2021 African Integration Day: Highpoints of AeTrade’s high-level convening on SME’s role in AfCFTA’s implementation

The African Electronic Trade (AeTrade) Group hosted a high-level session on the role of SMEs, youth and women in the implementation of the AfCFTA at the virtual 2021 African Integration Day held Wednesday (July 7), after which the Group announced Rwanda and Ethiopia as hosts for its continental and East African regional headquarters, respectively.

 

 

The AeTrade Group is a social enterprise that aims to fill crucial gaps in e-commerce and other ICTs in Africa. The central commitment of AeTrade is digitalizing intra-and inter-African trade by encouraging investment in SMEs with a view to creating more jobs for Africa’s growing youth population and generating wealth across the continent. The Group therefore considers the launching of the AfCFTA as an opportunity for Africa to make meaningful economic progress towards electronic trade and the adoption of technological tools to enhance effectiveness in governance with the support and participation of the private sector.

Against this backdrop, the high-level event on the occasion of the 2nd commemoration of the African Integration Day was themed: “Accelerating Africa’s Integration driven by SMEs, Women and Youth as an integral part of AfCFTA Implementation and Africa’s Post-COVID-19 Economic Recovery.”  Consequently, the high-level session served as a platform for AeTrade to accelerate its advocacy for youth employment and inclusion of SMEs, women and youth in Africa’s economic integration and digital transformation strides.

The meeting which was moderated by the Interim President of the African Business Council (AfBC), Dr. Amany Asfour, featured a diverse range of distinguished speakers including H.E. Wamkele Mene, Secretary General of the AfCFTA Secretariat and H.E Albert Muchanga, Commissioner for Economic Development, Trade, Industry and Mining at the AU Commission, who delivered a welcome address.

Other high-profile African leaders who spoke on the session’s theme were Mr Melaku Alebel, Minister of Trade of Ethiopia; Ms Paula Ingabire, Minister for ICTs and Innovation of Rwanda; and Mr Manqoba Khumalo, Minister for Commerce, Industry and Trade of the Kingdom of Eswatini. Other distinguished speakers were Ms Ahunna Eziakonwa, Director of UNDP’s Regional Bureau for Africa; Ms Pamela Coke-Hamilton, Executive Director of the International Trade Centre (ITC); as well as Mr. Mulualem Syoum, CEO/Chairman of AeTrade Group who delivered a progress report on AeTrade’s partnership with the AU.

The private sector was represented by the Vice President of the Pan African Chamber of Commerce and Industry, Prince Adetokumbo Kayode, and the Vice President of the Burkina Faso Chamber of Commerce and Second Vice President of the Federation of West African Chambers of Commerce and Industry, Mr. Doudou Oumar Doumbia. Dr. Amany Asfour indicated that the African Business Council, which was established as the premier voice of the African private sector and is inclusive of all private sector associations, was keen to work closely with the AeTrade Group to bring businesses from across the continent to the Sokokuu platform, being an Africa-owned and led inclusive platform for Made in Africa products and services in the AfCFTA market.

 

We’ll make women, youths key players in Africa’s emerging digital economy – Syoum

In his progress report on AeTrade Group’s partnership with the AU, Mr Mulualem Syoum, CEO/Chairman of the Group, said the AU’s partnership with AeTrade had achieved a lot in the previous three years, significantly strengthening co-operation and strategic alliance between the Union and the private sector. “We are committed to deepening and widening our partnership with the AU and its Member States, for a better future for African citizens. Today’s panel is a testimony to our efforts and dreams to do more for the continent, faster and better, through collaborations and inclusiveness, using technology and changing mindsets,” he pledged.

Mr Syoum said AeTrade would as well closely engage the Regional Economic Communities (RECs), being the recognized building blocks of the African Common Market, adding that the Group had already secured the support of leading African private sector entities for its Pan African e-commerce platform Sokokuu. The entities he identified were the African Business Council (AfBC); the Pan African Chamber of Commerce and Industry (PACCI); the Federation of West African Chambers of Commerce and Industry (FEWACCI); as well as the East African Chamber of Commerce, Industry and Agriculture (EACCIA), among others.

“Sokokuu is an inclusive platform that will be a game changer to Africa’s economic integration; it is a brand that is rapidly becoming a household name, upholding and making visible ‘Made in Africa’ goods and services. Thousands of SMEs have registered on the platform, we need Africans to buy ‘Made in Africa’ products. We have established strategic partnerships with leading cargo and logistics players such as Ethiopian Airlines and DHL. We encourage our partners in the private sector including large corporates to mobilize their members to join Sokokuu so we can shift our discussion from aid to trade. We make a special appeal to the Diaspora to join our efforts to create a truly integrated fulfillment and logistics infrastructure,” appealed Syoum.

