Forty-four African countries agree a continent-wide free trade deal

Forty-four African countries have signed an agreement to form an African Continental Free Trade Area (AfCTA), while a total of 50 have either signed the agreement or given their commitment to the project. The news has been broadly welcomed across the region, particularly the plans to double intra-African trade. AfCTA aims to double intra-African trade by removing non-tariff and tariff barriers on goods and services. Some 27 countries also signed a separate African Union Protocol on Free Movement of People, which complements the AfCFTA by providing for visa-free travel, the right of residency and the right of business or professional establishment for citizens between signatory countries. “With the signature of the Kigali Declaration for the launch of the African Continental Free Trade Area, Africa makes a giant stride forward in continental integration, in the pan-African vision, and in the development of our continent”, said Vera Songwe, executive secretary of the UN Economic Commission for Africa (ECA). During his keynote address, President Paul Kagame of Rwanda, chairperson of the African Union, said: “The AfCFTA [was] the culmination of a vision set forth nearly 40 years ago in the Lagos plan of action adopted in 1980,” for a continent-wide market. He also recognised the preeminent role of the regional economic communities in fostering African integration. Moussa Faki Mahamat, chairperson of the African Union Commission, added: “Africa is a sleeping giant that can’t wake up if the continent is divided. It’s time to accelerate the pace of integration, as international competition leaves no room for the weak.” He also called upon African member states to sign the protocol on the free movement of persons, enabling the creation of an African passport. The ECA executive secretary also urged member states to promptly ratify the AfCFTA, recalling that the agreement will only enter into force once a sufficient number of countries have ratified the agreement. Likewise, the ECA chief said the signing of the AfCFTA only marks the end of the first phase of the AfCFTA negotiations, insisting on the need for effective implementation. The AfCFTA Country Business Index launched by the ECA during the summit will be one of the tools to keep track of implementation, through periodic surveys of business opinions on the real impact of the agreement on trade. Ms Songwe also reaffirmed the necessity to leave no one behind, as defined in the Sustainable Development Goals, by making sure everyone benefits from the new opportunities created by the AfCFTA. According to the ECA, among the key beneficiaries will be small and medium-sized enterprises, accounting for 80% of the region’s businesses; women, who represent 70% of the informal cross-border traders; and the youth, who will be able to find new employment opportunities. The ECA estimates that the AfCFTA has the potential both to boost intra-African trade by 52.3%, by eliminating import duties and to double this trade if non-tariff barriers are also reduced. However, the Manufacturers Association of Nigeria (MAN) strongly supported the Nigerian government in its refusal to sign the agreement. MAN opposed the contents of the agreement, warning that it will lead to gross unemployment in Nigeria. Association president, Dr Frank Jacobs, said his association would not support the federal government’s adoption and ratification of the agreement establishing the AfCFTA until issues of market access and enforcement of rules of origin are addressed. According to MAN, the private sector was concerned about the lack of consultation and inclusion key stakeholders’ inputs. Noting that MAN is not oblivious of the benefits inherent in installing a continental trade agreement like AfCFTA, Dr Jacobs said Nigeria's national interest should, however, be the primary consideration in the decision to sign such an arrangement. “Government should, as a matter of urgency, convene a special meeting of the relevant stakeholders, including experts on trade policy, to consider tariff lines rates along the line of efficiency, sectoral and sub-sectoral preferences that would be most beneficial to Nigerian businesses under the AfCFTA dispensation, as well as reconsider the national position on EPA vis-a-vis the AfCFTA, especially on tariff lines of products on the sensitive/exclusion list, with a view to ensuring that the EU-EPA is not reintroduced through the AfCFTA's back door,” he added.

Forty-four African countries agree a continent-wide free trade deal

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