The Power of Economics and the Window of Opportunity to Access it

To explain the role and what I would herewith describe as the African opportunity, we need to explore the dynamics of the world economy through cultural lenses, not only national perspectives. My goal is to understand how a real and lasting economic improvement within Africa and the Caribbean can be achieved by reorganizing the existing complacent global trade relations. Note that not all trade relations are complacent; there are individual trade relationships with well-established integrity and have brought about beneficial political policies, technology advancement, and regulatory frameworks.

Great Economists know that the power of economics is underrated. Economics is by virtue the most potent stem of all social existence. Religion, politics, war, and academic pursuit, and professionalism are all adaptive virtues of interconnected roles within the economic system. Therefore, economics is the underlying framework of the symbiotic relationship system between a unit, a society, and the environment. It takes a specific mindset to understand full economic power as a principle for the natural order of unitary potential and social identities within the universal ecosystem. Suppose we understand the critical impact that the nature of people's relations has on the economy. In that case, we will understand how to use economics as a shared group identity tool with a common purpose of healing to which wealth creation is vital. Economic power is generated when the economic and financial system of a shared identity (based on the condition of being related) can adapt themselves to the global-integral world, in which economic ties cross borders and firms, in which people depend on one another and affect one another, with a conscious goal for sustainable wealth creation and the stability.

Nonetheless, to people of African descent, the reality of economic crisis has been within us. In the relationships between us, the rest of the world since the false and fictitious denigrating picture and narrative about Africans was constructed and cultivated for many years through various slavery and colonialism elements. Thus, our depiction is of a people that are economically powerless and culturally weak. At the same time, the narrative reflects distorted interconnections, manipulations, and false values. However, people have begun to understand that an economy based on lies, speculation, manipulation, and mistrust is unsustainable. In a sense, the current crisis offers us an opportunity to examine our relations' nature and change it, so it fits what is required of the global world and the necessary interdependence among its parts. Such harmony and congruence will necessarily create a different economy, optimistic, balanced, and stable. An excellent example of this positive change can be seen in the normalization of the US_-Cuba diplomatic relationship after several decades of the embargo that we know today has been unnecessarily hurtful.

Nature works in harmony and balance, and now it is up to us to change our thinking and behavior, our relationships, and as a result, our common plight, including the current weak socio-cultural, economical system to become balanced and harmonious like nature. Behavioral economics describes the nature and power of human relations, their collaborations. It shows the extent to which tendencies and fundamental perceptions of human economics rely on values of mutuality. I believe that since the distorted desire and anxiety for economic survival is what created slavery and colonization of the indigenous people, therefore the new paradigm must rise one level higher and correct the problem created by the perversion; hence the solution would be normalizing natural human relations and connections at the economic level. Suppose we understand the critical impact that the nature of people's relations has on the economy. In that case, we will understand the economic system we must build to carry out its roles effectively and maintain its stability. Yet, not only must the economic focus change, the economic and financial systems being the reflections of human relations, the entire international community (United Nations, State governments, and other authoritative economic and financial Institutions) is required to support that solution that rearranges the system of human relations. When the economic relationship between African and African Diaspora in the Caribbean and North America begins to change toward bonding, unity, social cohesion, care for others, and mutual guarantee, we will all begin to see a positive socio-cultural paradigm improving accordingly.


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African Continental Free Trade Area (AfCFTA) in collaboration with the African Union

Trading under the FTA, which was earlier billed to commence July 1 2020 but had to be postponed to January 1, 2021 due to the advent of the Covid-19 pandemic, epitomizes the manifestation of Africa’s long-held dream of continental economic integration ever since the formation of the Organisation for African Unity (OAU) in 1963. Thus, the FTA creates out of Africa’s current 55 balkanized economies, a single continental market of 1.3 billion people with a combined Gross Domestic Product (GDP) valued at US$3.4 trillion.

It would be recalled the Agreement establishing the AfCFTA was signed at the 10th Extraordinary Summit of the AU Assembly on the 21st of March 2018 in Kigali, Rwanda, and entered into force on the 30th of May 2019. The Agreement creates a single continental market for goods and services which allows for free movement of business persons and investments and will consequently expand intra-Africa trade across Africa’s Regional Economic Communities (RECs) as well as enhancing competitiveness and supporting economic transformation.

In his keynote address at the virtual launch, President Cyril Ramaphosa of the Republic of South Africa cum current chairperson of the African Union, said the fact that 54 out of 55 AU countries had signed the AfCFTA Agreement, about 33 countries had ratified it while over 40 countries had submitted their tariff offers, was a strong signal as to Africa’s readiness to start trading on the basis of the new rules and preferences that would guarantee the cherished vision of One African Market. He thus urged member states that were yet to ratify the Agreement to fast-track the FTA process so as to ensure no one was left behind.

