President John Mahama says the African Continental Free Trade Area (AfCFTA) offers the continent its best shot at meaningful economic transformation, but warned that Africa must fix critical bottlenecks to fully unlock its potential.

Speaking at the private-public business dialogue at the ongoing 9th Tokyo International Conference on African Development (TICAD IX) in Yokohama on Thursday, he described the free trade pact as a “game changer” but one that still requires urgent infrastructure investment to make it effective.

“I believe that the environment in Africa is better known at TICAD 9 than it was in TICAD 8, because now we have the African continental free trade area.

"We have the beginning of a basis to bring the continent together. Be able to set up in one country, but have a market of 1.4 billion people, instead of a market of 33 million people in Ghana,” Mahama said.

He explained that although protocols have been signed to enable duty-free and tariff-free trade across the continent, weak logistics continue to defeat the purpose.

“If I want to export something from Ghana to Kenya, tariff-free, duty-free, even though we’ve signed the protocols, it’s most likely that I’ll put it on a boat.

"That boat will go to Europe before it comes back to Africa and Kenya. And so my freight costs are going to be higher. And so the savings that I make in terms of being able to export duty-free, tariff-free, are consumed by extra freight charges.”

President Mahama urged African leaders to make governance reforms that ensure stability and predictability for investors, while also addressing corruption.

“We need governance reform. We need to reduce corruption, and we must have accountable governance. Our people must feel that their resources are being put to good use.

"We must make sure that our economies are stable and predictable, so that if a Japanese investor wants to come and invest or partner with our young people in the service industry or industry or FinTech or whatever, he knows that he has a stable, predictable environment to be able to make that investment, and that he’s able to repatriate his profit if he’s able to make that profit.”

He also called for transparency in commitments made to Africa at earlier TICAD conferences.

“TICAD 8 pledged $30 billion for investment in Africa. I’d like to see what the audit of that would be, how much went into what?”

But he stressed that the AfCFTA presents an unprecedented opportunity for Africa if paired with Japan’s strengths.

“I believe that Japan has the innovation, Japan has the technology. Africa has natural resources. Africa has the young, innovative people, and if TICAD brings those two factors together, I believe that it would have been worth our while staying in Yokohama for three days.”