- The Secretary General of the African Continental Free Trade Area Secretariat says the goal has been set that free trade agreement must be implemented on 1 January 2021.
- The agreement was supposed to become effective from 1 July 2020 but was delayed by Covid-19.
- Mene said the agreement is the only immediate tool Africa has at its disposal to boost economic recovery from the Covid-19 fallout.
Wamkele Mene, Secretary General of the African Continental Free Trade Area Secretariat told delegates at the annual competition law, economics & policy conference on Wednesday that the Secretariat was at advances stages of concluding phase one of the agreement which deals with the trading of goods and services.
While understandably not all countries will be ready to trade under the African Continental Free Trade Area (AfCFTA) terms from day one, Mene said the Secretariat was "determined" to get this off the ground from the first day of the year and those countries who lag will hopefully staring start moving together with the rest soon after that.
Moene said 28 countries on the continent have already deposited their instrument to establish customs infrastructure so that trade can take place meaningfully. And soon after it starts, the countries will commence negotiations on competition policy to ensure that the free trade policies will be fair to member countries and their vulnerable industries.
The agreement was supposed to become effective from 1 July 2020, but this was delayed by Covid-19 as most countries in the continent went under partial or full lockdown.
"We have now resumed our work. We are now negotiating virtually. We are meeting in person where we can, to ensure that we are ready to commerce trading under the AfTA preferences from the 1st of January 2021," said Mene.
The told the conference that the AfCFTA was possibly the last chance for Africa to move forward with an integrated market in in the continent and overcome "smallness" of its individual economies as well as reliance on export of commodities.
The agreement has ambitious targets – to double the value of intra-Africa trade from the current 18% by 2035 and increase intra-continental trade volumes by at least 80%. Mene said while this looks ambitious, it is attainable when one looks at intra-continental trade in other areas around the globe. For instance, intra-European trade stands at over 70%. Intra-North American trade is over 60% and intra-South Asia trade is over 36%.
Mene said doubling intra-Africa trade was crucial for economic recovery caused by Covid-19 and to reduce the continent's vulnerability that the pandemic has exposed.
"This is Africa's economic recovery tool. Aggressively implementing this agreement so that it is the driver of economic activity in the continent, year-on-year from 2021, I don't believe we have an alternative. There are not many companies in the continent to provide these significant bailouts we have seen and the economic recovery packages we have seen."
Mene said the Secretariat understood that it was going to be a difficult and will take a long time to achieve full regional and market integration as well as harmonisation of laws.
"But boosting intra-Africa trade is the immediate tool we have at our disposal. That is why we are redoubling our efforts to implement this agreement," he said.