In hopes of inspiring nearly 1 trillion dollars worth of economic activity, African leaders will officially announce a new pact known as The Tripartite Free Trade Area (TFTA) at an upcoming summit of the African Union in South Africa. The new free trade zone will cover 26 countries in the area from Cape Town to Cairo, becoming the largest free trade zone on the continent. Three current trade blocs within Africa are to merge as one, the Southern African Development Community (SADC), the East African Community (EAC), and the Common Market for Eastern and Southern Africa (COMESA).
Recently, Africa has seen large economic growth, and taking a step to unite the countries and establish a large free trade zone will hopefully boost this growth continent-wide. More than half of Africa's current GDP comes from trade between local countries, and the expectation is that with the free trade zone, movement of goods between countries will be simplified and will draw more business investment to the area.
A link of the economies in Africa has many hopeful, from financial investors to freedom fighters. Many are seeing the promise that Africa has in store, and there will be a large pull for international businesses once products can be produced more cost-effectively in Africa under the new free trade zone. The anticipated date for the pact to begin is 2017, but before then, there will be a long road for the countries in Africa to unite and become a single zone. Make sure to stay up-to-date on this matter and other happenings in international business by staying tuned in to the globalEDGE blog.