Africa Business Day Seminar a resounding success – highlights the importance of the services economy to boosting intra-Africa trade and investment
- A key objective of this year’s Africa Day Business Seminar was to highlight the importance of the trade in services aspects of the African Continental Free Trade Area Agreement (AfCFTA) while also positioning the Western Cape as a key trade and conventions destination within the African market
- Hosting Africa Day Business Seminars in the Western Cape promotes intra-Africa trade and supports exports and investment from the Western Cape to the rest of Africa
- In 2021, Africa was the Western Cape’s second largest export region with exports to Africa reaching R46.58bn, and 20% of FDI projects from the Western Cape were destined for the rest of Africa
This year’s hybrid Africa Day Business Seminar, hosted by Wesgro in partnership with the Department of the Premier of the Western Cape, the Western Cape Department of Agriculture, and Mazars was a resounding success.
The Seminar took place on Africa Day – Wednesday, 25 May 2022 – successfully bringing together consuls general, ambassadors, key stakeholders and business delegations from the Western Cape, Angola, Mauritius, Namibia, Zimbabwe, Ghana, Ivory Coast and Togo under one roof. Objectives included highlighting the importance of the trade in services aspects of the African Continental Free Trade Area Agreement (AfCFTA) while also positioning the Western Cape as a key trade and conventions destination within the African market. Due to the COVID-19 restrictions, this year’s seminar was a hybrid event, streamed virtually to global audiences.
The AfCFTA aims to establish a free trade area spanning the 55 member states of the African Union (AU). It includes undertakings by member states to progressively eliminate tariffs and non-tariff barriers and to liberalise trade in services – cooperate on investment, intellectual property rights, competition policy, customs matters, and to establish a dispute settlement system. Negotiations on some key outstanding protocols still need to be completed before trading under the AfCFTA can commence in full. Effective implementation of the agreement will provide major opportunities for Western Cape exporters. In particular, the AfCFTA will open new markets in West and East Africa.
Over the years, interactions from Africa Day business forums have not only resulted in Cape businesses creating excellent trade links across the rest of Africa but they have also resulted in several business deals and partnerships. This year’s seminar was no different, as it also offered business a platform to showcase their goods and services, engage in Business to Business (B2B) exchanges and conclude some business deals. In terms of exports, Africa was the Western Cape’s second largest export region with exports to Africa reaching R46.58bn in 2021. When it comes to outward investment, Western Cape companies have invested more into the rest of Africa than anywhere else in the world.
Key trends in trade between the Western Cape and the rest of Africa include:
- · Total trade between the Western Cape and Africa increased by 52%, from R41.77bn in 2011 to R63.41bn in 2021
- · Over the last decade, Western Cape exports to Africa increased by 52.33%, from R30.58bn in 2012 to R46.58bn in 2021
- · Namibia was the Western Cape’s largest African export market in 2021, reaching a value of R11.09bn – followed by Botswana (R8.93bn) and Lesotho (R3.69bn) – with exports to the country growing at an average annual rate of 7.23% over the last decade
- · In 2021, 20% of FDI projects and 28.83% of capital expenditure from the Western Cape was destined for Africa and over the period 2003-2021, Nigeria, Kenya and Zambia were the largest African recipients of Western Cape FDI as measured by number of projects
- · To assist Western Cape exporters in expanding their global footprint and to strengthen the Cape brand identity across Africa and other global markets, Wesgro created the first of its kind virtual connection point – the Cape Trade Portal and ‘Made in the Cape’ brand campaign
- · In terms of tourism, in 2019, Namibia, Zimbabwe and Lesotho ranked as the Western Cape’s top three African markets. This trend continued into 2020 with Namibia and Lesotho remaining in the top three ranking, following by Malawi in 3rd position
Western Cape Minister of Finance and Economic Opportunities, Mireille Wenger, said: “I am proud to say that growing trade between the Western Cape and the rest of Africa, and boosting investment, including outward direct investment from the Western Cape into the rest of the continent, is a priority for the Western Cape Government. Leveraging the African Continental Free Trade Agreement will be essential to making sure that this important objective is realised. This agreement creates the largest free trade area in the world measured by the number of countries participating. It also cuts across sectors with the aim to identify major opportunities for countries to boost growth, reduce poverty, and broaden economic inclusion. These notable aims depend on implementation for the realisation of the full potential of the agreement. At the end of the day, it is up to us to break down the barriers that stand in the way of unleashing the full potential the African continent. We must take advantage of the post-covid recovery, and we must not hesitate to be bold, to be innovate, and to remember that Africa has everything she needs to succeed.”
“Foreigners from the rest of Africa comprised 74,3% of international visitors to South Africa in 2019. And currently, there are 13 routes out of Cape Town International Airport to 10 destinations around Africa. As a City, we are looking to further build on our relationships with destinations across the continent to show that Cape Town is a proudly African city. This includes the signing of sister city agreements like those we have done with Accra in Ghana, and Bujumbura in Burundi. Work is underway towards finalising such a partnership with Nairobi, the economic and tech powerhouse of Kenya and East Africa,” said Mayoral Committee Member for Economic Growth at the City of Cape Town, Alderman James Vos.
“Services underlie all aspects of the Western Cape economy and are increasingly important in a digitising economy. In the Western Cape, the tertiary sector accounted for 77% of GVA in 2021, with the finance, real estate and business services accounting for over one third of the province’s GVA in 2021 at 34%. The services sector as a whole also accounts for over 70% of employment in the Western Cape. Whether marketing, communication, financial services or logistics, doing business relies on services. That is why for us this year celebrating Africa Day is more than just about celebrating African unity, but it is also about unlocking services trade in Africa for Western Cape business and fostering collaboration between our destination and the rest of Africa”, concluded Wesgro CEO, Wrenelle Stander.