While the African Union (AU) has developed ambitious plans for continental free trade it is becoming clear that free movement of people lags behind. This blog identifies six obstacles that impede progress on free movement for people in Africa and considers the prospects for future development. The AU Summit held in Niger on July 7 2019 witnessed the rapid ratification of the African Continental Free Trade Area (AfCFTA). One of the most rapidly ratified and fastest treaties to enter into effect (it took little more than a year from inception), AfCFTA has now been ratified by 27 African countries, including Egypt, Ethiopia, Kenya, South Africa and Ghana, although Nigeria, Algeria, Tanzania and some others have not yet ratified the agreement. Remarkably, at that Summit the Protocol for a Free Movement of Persons was once again missing from the agenda. Intertwined as they must be if they are to operate effectively, the free trade treaty should have been ratified and implemented hand in hand with arrangements for the free movement of people under the Protocol on Free Movement for Africa, adopted by the AU in January 2018. Unfortunately, only four countries (Madagascar, Niger, Rwanda and Sao Tome & Principe) have signed up to the latter arrangement; none of the bigger countries, such as Algeria, Egypt, Nigeria, South Africa and Ethiopia, have ratified it. According to the African Development Bank’s Africa Visa Openness Report 2018, African citizens need a visa to travel to 51% of other African countries, 24% demand a visa on arrival and only 25% operate...

He urged Japan to learn from the example of the Tony Elumelu Foundation, which champions empowering African entrepreneurs, as the most sustainable means of accelerating the development of Africa. “At TICAD 2016 in Kenya, Japan pledged $30b (sh110.5 trillion) for Africa. This year you have generously increased this to $50b (sh184.2 trillion),” Elumelu said. “If we invested just 5% in Africa’s new generation of entrepreneurs, following my Foundation’s robust, proven model of getting capital directly to those best placed to catalyze growth and create real impact, we could touch 500,000 lives, across the 54 African countries, broadening markets, facilitating job creation, improving income per capita, and laying the key foundation for political and economic stability”, he added. Elumelu’s statement captured his vision of a relationship between Japan and Africa, which prioritises economic and shared prosperity. He outlined the three key pillars of a bold and transformative structure: investment in infrastructure, partnership with the African private sector, and investment in Africa’s youth. He urged Japan to learn from the example of the Tony Elumelu Foundation, which champions empowering African entrepreneurs, as the most sustainable means of accelerating the development of Africa. The Tony Elumelu Foundation, in just five years has assisted over 7,500 African entrepreneurs across every Africa, with seed capital, capacity building, mentorship and networking opportunities through its $100 million Entrepreneurship Programme. Elumelu’s advice carried the weight of his track record of business success, founding Africa’s global bank, United Bank for Africa (UBA), which has grown its presence to 20...

Globalisation, which has driven economic growth but has also been criticised for leading to unacceptable levels of inequality, will be high on the agenda at the 28th World Economic Forum (WEF) on Africa tomorrow. The WEF said in a statement yesterday that it would also discuss government policies and responsible business practices to provide a foundation for a more inclusive society. It said tackling corruption, universal healthcare provision and the protection of workers in the gig economy had a role to play in building more equitable societies. This year’s WEF on Africa will convene 1100 leaders from 100 countries, representing business, government, academia, civil society, media and the arts under the theme “Shaping inclusive growth and shared futures in the 4th Industrial Revolution (4IR)”. Elsie Kanza, the head of Africa at the forum, said top leaders would come together to create the conditions for socio-economic investment to take place. “Africa, like all regions of the world, faces great challenges. "For the region to prosper in an increasingly globalised world, it needs transparent governance, competitive economies and peaceful societies.” Heads of state or governments participating in the meeting include President Cyril Ramaphosa; Mok- gweetsi Masisi, President of Bo- tswana; Azali Assoumani, President of the Union of the Comoros; Ma- ndulo Ambrose Dlamini, Prime Minister of eSwatini; Sahle-Work Zewde, President of Ethiopia; Peter Mutharika, President of Malawi; Hage Geingob, President of Namibia; Yemi Osi- nbajo, Vice-President of Nigeria; Yo- weri Museveni, President of Uganda; Danny Faure, President of Seychelles; and Emmerson Mnangagwa,...