The AeTrade CEO said the Group was strongly committed to empowering women and youth thus was already establishing partnerships with women-owned and youth-led businesses, urging African leaders to come up with policies that would enable MSMEs compete favorably in the AfCFTA regime. He said the proposed Women in Trade Protocol of the AfCFTA Agreement with binding provisions as an integral part of the Agreement would make an important contribution to the continent’s transformation agenda.

“AeTrade Group stands in solidarity with the youths; Africa is a youthful continent with over 450 million young people aged 15-35. Every year, about 12 million young Africans join the labour market but jobs are very limited. These days, young people who are fortunate to attend university are living with little hope and the COVID-19 pandemic had turned their little hope to increased despair. We have therefore been working on how to improve our support for youth employment,” the AeTrade CEO said.

Syoum said as part of his Group’s efforts to empower women-owned and youth-led businesses they had in partnership with the AU and Afreximbank launched the Global Competition for African Entrepreneurs: Youth, Women, SMEs, and Start-ups, under which AeTrade will be supporting 150 African entrepreneurs to participate in the 2021 Intra-African Trade Fair (IATF 2020) holding in Durban, South Africa, come November 15 -21, 2021. This competition is borne out of AeTrade’s belief in youth investment as a means of guaranteeing Africa’s future thus the Group is looking for innovative ideas from Africans across all sectors and at all stages of development to be exhibited before venture capitalists at IATF 2021.

“The future lies in mobilizing investment for youths, we have a plan to accommodate a huge number of youths in our programme linked to our research and innovation centre which will be domiciled at our continental headquarters. We have planned a youth programme which involves using the cloud computing infrastructure to create opportunities for the youths, protecting their intellectual property and accelerating their ability to create wealth,” he stated.

In his conclusion, Syoum said by the 2022 African Integration Day, AeTrade would in the spirit of mutual accountability be reporting back to the AU on the establishment of regional headquarters in all the 5 AU regions as well as a continental headquarters, noting that by end of 2023, the Group would have created 12000 jobs across Africa; more than half of which would be women and majority under the age of 35.

“In addition, AeTrade would have by end of 2023 created a country programme across every AU member state that had ratified the AfCFTA and we would have mobilized thousands of entrepreneurs through Sokokuu; built an integrated fulfilment and logistics architecture as well as ensuring financial inclusion and digital inclusion, with renewable energy being our top priority. We will ensure an inclusive approach to building digital capacity at the grassroots level and enable SMEs, women and youth to be key players in the emerging digital economy in Africa,” concluded Syoum.

 

Trade liberalization would be incomplete without inclusion of youths, women – Mene

H.E. Wamkele Mene, Secretary General of the AfCFTA Secretariat, in his address noted that trade liberalization by the AfCFTA would not be successful if young people and women were not given the opportunity to participate fully in the trade Agreement. Mene therefore said both the proposed Protocol on Women in Trade and the Protocol on Digital Trade would give further impetus to trade liberalization in Africa, and more importantly, provide young individuals and women the creative platform to reap the benefits of the AfCFTA.

“Young entrepreneurs across the continent are at the cutting edge of technological advancement and innovation so we have to ensure we establish favourable environment for them to reap the benefits of the AfCFTA Agreement. If you go to Lagos, Johannesburg and Kigali, you will find young entrepreneurs eager to contribute to the growth of Africa’s economy through their innovations. This is why the Protocol on Digital Trade and Platforms is so important because it would enable Africa position itself, in light of the COVID-19 pandemic, as a frontier market in terms of the Fourth Industrial Revolution (FIR) and the positive disrupters the FIR presents not only to Africa’s economy but the global economy as well,” he said.

The AfCFTA chief said there was already many existing success stories indicating Africa’s huge potential in terms of digital trade, referencing the Kenyan flower farmers who he said were already accessing global flower markets through digital platforms, adding that Africa was also at the cutting edge of mobile banking technology, which makes the continent globally competitive from a digital trade standpoint.

“The COVID-19 pandemic had been a very severe and significant barrier to our being able to start trading in the previous year, but I am happy that most African countries appear to be winning the fight against the pandemic which will allow us the opportunity to implement the AfCFTA as fast and as aggressive as possible. The Implementation of the AfCFTA is important in the context of COVID-19; countries around the world particularly developed ones have cumulatively provided economic recovery packages to their populations worth $15 trillion. The point I want to make is that many African countries do not have the fiscal and monetary policies to provide these large stimulus packages to rejuvenate their economies, post COVID-19.

