Home Business & TechEconomy How Far Is Eastern, Southern Africa On AfCFTA Implementation 

How Far Is Eastern, Southern Africa On AfCFTA Implementation 

by Daniel Sabiiti
3:32 pm

Participants at EABC-TMEA consultative meeting in Kigali this week

The Eastern and Southern Africa Regional Business Councils on the African Continental Free Trade Area (AfCFTA) agreement have agreed to move from rhetoric to action in implementing the trade deal.

The AfCFTA was signed in 2018, in Kigali, Rwanda and 44 African member states agreed to implement the deal so as to tap into the continent’s trade opportunities and bolster intra-Africa trade towards achieving the AU development agenda 2063.

The AfCFTA officially kicked off in January 2021 with only 36 countries (to date) having been able to sign and deposit their instruments of AfCFTA ratification with the African Union Commission (AUC).

To move the agenda forward, each regional bloc in Africa was tasked to form a Regional Business Councils (REC) and so far eight have been formed, including the Eastern and Southern Africa REC tripartite- which brings together the East African Business Council (EABC), Common Market for Eastern and Southern Africa (COMESA) and Southern African Development Community (SADC).

Though six African countries, including Rwanda have been chosen to pilot regional trade in selected goods, one of the major challenges is that a number of trade instruments had not been finalized.

Officials said there has been no action on outcomes of the 1st coordination meeting of the Heads of Regional Economic Communities on the implementation of AfCFTA held in September 2021, in Accra-Ghana.

To move from paperwork to action, the regional tripartite which met in Kigali from 10th – 11th August, 2022 recognized the role of private sectors in implementing the deal and came up with strong recommendations on how to move forward.

These include having an Action Plan for Collaboration between the RECs Business Councils on capacity building of the private sector to participate in the AfCFTA initiatives, create a joint coordination on the sensitization of the private sector to benefit from the opportunities presented by the AfCFTA, and established engagement mechanism between African Business Council and the RECs Business Councils.

Regional Gaps

The latter issue was the most contentious aspect as tripartite members differed on whether to push their own tripartite council or form a new Africa continental tripartite council keeping in mind that there is an African Business council- which is recognized by AU but not a legal or registered entity.

Jean Bosco Kalisa, the CEO of EABC

Dennis Karera, EABC Vice Chairman &AfCFTA Focal Point Rwanda said that the regional business body can form a continental council that is proactive and inclusive.

“I don’t see why we cannot start this process now, so as to have a council that is inclusive and representative of all legally recognized regional business councils,” Karera said.

“The longer we wait the more room we are going to create for other organizations to pop up. Otherwise some Asian will come and create a group that we don’t know.”

However, Dickson Poloji, CEO of COMESA Business Council said that they don’t want to start a fight with the existing Africa business council.

Africa has a market of 1.3 billion consumers with a total Gross Domestic Product (GDP) of more than $2.6 trillion and $80billion in intra-Africa exports.

The World Bank predicted economic benefits of full AfCFTA implementation by 2035 to a 7% real income gain ($450 billion), 29% increase in volume of exports, and 81% increase in intra-African trade, lifting over 60 million from poverty.

The first phase of the AfCFTA was supposed to see implementation of trade in goods and services, setting rules and procedures on the settlement of disputes, tariff concessions, specific commitments for trade in services, and rules of origin.

However, with 70% of intra-regional trade potential, Karera questioned why the SADC bloc doesn’t trade much with the east but prefers the western.

 “We need to see the role of the private sector without delay. Why is it that we still have trade barriers, closed air spaces in the region?”

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