The AfCFTA will be governed by five operational instruments: the Rules of Origin; the online negotiating forum; the monitoring and elimination of non-tariff barriers; a digital payments system and the African Trade Observatory. Each one was launched by different Heads of State and Government that included President Cyril Ramaphosa of South Africa, President Abdel Fattah El Sisi of Egypt who is current Chairperson of the AU; Mr. Moussa Faki Makamat, the Chairperson of the African Union Commission; and President Mahamadou Issoufou of Niger, who is the Champion of the AfCFTA. The launch ceremony included “a roll call of honour”, at which the 27 countries that have ratified the instruments of the AfCFTA were announced, and those that have signed but not yet ratified were mentioned. A commemorative plaque of the signing was also unveiled. The AfCFTA agreement was adopted and opened for signature on 21 March 2018 in Kigali. The AfCTA entered into force on 30 May 2019, thirty days after having received the twenty-second instrument of ratification on 29 April, 2019 in conformity with legal provisions. “The speedy entry into force of the AfCFTA is a source of pride for all of us”, said AU Commission Chairperson Mr. Moussa Faki Mahamat. He described the free trade agreement as one of the instruments for continental integration in line with the objectives of the Abuja Treaty and the aspirations of Agenda 2063. The Chairperson also highlighted the importance of peace building and security on the continent, adding that “it would be...

Kenya’s manufacturing sector is betting big on the proposed Africa-wide trade pact that will provide access to what has been described as the biggest market in the world. Nigeria became the latest member to sign the landmark agreement, which aims to increase trade among African countries. With Eritrea as the only African country not to be part of the trading bloc, the potential for the regional initiative to transform the economies of the member states looks pretty real. According to the Oxford Business Group, Kenya’s exports are projected to increase by over Sh10.2 billion ($100 million) following full implementation of the free trade pact. The group notes that with 41.2 per cent of Kenya’s exports destined for free trade pact member states in 2011, compared with the 13.4 per cent share of imports from the same zone, Kenya enters the bloc from a position of relative strength. Only 12 per cent of Africa’s trade is between countries, signifying the huge promise for participating countries. Kenyan manufacturers are banking on the agreement to take the lead in producing competitive products in terms of quality and prices. “The Continental Free Trade Area agreement provides an opportunity for Kenya to become a manufacturing hub for Africa,” said Kenya Association of Manufacturers (KAM) chief executive Phyllis Wakiaga. President Uhuru Kenyatta has been at the forefront in pushing for deeper trade ties among African countries, driven by the realisation that Kenya will reap massive benefits, particularly in efforts to achieve industrialisation. When he joined other...

Five months after the East African Community deferred signing the controversial Economic Partnership Agreement with the European Union, it has emerged that Tanzania’s unyielding stance could force a stay of the status quo as the EU is hesitant to push the region to sign a trade deal that threatens its cohesion as a bloc. Well-placed sources at the European Commission told The EastAfrican that the EAC negotiated and concluded a bilateral trade agreement with the EU as a bloc, and it must remain as such. “All EAC members need to sign and ratify the agreement,” said the EC sources. The EPA gives EAC products total access to the EU market, with 82.6 per cent of imports from the EU allowed into the EAC market. The remaining 17.4 per cent of imports from the bloc — labelled “sensitive,” and largely consisting of farm and dairy products — would be progressively liberalised within 15 years from when the agreement comes into force. Kenya and Rwanda have signed the deal. However, Tanzania is unhappy about the trade pact, arguing that the agreement will have serious consequences for its revenues and the growth of its industries. Burundi refused to sign given its deteriorating relations with Europe. Uganda argued that signing the pact as individual countries would compromise the unity of the region, hence its decision to wait it out. Kenya has been lobbying its EAC partners to enforce the EPA on an individual basis rather than as a bloc to allow those that have not signed...