“Therefore, for us in Africa, the stimulus package would be the aggressive implementation of the AfCFTA to combat the effect of COVID-19 and make sure Africa recovers relatively quickly. Boosting intra-African trade has the potential to contribute to Africa’s economic recovery. Last year, the World Bank estimated that through the AfCFTA and its resultant market integration, we have an opportunity to lift 30 million Africans out of extreme poverty. And the main beneficiaries would be SMEs owned by women cross-border traders. Therefore, we have to put in place all the necessary mechanisms to help women and youths benefit from the integration brought about by the AfCFTA,” Mr Mene concluded.

 

We’re working with AeTrade to create 600,000 jobs for women, youth – UNDP Africa Director

In her remarks, Ms Ahunna Eziakonwa, Director of UNDP’s Regional Bureau for Africa, described the AfCFTA as a game changer in Africa’s quest for integration, noting that the commemoration of the 2021 African Integration Day had come at a time when the continent was battling the negative impacts of COVID-19 on livelihoods, particularly deepened poverty levels and stagnated economic growth in African countries.

“I urge us to look at where the future lies, that is, trade and its potential to accelerate SDG implementation, which gives us the impetus for hope. In the African context, AfCFTA is the embodiment of that hope. As we deliberate on how we can accelerate Africa’s integration, driven by SMEs, women and youth as an integral part of AfCFTA’s implementation and Africa’s post-COVID-19 economic recovery, we must ensure the AfCFTA breaks the cycle of Africa’s underutilization of opportunities presented by trade agreements,” she urged.

Ms Eziakonwa thus challenged African leaders to leverage the opportunity of the commemoration of the Integration Day to recommit to utilizing the AfCFTA as the main driver of Africa’s recovery from COVID-19, noting that RECs such as SADC and COMESA had already been experimenting with free trade agreements, which she credited with the current 18% intra-African trade. She particularly praised SADC’s recording of $50 billion from intra-regional trade in 2019, realized through a diversified trade portfolio, from manufacturing to agriculture.

“How can Africa leverage AfCFTA’s implementation to build more resilience, shockproof its development and create the much anticipated prosperity in an inclusive manner? At UNDP, we are leveraging our unique development mandate and also our country-level presence to do four things. First, build a strategic partnership with the AfCFTA Secretariat to strengthen its capacity for the implementation of the Agreement. Second, supporting improved understanding of the opportunity presented by the AfCFTA which may not be obvious to countries including our joint work on understanding which value chains are viable under the AfCFTA’s scope.

“Third, strengthen the capacity of exporters to utilize this opportunities. Four, building and nurturing key partnerships with institutions in and outside of the UN to help us go farther and faster. In this context, I am pleased to note the important progress we are making with AeTrade with whom we will be working to provide targeted, country-level support to create 600,000 jobs by onboarding women and youth enterprises to the Sokokuu platform,” she stated.

 

COVID-19: African youth-led enterprises facing survival risk – ITC Director

Speaking on how Africa could support SMEs, women and youth through the operationalization of the AfCFTA, Ms Pamela Coke-Hamilton, Executive Director of the International Trade Centre (ITC), said although achieving full integration in Africa by aligning tariff schedules, harmonizing regulations, and building true regional value chains was an enormous task, the price of doing so was worth the enormity of the task. Ms Coke-Hamilton said the AfCFTA offers incredible opportunities for self-reliance, such as increasing regional income by 7% and speeding up wage growth among women.

“The AfCFTA provides a path away from commodity dependence, towards diversification and self-reliance, towards higher participation of women, youth and small businesses in trade, both within Africa and with the world. Integration creates not only transformation but also inclusivity; this transformation and inclusivity is more than ever before needed now when economies in Africa have been so badly impacted by COVID-19,” she noted.

Accordingly, Ms Coke-Hamilton said the ITC was supporting the AU to build a single market by lowering the cost of trade and building cross-border markets, through amongst others, the establishment of the African Trade Observatory. She said the Observatory would help African governments monitor their progress towards accomplishing the objectives of the AfCFTA, by helping them gather quality data and train their officials and businesses on how to use the data.

“There are $22 billion of untapped intra-regional export potential to be harnessed, which is why we keep working to make the Observatory more relevant and user-friendly. We know that realizing the full promise of the AfCFTA requires a holistic approach; we can’t transform economies without tackling regional integration from all angles. This is why we developed the One Trade Africa programme which will support small businesses, especially those owned by women and youth to become more competitive; it will help them find buyers, sellers and build their business ecosystems. It will also enable them link up with value chains within their regions, across the continent and around the world,” the ITC chief revealed.

