Expanding the United States-Africa Trade and Investment Relationship

On   October  9, 2020, the Meridian Corporate Council, in partnership with Abbott Laboratories, hosted a Global Business Briefing with  The Honorable Jessica Lapenn, Ambassador of United States to the African Union (AU) and His Excellency Albert Muchanga, Commissioner for Trade and Industry of the African Union Commission. The discussion centered on the recent establishment of the AfCFTA and priorities for the expansion of U.S.-Africa trade and investment. 

Ambassador Lapenn, a career member of the foreign service, assumed her post as U.S. Ambassador to the AU and the U.S. Permanent Representative to the United Nations Economic Commission for Africa on August 27, 2019. Commissioner Muchanga, elected to the AU in 2017, spearheads the African Union’s efforts to drive the negotiations, conclusion and ratification of the Agreement Establishing the African Continental Free Trade Area (AfCFTA). 

The free trade agreement is expected to connect 1.3 billion Africans across the 55 member states of the African Union, with a combined GDP of over 3 trillion dollars. The World Bank estimates that once implemented fully, the AfCFTA has the potential to boost regional income by $450 million and bring 30 million people out of extreme poverty.  

Meridian and its Corporate Council had the opportunity to learn  about  next steps in the operationalization of the agreement, in which Commissioner Muchanga explained that the January start date would focus on five priority sectors: financial services, transport, communication, business services, and tourism. 

Ambassador Lapenn and Commissioner Muchanga both noted that trading under AfCFTA, which was originally planned for July, has since been delayed to January 2021 due to the COVID-19 pandemic. Despite the challenge of virtual negotiations, 30 member states have ratified the agreement, and more are expected to adopt the agreement.  

Regarding the future of U.S.-Africa economic relations, Ambassador Lapenn remarked “the AfCFTA is really part of a broader effort at continental integration,” and will ultimately enable increased engagement with U.S. businesses in the continent.  

“The African Continental Free Trade Area is here to stay. We’ll be looking at key statistics on the annual growth of intra-Africa trade and also the growth of the Africa’s share of global trade.” Commissioner Muchanga remarked.