New Free Trade Area Will Be Key to Recovery and Growth

Political tensions and economic stresses exacerbated by lockdowns will continue to drive migration trends across Africa in 2021. Conflict in Ethiopia’s Tigray region saw more than 40,000 refugees arrive in the Sudan, Eritrea, and Somalia, creating long-term negative consequences for Africa and southern Europe. On the other hand, there are silver linings.

Although 2020 ended with the outgoing administration of US President Donald Trump issuing a new, temporary rule requiring tourist and business travelers from 24 countries — most in Africa — to pay a bond of up to USD 15,000 to visit the US, 2021 commences with some positive developments in global mobility for Africans. US president-elect Joe Biden has vowed to rescind Trump’s travel bans on travelers from 13 countries, most of them either majority- Muslim or African nations.

Travel restrictions are mostly being lifted across the continent, and this combined with the first approval and planned deployment of Covid-19 vaccines bodes well for the implementation of the African Continental Free Trade Area (AfCFTA) in 2021 after the pandemic delayed the planned launch in July last year. AfCFTA aims to bring together 1.3 billion people in a USD 3.4 trillion economic bloc, creating a single market for goods and services in addition to a customs union with free movement of both capital and business travelers.

AfCFTA aims to bring together 1.3 billion people in a USD 3.4 trillion economic bloc, creating a single market for goods and services in addition to a customs union with free movement of both capital and business travelers.

The roll-out of the new African Union passport is also set to take place in 2021. Also stalled by the pandemic, this initiative is crucial for AfCFTA’s success as it will ease travel within the continent. So far, only government leaders, diplomats, and AU officials have been issued with the passport.

Struggling economies, high crime rates, and political instability in many parts of the continent will continue to drive wealthy individuals to invest in second passports that will allow them greater mobility to conduct business more effectively across the globe. For example, reports indicate that an estimated 4,000 South African high-net-worth individuals have left the country over the past 10 years, a trend that is being increasingly replicated across the continent.

References

Arubu, Harrison. “World Bank Economist Urges Full Rollout of AU Passport.” P.M. News, PMNewsNigeria, October 13, 2020.

Ivudria, Godfrey. “The African Continental Free Trade Area (AFCTA), Intra-African Trade and Industrialization.” EABW Digital, EABWNews, November 19, 2020.

The Economist. “Wealthy Africans Are Shopping for Foreign Passports”. The Economist, June 25, 2020.