It will be erroneous to think that the official commencement of the African Continental Free Trade Agreement (AfCFTA) on January 1, 2021, has been rushed since it is not an event but a process, Wamkele Mene, the AfCFTA’s Secretary General, has said.
Responding to critics who opine that the agreement’s implementation was rushed, Mr. Mene noted that the task to ensure an integrated market by African countries “has and would always be a process and not an event,” and as a result, the secretariat could not have waited for perfect circumstances before rolling out on January 1.
Mr. Mene, at a recent press briefing on the state of the AfCFTA since it officially commenced operation, explained that just as it took Europe some 60 years to achieve its current state of integration, Africa would have to start from somewhere and build on its successes while addressing challenges that will pop up.
“In some parts of the world we get criticism. We get criticized and we are told that we are rushing things and that we are not quite ready. But I want to ask those who hold that view, tell me of a trade agreement where all countries are ready at the same time. I don’t know yet. I have never heard of a trade agreement, where in that particular arrangement, every single country is ready on day one.
Not to my knowledge, it doesn’t exist. And so, I regret that as Africans we are held to a much higher standard to how trade agreements should operate in practice. We negotiated this agreement in record time and we are still continuing with negotiations, but there have been other arrangements that have taken much more than us to negotiate and to enter into force. There are other agreements and negotiations that have been going on for decades, and we have been able to do this in less than five years,” Mr. Mene said.
He added that Africa is in no rush with any bloc of the world and would pursue its integration at its own pace.
“We are not doing it because we want to prove anything to anyone outside the African continent. We are doing it because it is in Africa’s interest to have an integrated market and so to the extent that there is something that we have to demonstrate and prove, and it is to 1.2 billion Africans that we shall and are committed to an integrated market and that January 1, 2021 was the start of that process.”
So far, 54 African nations have committed to join AfCFTA with 33 countries ratifying the agreement but many of those that have ratified lack the customs procedures and infrastructure to facilitate tariff-free trade. Despite the lack of these procedure, Mr. Mene, is bullish the process of integration will continue unabated.
“There will be countries and there are countries who have the requisite customs infrastructure in place today as we speak who are trading under the AfCFTA and there are countries who are in the process of establishing those customs procedures that are required. But traders will not be penalized; there would be a system where you will be credited for the trade that is taking place since January 1, 2021 and the credit may come in the form of a duty that is reduced, it is entirely up to the member states to decides how that credit will be or the reinvestment will be provided.”
He outlined some mechanisms being recommended to address the challenge. “Some of the options we have considered are the establishment of an account from which later exporters can draw down for their reinvestment in recognition of the fact that we are trading with new rules which are preferential rules.
This mechanism that we are talking about of reinvesting exporters is not a new invention, various trade agreements around the world where there’s a time line between the rectification and implementation of the agreements, it has been done before. It’s not a reinvention of the wheel, we are using modules that have been used before in other parts of the world in other trade agreements.”