Standard Bank Group’s 160-year history in Africa makes the Group more than a financial services organization. The Group has become a core and an indispensable member of the African community, offering not just integrated financial services and superior value, but also supporting the continent in varied and distinct ways. In all the years that the bank has been in operation, we have been guided by the creed that Africa is our beating heart, and we are committed to creating shared value for our clients, our people, and society to help our continent realise its potential as part of the global economy.
Our vision to become the leading financial services organisation in Africa, delivering exceptional client experiences and superior value has found expression in our work on the continent over the years. Through the ever-changing expectations and needs of clients and businesses on the continent, Standard Bank has remained resolute in being the bank that continuously drives Africa’s growth. Our obligation has been to help our clients navigate the diverse African landscape to realise their dreams through our reach, deep insight and expertise about Africa, and innovative thinking. We are a critical catalyst for economic change in all countries where we operate. This lies at the core of our purpose to develop commercially sound ways to address the environmental and social challenges experienced in our countries of operation, thereby accelerating economic growth, human development and making a better life for all Africans.
Our purpose for driving Africa’s growth also means courting the right investments that provide the continent the impetus for growth. The bank has been consistent in working with multinationals seeking to make inroads in Africa to develop strategies, based on our expertise and experience on the continent, that make it easier for them to operate effectively on the continent. We believe we can make meaningful, positive impact on Africa’s growth by partnering with institutions that share this commitment.
This year’s theme for the AU Day celebration, ‘Accelerating the Implementation of the AfCFTA’ brings into sharp focus what we at the Standard Bank Group have always acknowledged and supported. In our 160 years of existence, the Standard Bank Group has been driven by a desire to see Africa grow. That is why we say Africa is our home and we drive her growth. In linking up the continent for trade, the African Continental Free Trade Area (AfCFTA) Agreement presents an opportunity to grow Africa’s economy.
For decades, Africa has been characterized by fragmented markets that inhibit the acceleration of economic growth of countries on the continent. Available statistics show that Africa trades 85 per cent with the rest of the world and only 15 percent within. The introduction of the African Continental Free Trade Area (AfCFTA) is a long-awaited intervention that promises to defragment the continent and boost the productivity of its economies. When fully ratified by all African countries, the AfCFTA will become the largest free trade area by membership established under World Trade Organization (WTO) rules integrating 55 African economies. The AfCFTA, will establish a single continental market for goods and services, facilitated by movement of capital and persons. Immediately, 1.3 billion people across 55 countries with a combined gross domestic product (GDP) valued at US$3.4 trillion (World Bank, 2020) will be connected.
Beyond its ground-breaking size, the AfCFTA promises to be a paradigm shift and a deeper commitment to the integration of the continent by negotiating goods and services simultaneously. The agreement is a potential economic game-changer for Africa’s development not only because of its potential to enhance intra-African trade but also to provide an opportunity for countries in the region to competitively integrate into the global economy, reduce poverty, and promote inclusion.
Many analysts are of the opinion that increasing trade through the AfCFTA will provide the impetus for reforms that activates productivity and job creation, thereby decreasing the incidence of poverty on the continent. Indeed, the World Bank suggests that by 2035, implementing the agreement could help to lift an additional 30 million people from extreme poverty and 68 million people from moderate poverty.
It is estimated that implementing the AfCFTA will increase the volume of intra-African trade by 81% by 2035, and increase the volume of total African exports by 29% (World Bank, 2020). By boosting intra-African trade and fostering regional value chains and production networks, the AfCFTA is expected to drive Africa’s structural transformation. Under the AfCFTA, Africa’s people, including entrepreneurs, professionals, workers and consumers, will be able to move across the continent, allowing them and the businesses they represent, to take advantage of opportunities to trade goods and services. What remains critical, however, is the agility of entrepreneurs and business people to recognize these vast opportunities and take advantage of them thereof.
As the AfCFTA beckons, business people and entrepreneurs must position themselves strategically to leverage the opportunities provided by the agreement. As a starting point, entrepreneurs must arm themselves with as much information as possible about the agreement to be able to navigate through the nuances of the agreement. Beyond learning about the agreement, value addition must be a preoccupation of businesses if the AfCFTA would be of any benefit to them. Value addition comes with capacity building that enables African businesses to progress from local players to regional players. The business community must adopt modern operations and business strategies and systems to ensure competitiveness.
The Bank has played a central role in the development of African economies for over a century and half. We have done this by constantly aligning our presence in the market-place with the evolving needs of the region’s economies – and by delivering relevant banking and financial services. When we say Africa is our home and we drive her growth, it is not mere rhetoric. It is a belief by which we live and conduct our business. Our presence in 20 African countries and our unique value to Ghanaian and African companies planning to export to other countries on the continent coupled with our understanding of the local markets and our expertise in international trade, give us the opportunity to help facilitate the operationalization of the AfCFTA. As we mark AU Day, Stanbic Bank would like to remind all Ghanaians that the dream of a Ghana with capable men and women managing the affairs of the country to achieve prosperity for all its people is still very possible.
By Farihan Alhassan
Head, Business and Commercial Banking -Stanbic Bank