The Difficulties Africans Face When Trading Internationally

Africa is a continent of great potential. Its 54 countries are home to 1.2 billion people, many of whom are young, well-educated, and eager to build a better life. Africa's potential is also the opportunity for foreign businesses: the continent is rich in natural resources, and its economy is growing fast.

In Africa today, the majority of people benefit from international trade. International trade enables countries to access a wider variety of goods and services, providing consumers with better choices and stimulating economic activity. International trade also provides countries with opportunities to specialize in producing certain goods and services, which can increase their productivity and raise living standards. But in Africa, a significant share of the population remains shut out from the benefits of international trade.

Trading Internationally has always been a difficult topic of discussion in Africa, apart from the measures and barriers place by trade and world controlling organizations, local factors like poor transport, low productivity etc kicks African international traders down when they try to trade even with other countries in Africa.

Trade competitiveness continues to be limited by other local factors like low agricultural investment, inefficient customs regulations, lack of sufficient productivity infrastructure etc.

Globally, Non-Tariff measures (NTMs), quality and price controls, and other technical barriers all form big constraints on Africa's exports, especially agricultural and financial exports.?

We find that poor economic policies have played an especially important role in the slow growth, most importantly Africa's lack of openness to international markets. In addition, geographical factors such as lack of access to the sea and tropical climate have also contributed to Africa's slow growth.

Basically, excessive regulations are most of the problems which Africans face in international trade.

Trade barriers, such as tariffs, have been demonstrated to cause more economic harm than benefit; they raise prices and reduce the availability of goods and services, thus resulting, on the net, in lower-income, reduced employment, and lower economic output.

NTBs, Non-Tariff Barriers, are also part of what gives Africans tough times during international trade. Above these are the complicated processes for obtaining import permits, antidumping measures etc.?

A nontariff barrier is a trade restriction–such as a quota, embargo or sanction–that countries use to further their political and economic goals. Countries usually opt for non-tariff barriers (rather than traditional tariffs) in international trade. Nontariff barriers include quotas, embargoes, sanctions, and levies.

In general, any barrier to international trade–including tariffs and non-tariff barriers–influences the global economy because it limits the functions of the free market. The lost revenue that some companies may experience from these barriers to trade may be considered an economic loss, especially for proponents of laissez-faire capitalism. Advocates of laissez-faire capitalism believe that governments should abstain from interfering in the workings of the free market.

Ways To Improve International Trade in Africa

A. Information on existing regulations covering non-tariff measures need to be disseminated. International efforts have been made to gather and spread data on imposed measures guiding international trade in Africa. This data would greatly increase the international trade capacity for Africans. Knowledge is the power which is why the availability of this data would aid the African international trade market in having a wider coverage.

B. The African international trade community should adopt international standards, this will help international traders from developing countries in Africa scale through regulatory hurdles safely. So many African exporters lose their export earnings due to the fact that regulations of the International Organization for Standardization differ from the regulations which they operate by, which cause great loss to them. Also, by encouraging the adoption of international standards, countries would help their traders get integrated into the global value chains.?

C. Also, regional trade blocs should push for more regional regulatory convergence, finding common answers to address their regulatory needs. When governments come together to regulate their regulations to match international standards, it benefits the trade relationship between partakers in a trade bloc and this helps traders from each country scale regulatory hurdles with other countries as their trade regulations will be easier to work with.?

D. The amount of red taping involved in the national regulatory process should be avoided in order to save time and money, especially because most of these processes are unnecessary. Principles addressing this issue have been established (by the WTO for example), but have not been effectively applied.

E. Developing countries in Africa are affected the most by these regulatory measures, this is why they need to participate more and become one of the international standard-setting bodies. This would help them reduce procedural obstacles too and give them a better chance at increasing their international trade capacity.

What's Canta's involvement in all of this?

As Africans are working relentlessly to stay afloat amidst all the challenges they face to trade internationally, Canta's decision is to ensure transactions between traders and their suppliers happen with even more ease.

Considering how much loss traders suffer from tariffs and unfriendly policies, it is only proper to ensure there are more ways to cut down on their losses and increase their revenue.

Leveraging existing technology to reduce the complexities associated with how traders transact with their suppliers is Canta's way of gradually levelling the playing field for Africans in general.

An example of these stringent limitations is the unavailability of major payment platforms on the African continent. If you open an account with them as an African, you might only be able to receive payments using their services and this is bothersome seeing that Africans would need to leverage more than one payment service having varying conversion fees for the international payment.

Canta is Africa's answer to this, offering you the opportunity to send and receive money through your mobile phone. For those with African banks, Canta has a mobile app to help you access your bank account from anywhere in the world.

It's more like the new currency for Africans. Canta is more than a payment service: it's an extension of the African lifestyle; helping Africans do the most and possibly go toe to toe with their counterparts out there.

Get what you want, pay for it securely, without hassle.