Africa is the world’s second largest and second most-populous continent with a population more than 1.25 billion. Today, Africa comprises of 54 sovereign countries, most of which have borders that were drawn during the era of European colonialism.
As from March 2018, a new Global Trade player, AfCFTA (African Continental Free Trade Area) has positioned itself on the African continent by establishing its framework. This association will be one of the world’s largest existing free-trade areas in terms of the number of countries. One of its main objective is to boost African economies by harmonising trade liberalisation across sub regions and at the continental level. Under the umbrella of AfCFTA, countries have committed to remove tariffs (tax imports and exports) on 90 percent of goods. According to the U.N. Economic Commission on Africa, intra-African trade is likely to increase by 52.3 percent under this agreement and will double upon the further removal of non-tariff barriers in the next 5 years.
Mauritius have signed several trade agreements to have preferential access to key markets such as U.S, EU, India and Sub-Saharan Africa amongst others prior to AfCFTA. The main access existing to Africa were through COMESA (Common Market for Eastern and Southern Africa) and SADC (South African Development Community).
COMESA began its journey in December 1994 with the initial purpose of replacing the former Preferential Trade Area (PTA) which had existed from the earlier days of 1981. Members of COMESA are offered a wide range of benefits by the establishment of a wider, harmonised and more competitive market in order to attain a greater industrial productivity.
Its emphasis is on achieving trade promotion and hence, provides assistance by allowing the members to benefit from trade liberalisation and customs co-operation, which includes introducing a unified computerised Customs network across the region.
Since its inception in 1980 SADC has formulated policies and strategies for Regional Integration in order to support economic growth and development. The economic benefits expected from Regional Integration include increased market size, improved intra-regional trade and investment flows, and increased transfer of technology and experience.
The African platform is playing a vital role on the business, trade as well as financial sector of not only African countries but also business from East and West part of the globe. The fiscal regime as well as profit margin is attracting more interest and making Africa an attractive playground for investors.