AfCFTA

• African Continental Free Trade Area (AfCFTA)


  A trade agreement among African Countries that is aimed at creating a single market for goods and services on the continent
• The AfCFTA is one of the largest Free trade areas in the world in terms of participating countries
• Establishment of the AfCFTA

  1. Officially launched at the 12th Extraordinary Summit of the African Union in Niamey, Niger on July 7, 2019

  2. 54 African states have signed the AfCFTA Agreement, which entered into force on April 29, 2019 when the threshold of 22 countries ratifying the Agreement was reached

  3. As of January 2020, 30 countries had ratified the Agreement

  4. As of now, 46 countries have ratified, 7 countries have signed but yet to ratify and 1 country is yet to sign
• The AfCFTA marks an important milestone in Africa's long and rather strenuous history of regional integration, going at least as far back as the Abuja Treaty of 1991
• In 2012, the African Union adopted the Action Plan on Boosting Intra-African Trade (BIAT)
• General Objectives of the AfCFTA (Article 3)

  • Create a single market for goods, services, facilitated by movement of persons
  • Create a liberalized market for goods and services through successive rounds of negotiations
  • Contribute to the movement of capital and natural persons and facilitate investments
  • Lay the foundation for the establishment of a Continental Customs Union at a later stage
  • Promote and attain sustainable and inclusive socioeconomic development, gender equality and structural transformation
  • Enhance the competitiveness of the economies of State Parties within the continent and the global market
  • Promote industrial development through diversification and regional value chain development, agricultural development and food security
  • Resolve the challenges of multiple and overlapping memberships and expedite the regional and continental integration processes
• AfCFTA Protocols


  • Protocol on Trade in Goods - finished
  • Protocol on Trade in Services- Finished
  • Protocol on rules of procedure and settlement of disputes- Finished
  • Protocol on investment- Phase II ongoing
  • Protocol on competition policy- Phase II ongoing
  • Protocol on Intellectual Property Rights- Phase II ongoing
• Key Instruments of the Operational Phase of AfCFTA

  • The Rules of Origin
  • The Tariff concessions
  • The online mechanism on monitoring, reporting and elimination of non-tariff barriers, NTBs
  • The Pan-African payment and settlement system
  • The African Trade Observatory
• The deal creates a continent-wide market embracing 54 countries with 1.3 billion people and a combined GDP of US$3.4 trillion
• The first phase of AfCFTA, which took effect in January 2021, would gradually eliminate tariffs on 90 percent of goods and reduce barriers to trade in services
• That could raise income by 7 percent, or $450 billion, by 2035, reducing the number of people living in extreme poverty by 40 million, to 277 million, according to a World Bank report published in 2020
• Pilot countries selected to start trading goods under AfCFTA

  • Kenya
  • Rwanda
  • Cameroon
  • Ghana
  • Tanzania
  • Mauritius
  • Tunisia
  • Egypt
• Products identified by Kenya for trading under AfCFTA

  • Confectionery
  • Leather bags
  • Incinerators
  • Beaded products
  • Vehicular filters
  • Textiles
  • Sisal fibre
  • Avocadoes
  • Fresh produce
• Ghana has issued its first certificate of trading to a tiles manufacturing company, Keda Ghana Ceramics Company Limited, to export a consignment of its products to Cameroon
• Benso Oil Palm Plantation (BOPP) in Ghana is expected to start exporting Palm Kernel Oil to Kenya soon
• Rwanda has started exporting coffee to Ghana after Igire Coffee was issued with the rules of origin certificate
• The remaining pilot countries (Tunisia, Egypt, Tanzania, Cameroon and Mauritius) have yet to start trading under the AfCFTA due to the rules of origin assessment which, without the proper expertise, may be considered nuanced and time-consuming
• Benefits of the AfCFTA

  • Prioritizing intra-African trade
  • Broader and deeper economic integration and attracting investment
  • Higher-paid, better-quality jobs, with women seeing the biggest wage gains
  • Opportunity for investment as it allows any business to benefit from preferential treatment
  • Eliminating Tariffs
  • Growing Small and Medium-Sized Businesses
  • Contributing to Sustainable Growth
• Challenges faced during the implementation of the AfCFTA