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Africa Free Trade Agreement And China

In most African countries, most of their trade is with countries and regions outside Africa. As a result, the majority of African goods leave the continent while the countries were. This hinders the economic growth of many African countries and is the reason why AfCFTA is being developed to stimulate the movement of goods and capital in Africa. If AfCFTA is implemented with careful consideration, it will play a central role in Africa`s development. Therefore, any African government interested in signing a free trade agreement with China should consider whether or not the terms of the free trade agreement strengthen the AfCFTA. China`s overall commitment to Africa in recent years has been quite intense. Chinese companies, in partnership with competent African governments, have invested heavily across the African continent in creating a series of free trade zones and special economic zones. In terms of the impact on trade, intra-regional trade (within regional economic communities) is boosted by 14.6%, while intra-African trade would increase by about 107%. In addition, the implementation of the TFA would further increase intra-African trade by 51%. Those are important numbers. However, afCFTA is not only an agreement for the benefit of the Chinese, although the structuring and timing of the agreement have all the characteristics of Chinese organizational capabilities.

International companies around the world can benefit from the creation of an African subsidiary. This year marks the 20th anniversary of the Forum for China-Africa Cooperation (FOCAC). Over the past two decades, through close cooperation, China and Africa have unleashed growth potential, strengthened cooperation, met various challenges and implemented important agreements. In addition, it should be noted that there is an ASEAN influence in the mix. The ASEAN bloc – Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam – is quite close. From Durban, South Africa`s largest port to Singapore, the logistics zone takes 14 days or a 13-hour flight. China has a free trade agreement with ASEAN, which means SACU companies can use it. He said weak infrastructure between African countries was mainly responsible for the low level of inter-African trade and added that China supported African countries through the Belt and Road Initiative (BIS). There are other aspects of free trade that need to be cleaned up. China grants tariff concessions to least developed countries (LDCs) under the WTO and grants duty-free access to 97% of tariffs on products exported to China, whether or not these countries have diplomatic relations with China. Among the SACU nations is Lesotho, in addition to 20 other African nations.

China will therefore have to cooperate with both Lesotho and the WTO to promote a SACU free trade agreement that includes an LDC nation. China and Africa have enormous potential for cooperation, as comparative advantages and levels of industrialization are different. China`s trade with Africa increased from $10 billion in 2000 to about $207 billion in 2019, under the FOCAC and the Belt and Road Initiative (BIS). More than 3,700 Chinese companies have invested across Africa and launched businesses, which is a powerful driver of sustainable regional economic growth. Chinese companies have developed a large number of agro-technological techniques and technologies and have financing to develop in Mauricie. This will not only allow Mauritius to increase and diversify its exports to China and the rest of the world, but it will also improve product quality to meet changing consumer demands and challenge legislation on food and agriculture trade.