What Is Africa Free Trade Agreement

Eritrea has not signed because of tensions with Ethiopia, but after the 2018 Eritrea-Ethiopia summit, the AU Commissioner for Trade and Industry expects Eritrea to sign the agreement. [93] “In addition to the increase in GDP and trade figures, this contributes to the creation of jobs for the African youth population, in a very practical sense,” said Vera Songwe, Executive Secretary of the ECA, in an interview with Africa Renewal. Former Nigerian President Olusegun Obasanjo told Kigali media: “This is where our salvation lies: trade between them and therefore the development of our economies. This agreement will lead to a change in the perception of the continent by the rest of the world. Companies frustrated by trade barriers could use a “non-tariff barrier mechanism” in the agreement to signal commitments on trade problems and ask for solutions, Muchanga says. AfCFTA is the African continent`s most ambitious integration initiative, enshrined in the African Union`s Agenda 2063, whose main objective is to create a single continental market for goods and services with the free movement of people and investment, thereby expanding intra-African trade across the continent, strengthening competitiveness and supporting the economic transition in Africa. Forty-four countries initially signed the agreement on March 21, 2018. Nigeria was one of 11 African Union countries to avoid signing the treaty. At the time, Nigerian President Muhammadu Buhari said Nigeria could do nothing to undermine local producers and entrepreneurs. [53] The Nigerian Manufacturers` Association, which represents 3,000 Nigerian manufacturers, welcomed the decision to withdraw from the agreement.

[53] Nigeria`s foreign minister tweeted that more internal consultations are needed before Nigeria can sign the agreement. [54] Former President Olusegun Obasanjo said Nigeria`s delay was regrettable. [55] The Nigerian Labour Congress called the agreement a “renewed, extremely dangerous and radioactive neoliberal political initiative”, suggesting that increased economic pressure would push workers to rush into difficult and precarious conditions. [56] As of July 2019, 54 of the 55 African Union states had signed the agreement, with Eritrea the only country not to sign the agreement. Of these Member States, 27 have tabled their ratification instruments. [43] [44] Negotiations are under way with the African parties (Member States or REC) on Phase I protocols on trade in goods and services. Negotiations on Phase I protocols on competition, intellectual property rights and investments are expected to begin at the end of 2019. EU trade aid supports AfCFTA`s objectives, for example in West Africa, where a EUR 92 million programme aims to increase competitiveness and trade by using regional trade opportunities and creating a safe trading environment for small traders, especially traders.

Intra-African trade is currently only 16%, compared to 19% in Latin America, 51% in Asia, 54% in North America and 70% in Europe. The agreement was negotiated by the African Union (AU) and signed on 21 March 2018 by 44 of its 55 member states in Kigali, Rwanda. [15] [16] The agreement first requires members to remove tariffs on 90% of goods, allowing free access to goods, goods and services across the continent. [15] The UN Economic Commission for Africa estimates that the agreement will boost intra-African trade by 52% by 2022. [17] The proposal is expected to enter into force 30 days after ratification by 22 of the signatory states. [15] On 2 April 2019, The Gambia became the 22nd state to ratify the Convention[18] and on 29 April, the Sahrawi Republic tabled the 22nd filing of ratification instruments; The agreement entered into force on 30 May and entered its operational phase following a summit on 7 July 2019. [19] Beyond the effects of the pandemic, there is also the continent`s existing commercial architecture to overcome.

Written by darrenjac

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