African leaders gathered in Kigali have signed the Continental Free Trade Area (CFTA) treaty to create the world’s largest single market.
The agreement, signed by more than 40 African nations, is said to be the largest since the creation of the World Trade Organisation.
The pact aims at boosting intra-Africa trade by making Africa a single market of 1.2 billion people and cumulated GDP of more than $3.4 trillion.
"For Africa, after decades of independence, marked by persistent under-development and a marginal place in the international system, the terms of the debate are laid down in almost Manichean terms: Unite or Perish, as Kwame Nkrumah said at the Addis Ababa founding Summit," the African Union Commission chairman Moussa Faki Mahamat told heads of states and government at the signing ceremony.
"Our peoples, our business community and our youth, in particular, cannot wait any longer to see the lifting of the barriers that divide our continent, hinder its economic take-off and perpetuate misery, even though Africa is abundantly endowed with wealth," Mr Mahamat said.
Of the 55 African Union member states, 44 countries signed the agreement establishing the CTFA and 47 nations the Kigali Declaration launching the CFTA.
Notable among those that failed to sign the deal is the continent's largest economy, Nigeria, with President Muhammadu Buhari having skipped the AU summit amid reservations on the treaty.
South Africa, the second largest economy, only signed the Kigali Declaration.
While many countries signed the deal to allow free trade, only 29 nations signed the Protocol on Free Movement of Persons and the African Passport. The protocol allows for free movement of people, right to live and establish a business anywhere in Africa.
“The promise of free trade and free movement is prosperity for all Africans, because we are prioritising the production of value-added goods and services that are made in Africa,” Rwandan President Paul Kagame, the chairman of the AU said.
For businesses, CFTA commits governments to remove tariffs on 90 per cent of goods produced within the continent and phase out the levy in the future.
Governments now have to ratify the CFTA in their countries within the next six months, by September this year. Those that did not sign can also do so during the window.
The trade deal will come into force after 22 countries have ratified it.