With 54 out of 55 African Union member states having signed the Africa Continental Free Trade Agreement (AfCFTA), the continent is on the verge of becoming the world’s largest free trade area which will merge the massive area into a single market of 1.2 billion people with a combined GDP of US$2.5 trillion (over N$35 trillion), according to the UN Economic Commission for Africa. However, local analysts have cautioned that the ambitious initiative is being hampered by issues such as non-tariff barriers, lack of financing and infrastructure problems. It has been estimated that that the Africa needs at least US$300 billion (approximately N$4,2 trillion) by 2020 to build quality infrastructure to facilitate the free trade agreement. “For continental trade to increase, substantial investment in infrastructure is required, not only in transport infrastructure, but in border infrastructure, in communication technologies so that business people can communicate easily across the continent, in financial infrastructure so that money can flow easily, in electricity infrastructure so that border posts can operate effectively 24 hours a day, etc. In addition, customs and other documentation should be unified to ease cross-border trade, as well as transport regulations such as axle loads, working hours of truck drivers etc,” commented Klaus Schade, a local economic analyst. Responding to questions from New Era, Schade added that trade across borders requires movement of people across borders, such as business persons, traders, truck drivers and so forth. “Namibia has taken the first step and embarked on visa on arrival, although the...

The success of the African Continental Free Trade Area (AfCFTA) will be measured largely by its ability to change lives, reduce poverty and contribute to economic development in Africa. This is according to the ninth edition of the flagship Assessing Regional Integration in Africa report (ARIA IX) launched during the African Business Forum. Expounding on the report, United Nations Conference on Trade and Development Secretary General Mukhisa Kituyi said that competition, investment and intellectual property rights are crucial requirements in the next phase of the agreement. He also urged the African business community to take ownership of the integration effort on the continent. The report highlights challenges facing regional integration which include limited energy and infrastructure development, insecurity and conflicts and limited financial resources among others. Going forward, the report says e-commerce is likely to be a significant driver and outcome of intra-African trade. “The public and private sectors are increasingly adopting e-commerce platforms. Governments deliver services through them, electronic marketplaces aggregate consumer and producer demand as well as trade-related services, traditional businesses have incorporated e-commerce into their business models and operations and individual entrepreneurs and small businesses use social media platforms to engage with market opportunities,” reads the report. Source: Capital Business

Rwanda parliament has ratified the 2015 Tripartite Free Trade Area (TFTA) agreement, a market of three regional blocs. TFTA brings together country members of the Common Market for Eastern and Southern Africa (COMESA), East Africa Community (EAC) and the Southern African Development Community. The ratification was passed this Wednesday without going through the commission scrutiny but came with debate on its importance, fears of duplication of the recently launched African Continental Free Trade Area (AfCFTA) worth $3.4 trillion. TFTA consists of a US$1.2 trillion free trade area, incorporating 26 African nations, with a population of 632 million people. The overall aim of the TFTA is to remove barriers to trade and to ease the movement of people between its signatory nations. Minister of Trade and Industry, Soraya Hakuziyaremye who presented the bill said “This agreement is very important to our export market since it introduces our country to a much wider market as it includes the Southern Africa Development Community of which we are not member.” At first, some members of parliament were hesitant to endorse it on ground that the agreement may be just a duplication of the already existing AfCFTA. “I sense an issue of duplication here. We should be sure that we would not loose taxes to these agreements,” MP Frank Habineza said. For MP Ignacienne Nyirarukundo, the AfCFTA was enough. MP Christine Muhongayire backed the idea of her colleagues but advised that parliament takes its time to assess the deal in the commissions. “It’s advisable to...