RELATED OP-ED | Preparing for trade under the AfCFTA Agreement, By Albert Muchanga

The AU chairperson also emphasized the need for recommitment of efforts towards the AU’s overarching goal of Silencing the Guns in Africa – as effective and successful intra-Africa trading would solely depend on peace, security and co-existence between African communities. “As we look forward to ushering the AfCFTA trading, we shouldn’t forget our common commitment, ‘the silencing the guns campaign’, as we can’t have a successful trading without peace. We need to fast track all pending matters and make the Agenda 2063 a priority,” Ramaphosa urged.

In his opening remarks, Secretary General of the AfCFTA Wamkele Mene, underlined that the AfCFTA would not be just another trade agreement; instead, it would be a mechanism for Africa’s development by closing the gender pay gap, and creating the opportunity for African SMEs to access new markets. “We are working very closely with our technical partners to develop digital technology platforms that will enable connectivity of Small to Medium Enterprises, and enable connectivity of young Africans in trade. This Agreement does not benefit only the big corporations on the African continent, but it should always be inclusive of young Africans, women and African SMEs,” he said.

RELATED AfCFTA, AIDA: Africa's dual pathways to economic integration, industrial development

The AfCFTA principal said he was now convinced Africa had taken active steps to dismantle the colonial economic model it had inherited and sustained over a period of 60 years. He therefore restated the need for the continent to stop being exporter of primary products to countries of the global north and instead create jobs on the African continent, by developing its regional value chain and becoming self-sufficient through its own continental production.

“In 2020, Covid-19 has demonstrated, that Africa is overly reliant on import of primary goods, overly reliant on global supply chains, and when these global chains are disrupted, Africa suffers. When these global chains are subdued, we know that Africa suffers. So we have to take active steps to make sure this industrial development is accelerated and this African Continental Free Trade Area and the Launch of Trading today are the first steps we take into that direction,” Mene stressed.

In his address, Mr Moussa Faki Mahamat, the chairperson of the AU Commission, identified the AfCFTA as undoubtedly an opportunity to spur African industries to upscale and create new value and supply chains to increase industry efficacy on the continent, adding that the FTA would generate more employment opportunities for Africa’s burgeoning youth population.

Faki further said in order to guarantee ceaseless supply of needed commodities for the over 1 billion population of the continent, there was need to upscale the SMEs by providing conducive business environment for them to thrive, noting that the AfCFTA had provided such a conducive environment through drastic reduction of tariffs on various commodities, thereby allowing the SMEs the opportunity to access a much bigger market than they used to before.

The AU Commission chief called on African entrepreneurs, pension funds and other stakeholders to invest in the One African Market so as to spur rapid growth of the continent’s economy and its competitiveness in the global value chain. “The African Continental Free Trade Area will fundamentally change the economic fortunes of our continent. I call on the entrepreneurs of our nation to seize the abundant opportunities that this historic development will present to explore new markets and build new partnerships.”

RELATED OP-ED | COVID-19 is accelerating multilateralism in Africa, By Landry Signé and Mary Treacy

According to the African Union, Friday’s virtual Launch of Trading under the AfCFTA, held in partnership with the UN Economic Commission for Africa (UNECA), Africa Export-Import Bank (Afreximbank), and AfroChampions Initiative, was the first of a series of events that would take place virtually and physically over the coming weeks, in commemoration of this important occasion in fulfilment of the OAU founding fathers’ dream of a truly united and integrated continent.


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African Views technical, scientific, and cultural research, analysis, reports, and public engagement on Economic Programs

GREEN AFRICA: African Transition to Green Economy If African nations go the green route to growing their economies, the continent could end up as the envy of the rest of the world, says Achim Steiner, UN Under-Secretary General and UNEP Executive Director. This is because Africa is rich in the kinds of natural resources that in many parts of the world have been over-exploited and diminished by centuries of unsustainable development. Green Economy is not a substitute for sustainable development but a way of realizing it. Over the past few years, Green Economy has become relevant to developing economies and it is in developed ones: it is as central to more state-led economies as it is to more market-led ones. It is not a trend, nor is it prescriptive. The Green Economy is about shaping public policy including market mechanisms and fiscal strategies in a way that unleashes the private sector into a more meaningful notion of wealth creation. More meaningful in the sense that it country helps to achieve the aims of improved human well-being and reduced inequalities over the long term, while not exposing future generations to significant environmental risks and ecological compromises. Economists, academics, researchers, government and civil society representatives and media from Africa and other continents are saying that Africa has the largest potential for energy generation from renewable sources, but the problem is implementation. The question is can Africa take a leadership role in Green Economy by setting an example for rest of the world so they can learn from Africa? HOST: Ernest Kwabena Opong (Publisher of Amandla News) See: www.africanviews.org/av-radio