Standard Chartered Commits to Supporting Clients and Businesses in Harnessing the Potential of AfCFTA

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Standard Chartered Commits to Supporting Clients and Businesses in Harnessing the Potential of AfCFTA

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Standard Chartered Commits to Supporting Clients and Businesses in Harnessing the Potential of AfCFTA

Standard Chartered Commits to Supporting Clients and Businesses in Harnessing the Potential of AfCFTA

Head, Corporate and Investment Banking at Standard Chartered Bank Ghana Plc, Xorse Godzi, has reiterated the bank’s commitment to collaborating with clients, key stakeholders and policymakers.

“With the enormous potential AfCFTA offers, we are committed to collaborating with our clients, businesses, key stakeholders and policy makers to build partnerships between the public and private sectors to realise this opportunity,” he said

The bank aims to build partnerships between the public and private sectors to unlock the opportunities presented by the African Continental Free Trade Area (AfCFTA).

According to him, the bank, through its trade desk, offers thought leadership and advisory on AfCFTA to clients and is keen on bringing everyone in the value chain together to understand what is happening and how it can support them.

As one of the world’s top trade banks, he added that Standard Chartered has been an active participant in Africa’s growth and development for more than 150 years, proudly contributing to the continent’s financial infrastructure and economic development. “Backed by a strong network with a presence across the continent, we have insights and knowledge of the local markets and are well-positioned to be a connector bank for our clients,” he further noted.

Mr. Godzi, speaking at the 8th Ghana CEO Summit on the topic “Reigniting business growth under AfCFTA,” also underscored the need for CEOs and business leaders to leverage their influence with the government to shape policy. He underscored the importance of establishing a regulatory framework to facilitate business operations, including initiatives such as providing tax holidays and grants, simplifying customs procedures, and investing in infrastructure, among others.

The one-day summit was themed: “Reigniting business and economic growth: charting a path forward; economic diversification and artificial intelligence transformation. A private-public sector CEO dialogue and high impact-learning.”

Additionally, he highlighted that the nation, particularly its manufacturing sector, can gain open access to a vast new market, increased competitiveness, and the potential for significant economic upliftment by seizing opportunities such as market expansion, supply chain optimization, innovation, and investment that AfCFTA brings.

With the reduction of tariffs and removal of non-tariff barriers — significant bottlenecks in intra-continental trade — he stated that the country’s businesses leveraging AfCFTA can scale operations, diversify product lines, and engage in cross-border trade more efficiently.

He further urged business leaders to adopt new technologies, explore the intricacies of neighbouring markets, and shift their business culture to unlock a broader continental mindset. This, he said, will enable them to lead the charge and expand their businesses beyond the shores of Ghana. Mr. Godzi added that by building the capacity of the nation’s youthful workforce to acquire the skills needed for modern manufacturing, AfCFTA’s dream will be realised.

Citing the Standard Chartered Future of Trade Report, he noted that by reducing barriers to trade, AfCFTA can increase Africa’s standing in global trade, which currently stands at a mere 3 percent. “Intra-Africa trade is also expected to flourish – flows within East and West Africa will grow by 15.1 percent and 13.2 percent respectively, far outpacing the global average of 4.2 percent,” he added.

The report also stated that the encouragement from AfCFTA to create regional value chains will enable manufacturers to source raw materials and intermediate goods from across the continent, leading to reduced costs and increased operational efficiency.

It further stated that by 2035, total African exports are expected to reach close to US$1 trillion. A well-implemented AfCFTA can boost this figure even higher by 29%, and intra-Africa exports, forecasted to reach US$140 billion by the same year, could be further boosted by an additional 81 percent as a result of AfCFTA.

Although AfCFTA’s potential benefits are significant, Mr. Godzi said the continent must address the challenges that lie ahead.

“Africa’s challenges require trade policies that strike a balance between national industrialisation objectives and the formation of regional value chains. First of all, it is necessary to improve upon existing infrastructure. Structural improvements in trade facilitation and a standardised payments system are critical requirements for more efficient and cost-effective trade.

“From transportation networks to energy supply and digital infrastructure, the businesses that will fully capitalise on AfCFTA will be the ones that plug these holes most effectively. This is where public-private partnerships can play a crucial role. These goals require stronger governance and cooperation,” he added.

Key intra-AfCFTA trade corridors to watch: AfCFTA’s potential boost to each country’s intra-AfCFTA trade by 2035

Mr. Reginald Aduakwa, Acting Head Transaction Banking, Standard Chartered Bank Ghana PLC, in his speech at the Summit, highlighted some of the corridors that will experience a trade boost due to AfCFTA.

For the West-Africa corridor Ghana and Nigeria are expected to boost trade activities within the region. Trade between Ghana and its West African neighbours is expected to experience rapid double-digit growth by 2035. In the West- South Africa Corridor, South Africa is expected to remain Ghana’s largest trade partner.

He mentioned that Nigeria will be a key driver of trade activities within the region, with the country’s trade activities with other West and Central Africa markets forecasted to grow rapidly through 2035. Nigeria is expected to remain South Africa’s largest source of imports whereas export growth from South Africa to Nigeria is also predicted to increase. Nigeria’s exports to Cameroon and Cote d’Ivoire are forecasted to experience robust growth.

In South and East Africa, markets like Botswana, Zambia and Mozambique will drive the corridor’s intra-exports.

Furthermore, the East Africa corridor is forecasted to be one of the highest and fastest growing trade regions within the continent, driven by trade activities between Kenya, Uganda, Tanzania, and Rwanda. For the South-East Africa corridor, South Africa is expected to remain Kenya’s largest source of imports.

Within the North African markets, he stated that Egypt will be the focal point of trade within the region with majority of its intra- Africa trade activities being amongst Northern African markets. with Libya and Morocco both forecasted to increase trade activities with Egypt. Also, in the North-African corridor, Egypt is expected to be Kenya’s largest export partner within the North -East Africa corridor. Northern Africa markets will continue to constitute majority of Egypt’s intra-AfCFTA exports; Libya and Morocco both forecast to show continuous growth.

AfCFTA will cut trade costs through digitalising customs and border procedures. This will significantly reduce the time spent using manual processes to make trade more efficient and boost cross border connectivity. It will also help alleviate infrastructural barriers and provide vendors access to a larger customer base through e-commerce platforms.

He said, as a connector bank, Standard Chartered works strategically across Africa and the corridors of Asia, Americas, Europe and the Middle East, connecting individuals, businesses and opportunities as a progressive banking partner. Standard Chartered Bank continues to engage clients to deliver best in class scalable solutions to ensure world class service delivery.

E-commerce solutions and digitalisation including digital supply chains will catalyse trade and lead to economic growth and with initiatives such as the Standard Chartered Straight2Bankpay. The bank offers local customers/industries the opportunity to engage with international partners/ customers seamlessly.

He concluded that the Bank will continue to host fora for stakeholder engagements and provide thought leadership for clients who wish to leverage the African Continental Free Trade Area, making Standard Chartered a strategic partner for all clients seeking to fully leverage AfCFTA.

Source: Thebftonline

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