The African Continental Free Trade Area (AfCFTA) Secretariat and African Export-Import Bank (Afreximbank) have formalised the agreement relating to the management of the base fund of the AfCFTA adjustment facility.
The pact took place on Wednesday in Cairo, Egypt, a statement by the bank said.
The fund will support African countries and the private sector to effectively participate in the new trading environment established under the AfCFTA.
The News Agency of Nigeria (NAN) reports that Afreximbank and the AfCFTA Secretariat were mandated by the AU Summit of Heads of State and Government and the AfCFTA Council of Ministers for Trade to establish the adjustment fund.
This is to support AfCFTA State Parties to adjust to the new liberalised and integrated trading environment established under the AfCFTA Agreement.
“The Adjustment Fund consists of a Base Fund, a General Fund and a Credit Fund.
“The Base Fund will consist of contributions from State Parties, grants and technical assistance to address tariff revenue losses as tariffs are progressively eliminated and support countries to implement various provisions of the AfCFTA Agreement, its Protocols and Annexes.
“The General Fund will mobilise concessional funding, while the Credit Fund will mobilise commercial funding to support both the public and private sectors, enabling them to adjust and take advantage of the opportunities created by the AfCFTA,” the statement stated.