A truck transports shipping containers at the container terminal at the Port of Durban, operated by Transnet SOC Holdings Ltd.'s Ports Authority, in Durban, South Africa, on Friday, May 25, 2018. Transnet last year reduced its seven-year capital-investment plan by 17 percent to 229.2 billion rand in response to lower-than-anticipated freight demand. Photographer: Waldo Swiegers/Bloomberg The outstanding negotiations will be finalized through a new African Virtual Trade-Diplomacy Platform that is being developed as a public-private partnership between the African Union Commission and more than 20 African multinational companies, the African Union said in a statement published on its website. The trade deal is being led by the continental body.
Set to be fully operational by 2030, it could be the world’s biggest free trade zone by area, with a potential market of 1.2 billion people and a combined gross domestic product of $2.5 trillion. Fifty-four of the 55 nations recognized by the African Union have signed to join the area -- Eritrea is the exception -- while 28 have ratified the agreement.
Africa lags other regions in terms of internal trade, with intra-continental commerce accounting for just 15% of the total, compared with 58% in Asia and more than 70% in Europe. The agreement aims to change that by lowering or eliminating cross-border tariffs on 90% of goods, facilitating the movement of capital and people, promoting investment and paving the way for a continent-wide customs union.