The world is just about to get a free trade area that’s bigger, by population, than either the European Union or NAFTA.
It’s got nothing to do with the much-publicised Trans-Pacific Partnership (TPP) Transatlantic Trade and Investment Partnership (TTIP). In fact, you’ve probably never heard of it.
It’s actually the Tripartite Free Trade Area, a deal that will wrap together 26 African nations with a population north of 600 million.
Much of west Africa isn’t covered, but the deal means a huge stripe of southern and eastern Africa will be.
According to the Brookings Institution, it’ll cover 58% of Africa’s economic activity and over $1 trillion (£651.1 billion) in GDP.
Here’s how it’ll look:
The South African Development Community (SADC) in yellow, the Common Market for Eastern and Southern Africa (COMESA) in different shades of green and the East African Community (EAC) in the light brown (the only country in the EAC that isn’t also a member of COMESA is Tanzania).
That map is from 2009 so doesn’t include South Sudan.
In a recent note, Capital Economics named Africa as one of the world’s few potential bright spots as far as boosting global trade is concerned:
Over a longer time horizon, sub-Saharan Africa could also play a much larger role in world trade… If sub-Saharan Africa can sustain the pace of GDP growth seen over the past ten years, its share of the world economy could more than double over this time. While this would not be as dramatic as China’s rise over the past 35 years, it does still imply that Africa’s share of world trade will rise substantially from where it is today.
Given the development levels and divergence of the countries involved, progress is likely to be slow — but the Tripartite Free Trade Area would be a big step in the right direction.
Source: Mike Bird, The Insider