African CEOs demand a fairer, more transparent global trading system
65 per cent of the CEOs said the global trading system is unfair to Africa.
Findings from a new survey commissioned by the Pan-African Private Sector Trade and Investment Committee (PAFTRAC) highlight the desire of the African private sector for reforms aimed at making global trade rules fairer and more transparent. Results of the survey were presented on Thursday at a webinar hosted by the African Export-Import Bank (Afreximbank).
PAFTRAC is a platform that was formed in 2018 to bring together the African private sector and African policymakers to drive advocacy and policy actions on intra-African trade and investment. Afreximbank was mandated to host the PAFTRAC secretariat.
According to a statement released today by PAFTRAC, 200 CEOs participated in the survey, which was conducted by African Business magazine in partnership with Afreximbank. The survey focused on the trading system and the role of the World Trade Organization (WTO) in light of the ongoing selection process for the next WTO Director-General. Three of the eight candidates are African: Nigeria’s Ngozi Okonjo-Iweala, Kenya's Amina Mohamed and Egypt's Abdel-Hamid Mamdouh.
The results of the survey show a majority of the respondents believe the WTO is not effective in fulfilling its role. Indeed, 65 per cent of the CEOs said the global trading system is unfair to Africa. They said this was a major constraint for growth in Africa.
A general consensus among the CEOs was that the current rules penalise the African continent and its private sector. The African CEOs, thus, called for a reform of the rules governing global trade with the aim to support developing countries.
“We have seen during this pandemic companies in the industrialised world have received massive bailouts, tax incentives, not to mention government contracts and fiscal stimuli,” said Pat Utomi, Chair of PAFTRAC. “Companies in Africa were not so fortunate and will have to deal with a world where trade will be depressed because of the post-Covid environment. As such, a fairer global trade environment and trading system is more urgent today than ever.”
Other key constraints to growth on the continent, according to the business leaders, are infrastructure, logistics and human capital. The CEOs, however, showed optimism about the future outlook as most of them see the multilateral system strengthening in the coming years.
Over 50 per cent of them believe global trade will increase over the next 12 months; and over 70 per cent of the business leaders said intra-African trade will also increase over the next 12 months.
PAFTRAC said the survey as well as a debate around a communiqué will be sent to all the candidates running to be the next WTO Director-General.
“We have seen, over the past quarter of a century since the WTO was formed, the emergence of a robust and dynamic African private sector, and more recently significant steps to integrate Africa under the African Continental Free Trade Agreement (AfCFTA),” said Benedict Oramah, President of Afreximbank. “The WTO and its new leadership will need to recognise the imperative of African integration and put development at the centre of any trade agenda.”
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