Ramaphosa to join other African leaders in signing the African Continental Free Trade Area Agreement
President Cyril Ramaphosa is joining other African leaders for the inauguration of what is billed as the world’s largest free-trade zone, due to take place on Wednesday, when heads of state in the African Union (AU) sign the African Continental Free Trade Area (AfCFTA) agreement.
Presidents, prime ministers, high-level officials and private-sector stakeholders are all in Rwanda’s capital for the AU’s 10th extraordinary summit of the heads of state and government. The meeting includes a business summit of panel discussions to be held on Tuesday under the theme, "Leveraging the power of business to drive Africa’s integration".
The AfCFTA looks to facilitate the free movement of goods and services as a precursor to the establishment of the African Customs Union. It features a host of measures and institutional frameworks to foster intra-Africa trade through the elimination of tariffs, the harmonisation of customs protocols, and the development of regional supply chains.
"AfCFTA will make Africa one of the largest economies in the world and enhance its capacity to interact on equal terms with other international economic blocs," commented AU Commission chairperson Moussa Faki Mahamat.
The AU’s executive council met over the weekend to finalise the legal and institutional frameworks for the free-trade zone, including a dispute settlement mechanism and protocols pertaining to the liberalisation of 90% of goods in the customs union.
About 46 countries are expected to sign on, comprising 29 presidents and 17 vice-presidents as signatories. Ramaphosa is expected to be in Kigali, along with International Relations and Co-operation Minister Lindiwe Sisulu, the Department of Trade and Industry’s Rob Davies, and his deputy Gratitude Magwanishe.
After Wednesday’s signing, phase two of the negotiations will kick off towards the end of 2018 and will entail thrashing out the details of investment requirements, rules of services trading, competition, and intellectual property rights.
The AfCFTA will be the second flagship project signed this year after the Single Air Transport Market, and forms part of the body’s larger continental economic integration plan enshrined in the AU’s developmental Agenda 2063.
The free-trade zone will span all the AU’s 54 member states, comprising 1.2-billion people and a combined GDP of $3.4-trillion. Intra-Africa trade accounts for a mere 16% of the continent’s total trade, compared to more than 70% of intra-regional trade seen in Europe.
The UN’s Economic Commission for Africa reckons that eliminating import duties alone could see AfCFTA boosting intra-continental trade by 52.3%.
Implementation of AfCFTA will go hand in hand with the union’s action plan on Boosting Intra-Africa Trade (BIAT), which aims to double trade flows by 2022.