African Continental Free Trade Agreement

African Continental Free Trade Agreement (AfCFTA)
Status as of 7 October 2019
  Ratifying parties
  Signed March 2018, not ratified
  Signed July 2018 or later, not ratified
TypeTrade agreement
Signed21 March 2018
LocationKigali, Rwanda
Effective30 May 2019
ConditionRatification by 22 states
Original
signatories
Signatories
Parties
DepositaryAfrican Union Commission
LanguagesEnglish, French, Portuguese, Arabic, Spanish

The African Continental Free Trade Agreement (AfCFTA) is a trade agreement which is in force between 27 African Union member states.[1][8][9][10] It was signed in Kigali, Rwanda, on 21 March 2018. As of July 2019, 54 states have signed the agreement.[11] Ratification by 22 countries was required for the AfCFTA to enter into force and the African Continental Free Trade Area to become effective. The agreement will function as an umbrella to which protocols and annexes will be added.

Negotiations continued in 2018 with Phase II, including Competition Policy, Investment and Intellectual Property Rights. A draft shall be submitted for the January 2020 AU Assembly.[12]

Kenya and Ghana were the first countries to deposit the ratification instruments on 10 May 2018, after ratification through their parliaments.[2] With ratification by Sierra Leone and the Sahrawi Republic on 29 April 2019, the threshold of 22 ratifying states for the free trade area to formally exist was reached.[7] As a result, the AfCFTA came into force on 30 May 2019. Outstanding issues like the trade concession agreements and rules of origin remain under negotiation. On 7 July 2019, at a summit in Niger, the AfCFTA entered its operational phase.[13][14]

History

Background

In 1963, the Organization of African Unity (OAU) was founded by the independent states of Africa. The OAU aimed to promote cooperation between African states. The 1980 Lagos Plan of Action was adopted by the organization. The plan suggested Africa should minimize reliance upon the West by promoting intra-African trade. This began as the creation of a number of regional cooperation organizations in the different regions of Africa, such as the Southern African Development Coordination Conference. Eventually this led to the Abuja Treaty in 1991, which created the African Economic Community, an organization that promoted the development of free trade areas, customs unions, an African Central Bank, and an African common currency union.[15][16]

In 2002, the OAU was succeeded by the African Union (AU), which had as one of its goals to accelerate the "economic integration of the continent".[17] A second goal was to "coordinate and harmonize the policies between the existing and future Regional Economic Communities for the gradual attainment of the objectives of the Union."[18] At the 2012 African Union summit in Addis Ababa, leaders agreed to create a new Continental Free Trade Area by 2017. At the 2015 AU summit in Johannesburg, the summit agreed to commence negotiations. This began a series of ten negotiating sessions which took place over the next three years.[15][19]

2018 Kigali Summit

In 2018, at the 10th Extraordinary Session of the African Union on AfCFTA, three separate agreements were signed: the African Continental Free Trade Agreement, the Kigali Declaration; and the Protocol on Free Movement of Persons. The Protocol on Free Movement of Persons seeks to establish a visa-free zone within the AfCFTA countries, and support the creation of the African Union Passport.[20] At the summit in Kigali on 21 March 2018, 44 countries signed the AfCFTA, 47 signed the Kigali Declaration, and 30 signed the Protocol on Free Movement of People. While a success, there were two notable holdouts: Nigeria and South Africa, the two largest economies in Africa.[21][22][23]

One complicating factor in the negotiations was that Africa had already been divided into eight separate free trade areas and/or customs unions, each with different regulations.[note 1] These regional bodies will continue to exist; the African Continental Free Trade Agreement initially seeks to reduce trade barriers between the different pillars of the African Economic Community, and eventually use these regional organizations as building blocks for the ultimate goal of an Africa-wide customs union.[15][23][24][25]

Declarations signed at the 2018 Kigali summit[26]
Country Signed By afCFTA Consolidated Text (signature) Kigali Declaration Free Movement Protocol
 Algeria Prime Minister Ahmed Ouyahia Yes Yes No
 Angola President João Lourenço Yes Yes Yes
 Central African Republic President Faustin Archange Touadéra Yes Yes Yes
 Chad President Idriss Déby Yes Yes Yes
 Comoros President Azali Assoumani Yes Yes Yes
 Djibouti President Ismaïl Omar Guelleh Yes Yes No
 Equatorial Guinea Prime Minister Francisco Pascual Obama Asue Yes Yes Yes
 Eswatini Prime Minister Barnabas Sibusiso Dlamini Yes Yes No
 Gabon President Ali Bongo Ondimba Yes Yes Yes
 Gambia President Adama Barrow Yes Yes Yes
 Ghana President Nana Akufo-Addo Yes Yes Yes
 Ivory Coast Vice President Daniel Kablan Duncan Yes No No
 Kenya President Uhuru Kenyatta Yes Yes Yes
 Lesotho Prime Minister Tom Thabane No Yes Yes
 Mauritania President Mohamed Ould Abdel Aziz Yes Yes Yes
 Morocco Prime Minister Saadeddine Othmani Yes No No
 Mozambique President Filipe Nyusi Yes Yes Yes
 Niger President Mahamadou Issoufou Yes Yes Yes
 Republic of the Congo President Denis Sassou Nguesso Yes Yes Yes
 Rwanda President Paul Kagame Yes Yes Yes
 Sahrawi Arab Democratic Republic President Brahim Ghali Yes Yes No
 Senegal President Macky Sall Yes Yes Yes
 Seychelles Vice President Vincent Meriton Yes Yes No
 South Africa President Cyril Ramaphosa No Yes No
 Sudan President Omar al-Bashir Yes Yes Yes
 Tanzania Prime Minister Kassim Majaliwa No Yes No
 Uganda President Yoweri Museveni[27] Yes Yes Yes
 Zimbabwe President Emmerson Mnangagwa Yes Yes No

Ratification

After the Kigali summit, more signatures were added to the AfCFTA. At the African Union summit in Nouakchott on 1 July 2018, five more nations joined the agreement, including South Africa. Kenya and Ghana were the first nations to ratify the agreement, depositing their ratifications on 10 May 2018. Of the signatories, 22 needed to ratify the agreement for it to come into effect, and this occurred on 29 April 2019 when both Sierra Leone and the Saharawi Arab Democratic Republic ratified the agreement. As a result, the agreement came into force 30 days later on 30 May 2019; at this point, only Benin, Nigeria, and Eritrea had not signed. Eritrea was not part of the initial agreement due to an ongoing state of war, but the 2018 peace agreement between Ethiopia and Eritrea ended the conflict and ended the barrier to Eritrean participation in the free trade agreement.[8][23][28][29][30] The unrecognized state of Somaliland was not a party to the discussions related to the creation of the agreement.

The 12th Extraordinary Session of the African Union on AfCFTA was called to launch the new agreement, which was hosted in Niamey on 7 July 2019. At this summit, Benin and Nigeria signed the agreement, leaving Eritrea as the only African state not a part of this agreement; Eritrea has since asked to join the agreement. Gabon and Equatorial Guinea also deposited their ratifications at this summit. At the date of the launch, there were 27 states who had ratified the agreement.[8][28][30][31][32]

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