Africa: AfCFTA – Creating New Opportunities for China-Africa Cooperation

As trading under the Africa Continental Free Trade Agreement (AfCFTA) commenced on January 1, 2021, African countries now participate in global economic activities as a single market. According to the World Bank and the United Nations Conference on Trade and Development (UNCTAD), the implementation of the AfCFTA, by 2035, will boost the total export volume in Africa by nearly 29%, of which the intraregional volume by over 81%, bringing an increase of around 450 billion US dollars in actual benefits, and lift 30 million people out of poverty. By then, Africa will enhance its global competitiveness and attractiveness by accelerating the process of industrialization as a whole, so as to better integrate into the world economy.

At present, the world economy is undergoing profound and complex changes, with trade protectionism and anti-globalization movements on the rise. As a result, major economies adopt Free Trade Agreement (FTA) as a new platform for international cooperation. Practice suggests that the high-level FTA effectively facilitates economic and trade cooperation between countries and regions, and reduces the uncertainty in international trade and foreign investment.

A goal of “New systems for developing an open economy, Comprehensively improving the level of opening up, Promoting free trade and investment, and facilitating trade innovation and development” was set in the Fifth Plenum of the 19th Central Committee of the Communist Party of China, and the establishment of FTA is one of China’s key initiatives in opening wider to the world. By the end of 2020, China has signed 19 Free Trade Agreements, involving 26 countries and regions. In particular, China and the ASEAN countries, together with Japan, South Korea, Australia, New Zealand signed the Regional Comprehensive Economic Partnership Agreement (RCEP) on November 15, 2020, making it the world’s largest FTA, which injects new impetus to maintain multilateral trading system, deepens regional economic integration and stabilizes the global economy.

China also actively promotes free trade cooperation with African countries. On January 1, 2021, “Free Trade Agreement between the Government of the People’s Republic of China and the Government of the Republic of Mauritius”, the first FTA signed between China and an African country, came into effect. According to the agreement, China and Mauritius would realize high-level free trade arrangements, make high-quality mutual opening commitments on trade in services, and agreed to carry out economic and technological cooperation in agriculture, finance, medical care, tourism and other fields. The agreement provides a stronger institutional guarantee for strengthening economic and trade relationship between China and Mauritius, and raises China-Africa cooperation to a higher level.