Cape Town, April 17, 2023 – Standard Bank, Africa’s largest bank by assets and a key sponsor of this week’s African Continental Free Trade Area (AfCFTA) Business Forum in Cape Town, emphasizes that the AfCFTA presents a crucial opportunity for Africa to alleviate poverty, drive economic activity, and achieve prosperity for its people. The AfCFTA aims to lift 30 million Africans out of poverty by increasing income across Africa by 7% by 2035 through the elimination of trade barriers and the promotion of intra-Africa trade. Once implemented, it will be the world’s largest free trade area.
Philip Myburgh, Head of Trade for Business and Commercial Banking at Standard Bank, highlights the bank’s commitment to driving Africa’s growth and unlocking opportunities across the 20 markets it serves. Myburgh acknowledges that trade barriers and other protective internal policies remain stumbling blocks to the realization of AfCFTA’s goals. He states, “As Africa’s largest bank by assets, Standard Bank is building the finance and trade solutions to help address the tariff and non-tariff barriers required to realize the continent’s ambitions to create an effective single market.”
Myburgh also emphasizes the need to develop manufacturing capabilities to beneficiate products and produce finished goods, as well as the importance of infrastructure, such as rail, road, and port infrastructure, to facilitate the movement of goods across vast territories. He further identifies access to trade finance as a challenge, with perennial risks limiting commercial credit appetite. Myburgh suggests leveraging the ability of Africa’s financial institutions to deploy capital from development finance institutions and sovereigns into effective trade finance, particularly for entities that have not yet built up their credit standing, as a means to dramatically expand intra-African trade.
In addition, Myburgh highlights sectors with high growth potential, such as agriculture and energy, where banks and the private sector could work with AfCFTA to begin implementation in 2023. He notes that agriculture is the bedrock, biggest earner, and greatest employer in many African markets, and improving the movement of food and agricultural goods, inputs, services, and people could have a disproportionately large positive impact on social stability, growth, investment, and national revenue across the continent. He also underscores the potential of energy and power infrastructure as a driver of regional and continental growth through cross-border cooperation and coordinated national investment.
Myburgh further emphasizes the role of free trade or special economic zones as drivers of investment, production, and export earnings among African economies. He also highlights the booming digital ability of the continent, supported by a youthful population, as another avenue for Standard Bank to provide finance, guidance, and digital platforms and connectivity to grow Africa’s digital revolution into a global investment proposition.
Standard Bank’s Africa Trade Barometer, which provides a near real-time view of trade openness, access to finance, macro-economic stability, infrastructure, foreign trade, governance, economic performance, and trade finance behavior in Africa, is identified as a response to the significant non-tariff barrier of access to information in Africa.
Myburgh emphasizes the power of partnerships, awareness of what is needed, and access to trusted information as the key to Africa’s success in realizing the vision of a single African market. He sees the AfCFTA Business Forum as the perfect opportunity to establish these partnerships and breathe life into the move to a single market. He concludes, “It is important that we use this opportunity to accelerate moves to a practical cross-border framework on which to build the institutions, systems, and practices capable of uniting Africa’s business potential into a continental force for growth.”
