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23 March, 2018

44 African nations sign free trade area agreement to boost intra-continental trade

It is expected to be implemented in 18 months and would be the world's largest free trade zone in terms of the participating countries.

Forty-four African countries signed a free trade agreement Wednesday to boost intra-continental trade.

Known as the African Continental Free Trade Area, or CFTA, the agreement was signed at an African Union (AU) summit in the Rwandan capital Kigali, as part of the 10th Extraordinary Session of the Assembly. 

 Image result for CFTA

It is expected to be implemented in 18 months and would create the world's largest free trade zone based on the number of participating countries.

"Our peoples, our business community and our youth, in particular, cannot wait any longer to see the lifting of the barriers that divide our continent, hinder its economic takeoff and perpetuate misery," said, AU Commission Chairman Moussa Faki Mahamat, according to Deutsche Welle News.

Nigeria excused itself from the pan Africa trade deal, citing threats of strikes from the national trade unions.

African Union, AU Trade Commissioner Albert Muchanga told Reuters, "They are still doing national-level consultations and so when they finish they will be able to come on board."

Trade within the African continent, between the AU members, stands at a relatively low 15 percent of the bloc's total commerce, and continent's enduring poverty has also been attributed to the lack of commercial transactions.

According to the AU, the average tariffs across the continent stand at 6.1 percent. The bloc affirmed the African businesses suffer because of the high taxes when they export to other African countries, more than when they ship to countries outside of the continent.

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