The announcement was made by US tech company Alphabet during a virtual event where it launched an Africa Investment Fund. With the help of that fund, it will invest $50 million in startups, providing them with access to its employees, network and technologies.

Nitin Gajria, managing director for Google in Africa mentioned that the company would primarily target startups focusing on fintech, e-commerce and local language content. He told the media, “We are looking at areas that may have some strategic overlap with Google and where Google could potentially add value in partnering with some of these startups.”

Often, the small businesses in Africa struggle to get capital because they lack the necessary collateral required by banks in case they default. Once the credit is available, the interest rates are usually too high, which makes the businesses not wanting to take loans.

Google mentioned that last year the Safaricom programme, that allowed customers to pay for 4G-enabled phones in instalments would be expanded across the continent with mobile operators such as MTN, Orange and Vodacom.

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Experts say Africa’s free trade agreement could boost trade among African nations by 60 percent in just three years. The agreement will join the markets of 50 countries; unite the continent’s 1.27 billion people and its add to its $3.4 trillion nominal GDP.

The African Union (AU) finally launched the operational phase of the African Continental Free Trade Agreement (AfCFTA), after 17 years of negotiations. African countries with access to ports, railways, and airports will benefit the most from the new trade pact, making it the largest free trade zone in the world.

The agreement will cut tariffs for majority of the country up to 90 percent in the next five years, thereby, easing trade in the continent. African Development Bank President Akinwumi Adesina told the media that, “Manufacturing, trading in value-added products and strengthening supply chains will allow for markets to grow and for new markets to emerge. SMEs that account for 80 percent of all trade on the continent will benefit, as well as the financial sector, as digital payments will be needed to transact.”

The experts also highlighted the challenges that it could face such as bad transporting facilities, non-existent roads and rail lines, bad governance, corruption, and deeply entrenched bureaucracy. According to Akinwumi Adesina, the lack of infrastructure could be a major challenge. The continent’s infrastructure funding needs are at $130 billion to $170 billion a year, with a gap in the range of $68 billion to $108 billion.

He also added that the mechanics of the deal has to be negotiated. He stressed that the establishment of a digital system for payments converging one country’s currency to another membe’rs is vital before trading starts. The Economic Community of West African States plans to adopt a common trade currency to reduce foreign exchange risk.

The member nations will be provided with $4.8 million by the African Development Bank to set up the free trade zone’s headquarters in Ghana.

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