The African Continental Free Trade Area (AfCFTA) agreement promises to break cross-border trade barriers to ensure productive economic activities among member African countries. It specifically aims to create a single continental market for goods and services, with free movement of business people and investments; thus paving the way for accelerating the establishment of a continental Customs union.
Member countries were initially required to remove tariffs from 90 per cent of goods to allow free access to commodities and services across the continent.
The agreement was reached in the Rwandan capital, Kigali in March 2018. Kenya, Ghana and Rwanda were first to sign and ratify the agreement which requires 22 ratifications by members for it to come into effect.
“If this is implemented and the entire supporting environment is enabled and Sierra Leone becomes very prosperous in this area, there is going to be millions of new jobs created. That’s a lot of payroll taxes, new sectors are going to emerge, that’s a lot of manufacturing sector and corporate taxes,” the IMF representative said.
She added: “At the end of the day, even if there is going to be a loss in revenue from import duty, the new revenue coming in from a more diversified economy will completely offset that loss.”
Ms. Masha was speaking in a recent radio interview in the context of the sub-Saharan economic outlook.
The Sierra Leone Government, she said, should not be afraid to ratify the treaty as it will not disturb local investment, contrary to many fears.