On a positive note, Coke-Hamilton said the COVID-19 pandemic had brought about a rise in digital sales across the world which she described as a game changer that could create millions of jobs in Africa. That notwithstanding, she said ITC findings revealed African businesses were facing real challenges on the digital front such as low consumer trust, weak regulatory frameworks as well as poor infrastructure. Ms Coke-Hamilton noted that increasing digital connectivity and closing the digital divide to connect Africa to the world was a priority of the ITC and its partners, and also a personal priority for her as a Jamaican of African descent.

“Our own ITC COVID-19 business survey shows that youth-led enterprises in Africa face a real risk to their very survival; more than a quarter of businesses led by young people say they risk shutting down permanently within three months, compared to one-fifth for other kinds of businesses. We can only imagine what impact this will have on youth unemployment in Africa. In short, we have to act soon!  The ITC is committed to the actualization of African integration, we have been supporting African governments with tools to bring markets together for now more than five decades. We are proud to continue to be your partner going forward,” Ms Coke-Hamilton assured.

 

We must incorporate gender in Africa’s digital inclusion – Rwanda’s ICTs Minister

In her remarks, Ms Paula Ingabire, Rwanda’s Minister for ICT and Innovation, said Africa’s integration had never been as important as it was now when the continent was battling with the negative effects of COVID-19 on its economy and the health of its people. She said Rwanda was now positioning itself as the continent’s ICT and logistics hub adding that, by working together under the leadership of the AU, African countries would help the continent emerge faster and better out of the challenges brought about by the pandemic. In this vein, the Government of Rwanda welcomes the AeTrade Group to establish its continental headquarters in Kigali, its capital.

The Rwandan minister said her country was desirous of making itself the ideal hub for global and African innovations who could leverage Rwanda as their taste bud as they grow to expand their operations throughout the continent, adding that the Government of Rwanda was especially keen on building partnerships with private sector organisations, the international community, development cooperation partners as well as stakeholders in the digital economy.

“We recognize the need to incorporate gender equity in Africa’s digital inclusion policies. We therefore welcome the decision to create a Protocol on Women in Trade under the auspices of the AfCFTA. We believe gender mainstreaming across all policy areas to be critical. Additionally, as a landlocked country with limited natural resources, we greatly understand the enormous potentials of our people in general and SMEs, women and youth, in particular. So, we are encouraging enabling policies that are national, regional, and continental in nature,” Ms Ingabire said.

 

AeTrade creating an ecosystem to support, incubate SMEs” – Ethiopian Trade Minister

In his remarks, Mr. Melaku Alebel, Ethiopia’s Trade Minister, said the idea of achieving African integration had been a longstanding objective of the Government of Ethiopia, as a vital component of its broader programme aimed at transforming the Ethiopian economy from an agrarian one to a modern industrial economy.

“We firmly believe in strengthening our trade relationship with other African countries through the AfCFTA. This is very important not only because of the volume of trade but also to achieve the objective of the Pan African movement of creating a strong and united Africa. In general, the AfCFTA aims to shift the gear of Africa’s overall economic growth and industrialization drive in accordance with Agenda 2063: The Africa We Want. At this juncture, I will like to reaffirm Ethiopia’s unwavering commitment to the AfCFTA process,” assured the minister.

While speaking on the theme of the AeTrade high-profile convening, Mr Alebel called for the creation of  an ecosystem  of support for SMEs to shield and incubate them to grow while also allowing them the opportunity to become independent, noting that the “AeTrade has come up with an innovative approach to do that, striking a balance between Ubuntu and building a competitive approach to business which allows the SMEs to access the AfCFTA marketplace, with support for step by step growth, which will help Africa create its own millionaires and billionaires.”

 

COVID-19 recovery doomed, without women, youth – Eswatini’s Trade Minister

In his remarks, Mr. Manqoba Khumalo, Minister of Commerce, Industry and Trade for the Kingdom of Eswatini, blamed the fact that African integration was not progressing at the desired pace due to the non-involvement of SMEs, women and youth as drivers of the continental integration efforts. He thus noted that the AfCFTA presents an amazing opportunity for women and youths to play an integral role in accelerating Africa’s integration adding that Africa’s post-COVID-19 economic recovery strategy was doomed to fail if the continent excludes SMEs, women and youths.

