One of the objectives of the African Continental Free Trade Agreement (AfCFTA) is to “create a single market, deepening the economic integration of the continent” There is empirical evidence that the attainment of economic integration among a group of nations brings about a closing up of income gaps among the poor and richer nations participating in such an arrangement.

The majority of countries in Africa are classified as low-income countries and few in the middle-income group, hence, the successful implementation of the  AfCFTA could lead to convergence to higher national incomes among the participating countries. The success of the European Economic Community in attaining a convergence at a higher GDP per capita among its country members is evidence that AfCFTA could replicate similar success.

An Example of Economic integration and Income Convergence: The European Economic Community

An example of income convergence in a regional common market is the European Economic community created in 1957. The goal of attaining economic and social cohesion in the EEC is contained in Article 130a of the Single European Act of 1986 which reads “To promote its overall harmonious development the community shall develop and pursue its actions leading to the strengthening of its economic cohesion”. A Study by Cinzia Alcidi- Director Center for European Policy Studies- reveals that there has been commendable income convergence at higher income per capita among the EEC member countries. For instance, member countries from Central Eastern Europe such as Romania, Estonia, Latvia, and Slovakia witnessed income growths of up to 30% and 40%  in 2000 (compared to their pre membership incomes). However, countries along Southern Europe such as Greece, Spain, Cyprus, and Portugal witnessed a decrease in income growth rates. While the North-western member states also grew in incomes. Overall, data reveals good economic cohesion in the EEC.

How African Nations can achieve convergence at higher income under the AfCFTA

While the  creation of a Common market in Africa presents     an opportunity for economic integration which could help the poorer countries in Africa to catch up  with the richer countries, certain structures must be built to make this objective a reality:

Reducing the barrier to the movement of goods and people

Although the AfCFTA seeks to eliminate tariffs on over 90% of traded goods with pending negotiations for trade in services, tariffs are not the only barrier to trade. There are several non-tariff barriers that include the high cost of transport of goods across Africa. Although these costs are sometimes lower for intra-regional trade where road transport is an option, they are higher for inter-regional trade. Also, the fact that not all African countries provide visa-free or visa-on-arrival access to travellers means that the movement of people is restricted. There is however a pending Protocol on the Free Movement of People by the African Union.

 Enhanced Access to Capital

Capital is needed to build the economy, by providing physical and social infrastructure which will support the creation of new businesses as well as sustaining economic activities. The African Union should be committed to providing financial support for poorer countries to develop critical infrastructure in the areas of transport and power. The presence of infrastructure will improve the chances of attaining economic integration in the continent and consequently stimulating growth among all countries.

Reduced protectionism

Protectionism may hurt the attainment of economic integration in the continent.

While protectionism may protect infant firms and preserve jobs, it prevents firms from attaining efficiencies made available only through competition. Protectionism can also encourage retaliation from other countries which could lead to economic loss to the countries involved. As such governments should support the growth of firms by providing grants and access to technical support which will enable their growth in the market.

We are in Execution Phase at Tekedia Live –  Remote Work Administration [Special Lab] by Krozu USA  |

I think it is time for Corporate Nigeria to make a comment on the state of the nation. I understand that many of us need things from the government and would not like to be misquoted. But it comes a time when a nation is under severe stress for the leaders of the private sector to speak out. In Georgia in America, sports teams and corporate America have made it clear: politicians, we are disappointed with your new voting laws. Can the bank CEOs, cement bosses, oil & gas leaders, etc tell the government to get itself in order?

Doctors on strike. Judges on strike. Polytechnics on strike. University joining. One police station off per week. This is a failing state.

Can Corporate Nigeria develop a “Contract with Nigeria” where it could articulate to hire and employ 2 million youth over two years with clear demands on what it needs from the government? We can do it by reallocating factors of production in a measurable way to bring hope to young people. It’s time – Nigeria is waiting for Corporate Nigeria as Abuja and state capitals have failed.

Looking at the fundraise from African startups, you may struggle to see a clear trajectory. It goes up and down, though towards the end of 2020 and early 2021, a muted trajectory emerged. . Yet, while everyone likes to write on fundraise, the most catalytic thing is not funding, but unleashing human capital in ecosystems. Andela might not have raised tons of money recently, but Andela’s impact is HUGE. 

How? When it released those young people, they moved into markets and started doing amazing things in companies.  And the big one: Y Combinator is not extremely outperforming when you look at the data. Sure, it has got Paystack and Flutterwave, but there are other hot startups in Africa which are doing amazingly great which did not pass through it. Its batting average looks like others. So, do not make it look like YC is the only path.

Meanwhile, I am still waiting for a paper from an Economics professor in Africa who can pick the data, and quantitatively explain how these startups have improved human welfare and broad standard of living. (PhD Econs students, a good thesis topic.) That is the real deal, besides piping dollars from America into Africa.

Something new is in the labour market: remote work manager,  remote work administrator,  director of remote work, etc. Yes, companies are opening and hiring positions to coordinate the amalgam of professionals who are now working remotely, arising out of the massive dislocation from Covid-19.

As a modern school, Tekedia Mini-MBA has introduced a special session on Remote Work Administration to show our learners what this is all about. To do that, we are bringing a global leader on remote work: Krozu.

• Thur, April 8 | 7-8pm WAT |  Remote Work Administration [Special Lab] – Krozu USA

 Among others, Krozu has an industry-leading technology designed for remote work. It is a full-level Work from home (WFH) ecosystem, supporting firms from anywhere at any time!

Krozu offers real-time synchronization of all your projects and tasks within your business regardless where each of your employees work from. Teams and the entire business gains real-time updates and notifications with collaborative tools giving them the ability to be even more productive than before. Even when employees are away from the office, projects continue to get executed, organized and completed with clear visibility in real-time.

Our vision is that this training will unlock opportunities for people to understand the mechanics of managing remote teams, unbounded and unconstrained by geography.

It is free for all Tekedia Mini-MBA members. This is part of our execution phase where we experience transformations in markets and possibly help us to go and change things at work! Zoom link in the Board.