History was made on Wednesday when South Africa sent two ships loaded with goods to Kenya and Ghana, giving local businesses the opportunity to market their products to potentially 1.3 billion people as part of the African Continental Free Trade Area (AfCFTA) agreement.
President Cyril Ramaphosa, speaking at the launch of the agreement on Wednesday at Pier 1, Port of Durban, described joining the continental trade organisation as a tectonic shift for South African business.
The country joins 30 other African states to enable trade to begin in thousands of product lines, ranging from food and beverages to steel products and equipment, taxis, pharmaceutical and personal care products, chemical products and household goods such as fridges and televisions.
Ramaphosa said Africa had a sad history as it was a continent that was exploited for centuries through slavery, with slaves “sweating and even dying on sugar plantations”.
“The very same products that were once used to enslave us are the products which we will be trading among ourselves. The shipments we are making today demonstrate that AfCFTA has become a reality and is fulfilling the dream of an even stronger and larger Africa.”
He said that Transnet was facing severe challenges but government was working together with industry to address these.
“African countries have traded with each other in the past but there has been limited trade among ourselves. We have been exporting raw minerals on an unprocessed basis and selling these to the world, instead of harnessing the oil and raw materials to industrialise our continent,” Ramaphosa said.
He said it was important for the raw materials to be turned into finished goods and then sold.
Ramaphosa said trade ministers from AfCFTA countries must be bolder in trading with other African countries, and ensure that products must be manufactured on the continent.
“This is the only way to grow our economies faster and more sustainably.
Look at China, who grew their economy by consuming their own goods, we should be doing the same here.”
He said South African automotive companies had already started this process by sourcing leather from Lesotho, wiring from Botswana and steering wheel components from Tunisia.
“Industrial development is core to Africa’s integration.”
Trade and industry Minister Ebrahim Patel said it was historic that the vessel Navios Verde (meaning ‘Green Ship’) would take the first container of South African products to Ghana.
“Trade is about the flow of goods, of human technology and human labour in the form of assets moving from one place to another.”
He said for South African companies there was potential to expand their portfolios through the agreement and exponential trade opportunities that incorporate women on the continent.
Patel said women in the Agri-business informal sector now have the opportunity to move their goods to the rest of the continent.
AfCFTA secretary-general, Wamkele Mene, said it was hoped that the value of the trade agreements on the continent would reach $16.5 trillion (about R307 trillion) by 2050.
“South Africa’s pharmaceutical sector contributed $4.6 billion to its GDP in 2021 and the opportunity for growth will not only help the economy but is also good for Africa’s public health.
“This is a milestone for economic integrity and an opportunity to build robust supply chains, while providing wider access for export,” Mene said.
The Mercury