Local manufacturers are likely to benefit immensely from a newly implemented Africa-wide trade pact that provides access to a bigger market for their goods. The African Continent Free Trade Area (AfCFTA) protocol, launched at the Africa Union summit in Niger on Sunday after five years of deliberations, provides a single market of goods and services for 1.2 billion people with an aggregate Gross Domestic Product (GDP) of over $2 trillion (Sh200 trillion). ELIMINATE DEFICIT The adoption of the historic 55-nation agreement makes the whole continent a single market. Protocols will be aligned such that a Kenyan farmer can export avocado to Egypt duty-free, just as a Rwandese will be able to buy cocoa from Ghana. Kenyan manufacturers and exporters are upbeat that the trading bloc will be a boon for the country’s trade. Export Promotion Council chief executive Peter Biwott said Africa-wide trade, if well planned, could double the country’s exports, thereby eliminating the Sh1.15 trillion gap between exports and imports. “We import [goods worth] Sh1.7 trillion and we export Sh613 billion. The deficit can be eliminated if we increase our manufacturing and export enterprises. We target to get our exports to the mark of Sh2.3 trillion,” said Mr Biwott. Robust plan The government, he said, has a robust plan to make export trade efficient for existing enterprises as they recruit and train new ones in collaboration with the county governments. This is in a bid to scale up the range of products besides improving the manufacturing sector as a...

Infrastructure investment is one of the key pillars of the Agenda 2063 and for this to be achieved financing of these projects is still the continent’s biggest challenge. Rwanda’s Finance Minister, Dr. Uzziel Ndagijimana at the Africa 50 Summit joins CNBC Africa for more Source: CNBC Africa

On November 30, 2019, the East African Community (EAC) will be celebrating 20 years of existence. Lest we forget, it was on November 30, 1999 at Sheikh Amri Abeid Memorial Stadium in Arusha, Tanzania that three heads of state of the Republic of Uganda, the Republic of Kenya and the United Republic of Tanzania, put pen to paper to sign the treaty reviving the EAC. Again, to jog our memory, the EAC had earlier been established from 1967 and it collapsed 10 years later in 1977. The current EAC 20-year journey has been remarkable, the inevitable challenges notwithstanding. The framers of the Treaty establishing the EAC envisaged a community that would be anchored on four pillars. This is aptly captured in Article 5 where, the Partner States undertook “to establish among themselves, a Customs Union, a Common Market, subsequently a Monetary Union and ultimately a Political Federation”. The Partner States have signed and ratified three protocols in line with these pillars. Implementation of these protocols is at various stages with a commendable degree of success. The pillars are very crucial forerunners to the ultimate goal of Political Federation. Thus, in 2017, the EAC heads of state agreed on Political Confederation as a transitional model to full East African Political Federation. All the Partner States have, accordingly, nominated experts and set up a team that is currently working on the confederation constitution. Uganda’s former Chief Justice Benjamin Odoki and Makerere University’s Prof Murindwa Rutanga are part of this team. When asked...

President Kagame and Chairperson of the East African Community (EAC) has said that the implementation of the new African free trade area is an important step forward towards the unification of Africa. He was speaking at the 12th Extraordinary Summit of the African Union on Sunday in Niamey capital of Niger where he joined other Heads of State and Government from across the continent to launch the operational phase of the African Continental Free Trade Area (AfCFTA). He thanked Niger’s President Mahamadou Issoufou for the role that his country and him have played in signing the free trade area pact and hosting the participants in Niger to launch it. “History will record the central role played by the President of Niger, Mahamadou Issoufou, in bringing us to this point. Our task now is to finalise the remaining negotiations and operational instruments in a timely manner,” he said. Also discussed at the summit were key issues including the removal of non-tariff barriers and regulations controlling trade liberalization, rules of origin and the development of a digital payment system. Meanwhile, Nigeria honored the promise it had made earlier on Tuesday by signing up to the pact. President Muhammadu Buhari noted that free trade must also be fair trade. “As African leaders, our attention should now focus on implementing the AfCFTA in a way that develops our economies and creates jobs for our young, dynamic and hardworking population,” he said. Gabon and Equatorial Guinea have also joined making the number of countries that...