WORK STARTS HERE ON AFRICA’S NEW FREE TRADE AREA

At a time when the global trade regime is under attack, the African Union (AU) is celebrating the establishment of the African Continental Free Trade Area (AfCFTA), which came into effect on 30 May.

After being ratified by the required minimum 22 nations, all the member states of the AU are now legally bound to allow African goods to be traded without restraint throughout the continent.

This is an impressive achievement. AfCFTA not only covers the entire continent, but has proceeded at a record pace. It was signed on 21 March 2018. Its entry into force underlines African leaders’ commitment to pan-African economic integration – a goal as old as African independence in the 1960s.

Intra-regional trade has long been minimal in Africa, standing at 13% for intra-imports and 17% for intra-exports over the last seven years. Earlier continental trade initiatives, such as the 1980 Lagos Plan of Action and the 1991 African Economic Community, have lagged far behind their ambitions.

However, the practical implications of the continental free trade area are not immediate. Significant work is required to deliver tangible results. Negotiations on tariffs, time lines and the seat of the AfCFTA Secretariat are still ongoing. And without effective public policies, liberalising trade risks having negative implications for many people on the continent.

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