By Tobi Ayodele
The talent shows I watch often have few magicians come to showcase their skills. Some come with outstanding performances with a mixture of old and new tricks to wow the audience. And some unsuccessfully try to reinvent old tricks.
I realized what fascinated the audience including me, was not the magician but the delivery of their performances. In this article, the magic here is the African Continental Free Trade Area (AfCFTA) and the magicians are African governments, regional institutions, and development groups while the audience is African women, African women in business, and African women entrepreneurs.
The AfCFTA started trading on 1st January 2021, becoming the world’s largest free-trade area and creating a market of 1.2 billion people. World Bank in June 2020, reported that the AfCFTA presents a major opportunity for African countries to bring 30 million people out of extreme poverty and to raise the incomes of 68 million others who live on less than $5.50 per day.
The African Economic Outlook 2021[ii] identified the AfCFTA as an essential lever for African economies to ensure resilience and economic transformation in the COVID-19 aftermath.
These reports prove the outstanding performances the AfCFTA is expected to perform. The delivery however is saddled in the hands of African governments, regional institutions, and development/technical partners, and the performance must be seen by everyone including women and young entrepreneurs.
Trade Liberalization and Women’s Liberation
The AfCFTA aims at broadening and deepening intra-African trade through better harmonization and coordination of trade liberalization. Trade Liberation which is the removal or reduction of barriers on the free exchange of good between nations is a key contributor to the Pan African vision of ‘an integrated, prosperous and peaceful Africa’ enshrined in the AU’s Agenda 2063: The Africa We Want.
The AfCFTA will progressively eliminate tariffs on intra-African trade, making it easier for African businesses to trade within the continent and cater to and benefit from the growing African market.
Existing economic analysis has already demonstrated that all economic policies have a general impact on genders and a specific impact on women, and major transitions like trade liberalization are even more so.
Trade policies evidently affect women differently from men. This is due to gender inequalities in access to and control of economic and social resources, decision-making, and gendered divisions of paid and unpaid labor.
In 2017, World Trade Organization (WTO) members agreed to a Joint Declaration on Trade and Women’s Economic Empowerment, which aims to increase women’s participation in trade. Women entrepreneurs and women-owned businesses are also likely to miss out or benefit less from the opportunities brought by trade integration.
This is because they are mostly small, informal, and have low productivity. The multiple challenges from discrimination and social norms to limited capacity and access to finance have widened the inequalities. Women-led businesses and men-led businesses in Africa do not play by the same rules. An example is the USD42 billion gender credit gap that SMEs experience in Africa.
Even so, trade liberalization processes can cause disjoints within national economies as markets are opened up to free trade. Within the periods of transition or adjustments, lives, businesses, and institutions are impacted at various levels. In any sector, women’s participation will either increase or reduce as the sector either expands or shrinks through trade liberalization.
How can the magic happen?
Women entrepreneurs operate on a small and medium scale in Africa and women-owned businesses in Africa are largely small and informal. However, Informal cross-border trade is estimated to contribute to 30 to 40 percent of regional trade in Africa[v], and women account for 70 percent of it.
An outstanding performance of the AfCFTA that would wow the audience especially women in business, is dependent on the delivery by African governments, regional institutions, technical and development partners.
For women entrepreneurs and women-owned businesses to be satisfied by the performances of the AfCFTA, African governments, regional institutions, and development groups need to;
- Strengthen women’s businesses in sectors like service and agriculture that are likely to lose out in the short term of the AfCFTA agreement administration through sustainable entrepreneurship packages and policies.
- Integrate existing trade policies that prioritize women-owned businesses into the AfCFTA administration at the regional, national, and state levels.
- Create intense country-level opportunities for women entrepreneurs especially in the informal sector particularly also in service and agriculture to enable easy integration into the trade liberalization.
- Design and disseminate context-level messages and communication mediums to strengthen awareness of the AfCFTA to reach women in low-income and rural communities.
- Monitor progress and impact of women’s economic rights and participation in the AfCFTA administration for regional and national level research and analysis.
The AfCFTA is a step in the right direction for Africa as a continent. However, beyond the ratifications and high-level discussions, the realization of this policy will depend on intentional actions and the collective efforts of the African people.
Transparent policy measures and deliberate investments are needed, in particular, to ensure that women and youth, who account for the majority of the population, business owners, and workforce, can be better integrated into the value chains, jobs, and opportunities stemming from the African Continental Free Trade Area (AfCFTA).
