The successful implementation of the African Continental Free Trade Area (AfCFTA) is expected to lead to diversification of exports and increased productive capacity.
This is according to the Director of African Union and Africa Multilateral Economic Relations at the Department of Trade, Industry and Competition (dtic), Claudia Furriel.
Furriel was unpacking the AfCFTA Agreement at a webinar hosted by the dtic intended to engage the chemicals, cosmetics, plastics, and pharmaceutical sectors, as well as industry agencies, associations, and export councils including their members, on the benefits of exporting under the AfCFTA.
“The successful implementation of AfCFTA is expected to lead to diversification of exports, increased productive capacity, acceleration of growth, increased investment, increased employment opportunities and incomes and most importantly broaden economic inclusion,” Furrel said.
“According to the World Bank, the AfCFTA will boost regional income by 7% or $450 billion, speed up wage growth for women, and lift 30 million people out of extreme poverty by 2035,” she said.
While outlining steps to address challenges that are facing the successful implementation of the AfCFTA, Furriel emphasised that an investment-led trade approach was key.
She said trade integration and liberalisation must be accompanied by programmes to support African industrialisation, regional value chains and infrastructure development.
She added that continued engagement with the Southern African Customs Union (SACU) and other AfCFTA members on rules of origin that will support Africa’s industrialisation objectives is vital to the successful implementation of the AfCFTA.
The Scientific Director at L’oreal South Africa, Dershana Jackison, described the AfCFTA as a key business, regulatory and policy instrument that will shape the cosmetic market of the future.
She urged industry players and trade associations to actively participate in its implementation and for government to ensure that the cosmetic sector is prioritised.
Jackison noted that standards harmonisation and technical regulatory convergence for the continent were important as they would dictate market control and access to currently untapped African markets.
But for this to happen, she said the industry players through trade associations and government must influence and contribute to the direction they take.
“It is estimated that the AfCFTA has a potential to boost intra-Africa trade by 52.3% by eliminating import duties and to double this trade if non-tariff barriers are reduced. Access to African markets through the AfCFTA is expected to expand the size of Africa’s economy to US$29 trillion by 2050. This offers huge opportunities for the cosmetic sector,” Jackison said.
According to the Senior Manager of Analytical and Material Sciences at the National Metrology Institute of South Africa (NMISA), Dr Maria Fernandes-Whaley, NMISA's efforts in the essential oils industry offer tangible benefits to South African businesses in the chemicals, cosmetics and related sectors, aligning with the AfCFTA's goals of enhancing intra-African trade and economic growth.
“The recent launch of the first accredited testing service for essential oils in Southern Africa by NMISA holds tremendous promise for not only the essential oils industry but also for various sectors, including chemicals and cosmetics, under the AfCFTA,” Fernandes-Whaley said.
Fernandes-Whaley said NMISA's accreditation to the international standard ISO/IEC 17025 carries significant implications for South African industries, particularly those in the chemicals and cosmetics sectors.
She said one of the key advantages offered by NMISA's accredited testing service is the international recognition of test reports and certificates of analysis for essential oils.
“This recognition eliminates the need for further testing when South African companies export their products, which can be a cumbersome and costly process. As a result, producers in Southern Africa, including those in the cosmetics sector, will gain a competitive edge by enhancing the credibility and quality assurance of their products on the international market,” Dr Fernandes-Whaley said.
The dtic has embarked on provincial awareness workshops which provided a platform for information sharing with the private sector on the benefits offered under the agreement.
The workshops were also used to also identify South African companies in various provinces in the targeted sector masterplans and other priority sectors that have the capacity to export to the rest of the continent.
More workshops focusing on different sectors are being organized, the department said. – SAnews.gov.za
