The African Continental Free Trade Agreement (AfCFTA) will not immediately drive credit scores for member countries, rating firm Fitch has said. ''It could be credit positive in the longer term if successful trade liberalisation leads to an improved business environment more broadly and stronger economic growth in Africa,'' Fitch Ratings said in an outlook released Tuesday. It also envisages lowering of non-tariff trade barriers, liberalising trade in services, and advance mutual recognition of standards and intellectual property protection. ''The impact of trade liberalisation should be positive for the region’s economic potential, but the scale of the impact is likely to be small,'' Fitch said. It says that the removal of non-tariff barriers to trade under AfCFTA is likely to lag behind the agreement’s ambitions, which may blunt its effect.

Source: The Star January 13, 2021 01:52 UTC