Africa's tripartite free trade area (TFTA) will be operational in early 2020, an official said on Tuesday. Francis Mangeni, director of trade and customs with the Common Market for Eastern and Southern Africa (COMESA) told Xinhua in Nairobi that so far five countries have ratified the TFTA that brings together COMESA, East African Community (EAC) and the Southern African Development Community (SADC) trading blocs. "We expect another 11 countries to ratify the agreement before the end of the year so that the TFTA could be operationalized," Mangeni said on the sidelines of the sixth COMESA annual research forum. The five-day event will bring together policymakers, academia, think tanks, and the private sector from the 21 member states to discuss emerging topical issues in regional integration. Mangeni said that the TFTA will also be a building bloc for the African Continental Free Trade Area. The COMESA official added that East African Customs Union and Southern African Customs Union have already completed negotiations on tariff reductions. He noted that countries that are not members of either EAC or SADC will use the current trade liberalization trade regime of COMESA. Mangeni revealed that the ultimate aim of the TFTA is to reduce gradually the tariffs for all goods traded in the bloc to zero percent. "In the first year of operations countries (are) to fully liberalize trade on 66 percent of all goods and achieve 100 percent in five years," he said. Source: China Org

Plant and animal products traded across the world are subjected to global standards under what is known as Sanitary and Phytosanitary (SPS) measures set by the World Trade Organisation (WTO), a body that deals with global rules of trade. These measures are generally meant to protect human, animal and plant health from risks arising from contaminants, toxins, additives, or disease organisms. They are also meant to protect animal or plant life from pests, diseases, and disease-causing organisms. In essence, if a Rwandan trader exports fruits to the European market or any other market, the products are usually subject to inspection to check if they live up to those standards. In other markets, the products will be subject to testing of packaging and labeling standards, processing methods and certification. In many cases, countries with stronger SPS standards tend to trade less with countries that have weaker SPS standards. More developed nations normally have stronger standards and demand a lot from less developed countries and less developed countries end up being victims. For instance, between 1995 and 2017, developed countries raised 242 SPS trade concerns as opposed to only 7 concerns raised by least developed countries. 226 measures were maintained as opposed to only 1 measure, according to WTO. Rwanda has particularly experienced these issues as exporters of food and other agricultural products have had their products rejected at the borders of the European Union country, the country's largest export destination of horticulture products. According to data from the Ministry of Agriculture,...

Africa's largest trading bloc plans to promote intra-regional trade through innovation, an official said on Monday. Kipyego Cheluget, assistant secretary-general, Common Market for Eastern and Southern Africa (COMESA) told a regional trade forum in Nairobi that innovation creates technological and comparative advantage, which in turn drives trade. "Regions with robust innovation activities have higher productivity, economic growth and job creation and have more government revenues available to support spending in core public priorities such as health, education and infrastructure," Cheluget said during the opening ceremony of the sixth Comesa annual research forum. The key objective of the five-day event was to bring together academia, think tanks, government officials and the private sector from the 21 member states to discuss emerging topical issues in regional integration. Cheluget said that members of the economic bloc recognize the importance of science, technology and innovation in socio-economic and cultural development and have agreed to cooperate in the various fields. Chris Kiptoo, principal secretary of Kenya's Ministry of Industry, Trade and Cooperatives said that a more integrated region will enhance economic growth and poverty reduction in eastern and southern Africa. Kiptoo said that the best way to achieve productivity growth is through greater innovation, which can be defined as the development of new or improved products, services and processes. He noted that the region's average high growth rate has not been accompanied by high job growth rates in the face of a rapidly growing population. Source: Xinhau