“In Eswatini we are making efforts to make sure SMEs, women and youths are not marginalized in the mainstream of our economic activity. For all new FDI coming into the country, we successfully made a business case for SMEs to be the preferred providers of goods and services for these giant companies. In addition, we leverage our strategic partnerships to address some of the challenges these groups are facing in Eswatini. With funding from the EU through COMESA, we have finished the construction of a trade hub with lodging and storage facilities for hundreds of informal traders, mostly women from our rural communities,” he said.

Minister Khumalo said an accelerated integration of Africa required the full participation of SMEs, women and youths who formed a huge chunk of Africa’s demography hence the need for countries to mainstream them in their plans. “Mainstreaming these groups in our economy is a collaborative effort which requires strategic partnership with those who share the ideals and aspirations of our governments, knowing fully well that our biggest common enemy in the continent and across the globe is the scourge of poverty,” concluded Khumalo.

 

The AeTrade press conference

The AeTrade high-level meeting was followed immediately by a press conference where the Group formally announced the host countries for its regional and continental headquarters as well as providing an update on the Group’s partnership with the AU. In a press statement released shortly after the conference, AeTrade announced it had accepted the offer of the government of Rwanda and Ethiopia as hosts for its continental headquarters and East African regional headquarters, respectively.

“After an open and transparent process and invitation of all AU Member States to express interest which was launched in October 2019, the AeTrade Group has received fourteen written expressions of interest and three verbal expressions bringing the total to seventeen countries. After physical and virtual exploratory missions that were held with all the interested countries, and a rigorous review of the offers submitted by candidate countries, the High-Level Panel recommended two countries to be considered by the AeTrade Group Board of Directors on the 25th June 2021. The AeTrade Group Board met on the 29th June 2021 and pronounced itself on the outcome which is being announced today,” said the press statement.

“On behalf of the AeTrade Group, I wish to extend our warmest congratulations to the Government and the people of Rwanda for winning the bid. We thank all seventeen countries for their confidence in us and look forward working with all AU Member States in line with our partnership with the African Union to ensure an inclusive approach to building digital capacities at the grassroots to enable SMEs, Women and Youth to be key players in the emerging digital economy in Africa,” Mr. Syoum was quoted to have said in the statement.

In her response, Minister Ingabire who accepted the award of the AeTrade continental headquarters on behalf of her country, said: “We are confident that the AeTrade Group initiatives fully align with the Government of Rwanda’s agenda to become an ICT and logistics hub. Therefore, the Republic of Rwanda commits to provide the required support to ensure the success of the initiative. We look forward to welcoming you to Rwanda and from here to facilitate the implementation of the AeTrade Group vision towards productive impact to continental sustainable economic development inspired by the African Union Agenda 2063.”

Mr Syoum had in a separate statement equally extended his congratulations to the government of Federal Democratic Republic of Ethiopia, for successfully bidding to host the Eastern Africa regional headquarters of the AeTrade Group, thanking the Ethiopian government for the confidence it had placed in AeTrade Group.

Minister Alebel who accepted the award of the East African headquarters of AeTrade Group on behalf of the Ethiopian government said his country was committed to ensuring that the Group’s initiative yielded the envisioned socio-economic benefits for East Africa. “We are ready to promote home-grown solutions to Africa’s problems and believe that platforms such as Sokokuu shall be the dominant force in the vibrant market place connecting millions of MSMEs to trade out of poverty. We are proud to be associated with this digital capacity building initiative led by the African private sector in partnership with governments. It is a practical demonstration of the huge potential of Africans when we unite and work together,” the minister said.

In his remarks at the press conference, the AU Commissioner for Economic Development, Trade, Industry and Mining, Amb Albert Muchanga, said a significant progress had been recorded by the AU in its partnership with AeTrade Group, in support of the implementation of the Union’s regional integration initiatives. He also congratulated the governments of Rwanda and Ethiopia for winning the competitive bids to host AeTrade’s continental and regional headquarters respectively, adding that the AU Commission was looking forward to “working with all AU Member States as they harness digital technologies and enabling policy measures including the African Continental Free Trade Area in order to create millions of jobs, especially for the youth across the continent.”

The announcement of Rwanda and Ethiopia as the hosts of AeTrade’s continental and regional headquarters respectively, followed the announcement exactly two years ago in Niamey, Niger of the Kingdom of Eswatini and the Republic of Guinea as AeTrade’s regional headquarters for Southern and West Africa, respectively. Thus, the 2021 African Integration Day announcement brought the total number of AeTrade’s host governments to four, with regional offices for North Africa and Central Africa to be decided later. AeTrade said all Heads of State of their host countries had now become members of its Presidential Advisory Board, a high-level structure to provide strategic oversight and guidance to its work with all AU member states.