amongst African Union member states. If we integrate Africa’s market for trade in goods and services, we will not only double intra-African trade, but also negotiate with other regions or continents on trade matters.  If we increase our trade, we grow faster, create more jobs and reduce poverty,” Buhari said.

To the extent that trade is a catalyst to economic development, a single market which enables free movement of goods and services within the 55 countries will boost the economy of the continent that increasingly lags behind others as it has the least percentage of intra-regional trade. Its inability to interconnect and pull resources together has cost it much in development and influence. Meanwhile, the United Nations Economic Commission for Africa reckons that the CFTA could increase trade between African countries by as much as $35 billion, an increase of more than 50 per cent from the current levels.

However, African leaders had repeatedly made a compelling case for strengthening economic ties through the creation of a common market without success. They tried to reduce the thickness of their artificial borders and exploit the economies of scale, all in a bid to speed up the development of the continent and to curtail the deep-seated challenges of poverty. The Lagos Plan of Action which was adopted more than three decades ago set out with the ambitious target of integrating Africa’s market by the year 2000. The apparent failure of that plan gave rise to the Abuja Treaty of 1991, aimed also at the creation of a common African market, but which ironically is getting little or no attention by way of implementation. Africa’s first generation of leaders, and indeed, up till now, dragged their feet and could not summon the political will to enforce treaties and measures that would lead to the prosperity of their people.  Many of them were more interested in pinching funds from the commonwealth.

But can Africa’s current crop of leaders make a difference? Are they genuinely committed to Africa’s development? Will they be able to put their house in order and take on the larger issues of sustainable economic reforms on the continent? Last week, the African Union took a bold step by launching the Single African Air Transport Market (SAATM) to free their skies. Paul Kagame, Rwandan President and the new chair of the African Union, said the SAATM was aimed at transforming intra-African air travel, liberalise civil aviation within the continent and boost economic integration and lower prices. Travelling by air from one African country to another could be strenuous, expensive and time-wasting due to poor connectivity and protectionist policies. It is therefore little wonder that non-African airlines currently control about 80 per cent of the air transport traffic to and from Africa. Liberalisation of air transport within Africa would result in substantial benefits to passengers, airlines, and the economies of the respective African countries.

But will this fly? If it does, it will be good news for everyone on the continent.