The African Continental Free Trade Area (AfCFTA) came into effect last May 30, with 54 states signing the agreement at the time of writing. This pan-African agreement was made in the hopes of bolstering local economies by breaking down existing trade barriers and reducing tariffs for regional exchange. Nigeria has just signed onto this agreement — a monumental feat considering that the country represents Africa’s largest economy. About the agreement The AfCFTA is poised to be the world’s largest trading bloc. This bloc will economically join over a billion people, with experts hoping that this will speed up modernisation efforts across the continent. Africa’s labour force has been steadily growing, and with the businesses promoted by the AfCTA creating new jobs, there will be further growth. The beginnings of the AfCFTA started in 2012, when leaders at the African Union summit began grappling with the idea of free trade across Africa. Negotiations officially began during the 2015 summit, and a total of ten negotiating sessions were held before reaching the final agreement in 2018. Experts estimate that this agreement will kick-start Africa’s growth on its way to become a huge economic player. Possible developments include free movement of people across the continent’s borders and the adoption of a single currency. What does this mean for intra-African business? Africa News reports that trade between African countries is the continent’s weak spot, citing lack of infrastructure and investment. They estimate that about $300 billion will be needed by 2020 in order to build...

African political and business leaders at the World Economic Forum in Cape Town will be urged to follow through with commitments made to regional integration, trade experts say. As the African Continental Free Trade Agreement (AfCFTA) enters the implementation phase, WEF Africa can jumpstart discussions on the process of dismantling barriers to regional trade, says co-chair Arancha González Laya. “I hope to shine a spotlight on integration of the African market, because it is very important to keep the momentum that has been generated with the launch of the African Continental Free Trade Agreement,” says González. “What’s important is that the negotiators don’t drop the pen the day the agreement has been signed. The most important phase starts now and it’s called implementation.” The road less travelled African countries have traditionally sold raw materials to global powers rather than trade among themselves. As the only continent in the world trading more externally that internally, Africa is missing out, González says. “Essentially Africa is to a large extent trading outside the continent in lower value-added raw materials and commodities and it’s foregoing the opportunity to trade more value-added [products] within the African continent. We know that what Africa trades within its borders has more value-added than what it trades outside its borders. So it’s important that Africa finds a way to better integrate its markets, to provide opportunities for all those entrepreneurs that can build the regional value chain.” Within the new economic zone, 90% of tariffs would be scrapped within...

Trade and political disputes between member states of the East African Community (EAC) are resulting into an increase in Non-Tariff barriers and other hindrances to trade in the region. To find out solutions, Kenneth Bagamuhunda, Director General of Customs and Trade at the East African Community joins CNBC Africa for more. Source: CNBCAfrica

Trade activity is rooted in basic supply and demand. The female population is estimated to account for 50% of Africa’s total population, and so it is essential to consider women when deliberating on implementation of crucial policies such as the Africa Continental Free Trade Area (AfCFTA) agreement. The AfCFTA aims to create a single continental market for goods and services in member nations of the African Union. It is expected to be the largest global trade bloc, consolidating a market of 1.3 billion consumers with a combined GDP of about $3.3 trillion. Africa could add at least 4.5% to that on the back of enhanced trade activities, according to the Africa Development Bank. The role of women in driving general consumption patterns cannot be overemphasized. Across households, women are more likely to spend their income on products and services that will benefit the smooth running of their homes. Evidence from a range of countries shows that increasing the share of household income controlled by women, either through their own earnings or cash transfers, changes spending patterns that benefit children. Industry sources suggest that women reinvest 90% of their income back into their families, while men reinvest only 30-40%. Therefore, women have a critical part in achieving the desired demand boost that would support the exchange of goods and services among countries throughout the AfCFTA. In most of the African countries signed up to this agreement, the agriculture sector is a primary driver. The contribution of women to the agricultural labour force ranges between...