Harare – The African Continental Free Trade Area (AfCFTA) Secretariat, Africa Investor, and the United Nations Development Programme (UNDP) have called on countries to support small businesses to boost socio-economic recovery from the COVID-19 pandemic.
A model developed by the three organisations, in partnership with Cariolis Technologies, shows that Africa can add US$500 billion to business revenue, and create over 260,000 more jobs by 2025 via transformative action in access to finance, business environment, infrastructure, before-the-border charges (export, import documents and procedures), and the border costs.
Regulation as a Stimulus Economic Model (Raas) was launched at a high-level event at the 76th UN General Assembly in late September.
RaaS facilitates inclusion and tackles inequality in sectors where women are predominant, such as food, soft commodities, and textiles.
“The RaaS research shows how streamlining regulation can support implementation of the AfCFTA Agreement and potentially create savings for businesses on costs, generate stimulus, and support governments in creating favorable market conditions,” said Mr Wamkele Mene, AfCFTA Secretary-General. “Frameworks and support structures that enhance cross-border trade and reduce costs create platforms for ease of movement of professionals, enabling labour mobility across the region.”
AfCFTA Champion and former President of Niger, Mr Issoufou Mahamadou, delivered a goodwill message in which he said the model gave African leaders a credible and practical stimulus solution and post-COVID-19 recovery tool.
“It is an accelerator that will speed up implementation of the AfCFTA and aims at mobilising African Leaders towards bold and impactful action in the spheres of trade facilitation and regional integration,” he added.
UNDP Director for Africa Ms Ahunna Eziakonwa weighed in saying: “The model’s capacity to put money directly into the hands of people by reducing costs linked to meeting export trade requirements, increases the capabilities of individuals to maintain incomes and employment through savings in better trade environments, while paying attention to women specific concerns.
“Regulation as a Stimulus is a unique and timely model for African governments to create policy and structural enablers that will aid the revival and transformation of economies post-COVID-19.”
Mr Hubert Danso, CEO of Africa Investor said the model could generate an enabling environment to support sustainable growth of trade and trade-related infrastructure investment.
“Financial regulatory frameworks such as regional agreements can widen access to innovative financing and enable cross-border financial flows. At the same time, national-level regulations could harness accountancy systems and self-assessment, increasing intra-African trade by US$35.8 billion by 2025 with an estimated annual growth of 14 percent,” he said.
The model will be taken on a roadshow across the continent through the Africa Union and regional economic communities.