FNB: Why we are bullish on the AfCFTA

FNB, one of Africa's leading banks, has expressed optimism regarding the Africa Continental Free Trade Area (AfCFTA), which is set to become the largest free trade area agreement in the world. The AfCFTA holds massive opportunities for the African continent, although there is still much work to be done to fully realize its potential. Bobby Matav, the Head of Trade at FNB, shed light on the bank's bullish view on the deal during a recent interview with CNBC Africa. Matav emphasized the importance of understanding the sectoral agreement and highlighted the significance of bringing 54 African countries together to foster trade within the continent. He pointed out that currently, only 17% of Africa's trade is conducted among African countries, in stark contrast to Europe and Asia, where intra-regional trade accounts for a much larger share. Matav underscored the vast potential for growth and collaboration within Africa, citing pockets of excellence and opportunities for mutual learning between countries as key drivers for economic advancement. While some international corporations have expressed reservations about the AfCFTA, with reports of exits from the continent, Matav remains confident in the agreement's ability to boost intra-African trade and elevate the continent's economic landscape. Despite initial hesitance from some corporate entities, FNB has observed early signs of interest from companies seeking support in trade facilitation and financing to enhance their business operations across Africa. Matav acknowledged that it is still early days for the implementation of the AfCFTA and highlighted the importance of disseminating information about the agreement to encourage more companies to participate. He emphasized the role of platforms like the AfCFTA website in simplifying the enrollment process for businesses and enabling them to be part of the larger trade ecosystem. Furthermore, the AfCFTA is expected to attract foreign direct investment (FDI) to Africa, prompting inquiries from international companies looking to expand their presence on the continent. Matav noted that foreign companies are exploring opportunities to leverage the AfCFTA for their exports and operations within Africa. With 54 countries signatory to the agreement, the AfCFTA offers a platform for businesses to penetrate new markets and capitalize on the continent's growing demand for goods and services. As Africa strives to increase intra-regional trade and attract investment through the AfCFTA, FNB remains committed to supporting its clients and fostering economic growth within the region.