What Is The African Continental Free Trade Area Agreement

To what extent could AfCFTA contribute to intra-African trade? As noted above, it will take a long time for the economic impact to be felt. According to the IMF, the liberalization of 90% of trade within the AfCFTA would result in a relatively modest 16% increase in trade. The reason is that 90% of liberalisation may seem impressive, but in reality it is not very ambitious. In most countries, most imports are already duty-free; In Namibia, for example, it is about 60%. Therefore, if 10% of products are excluded from tariff reductions, the most dynamic categories may be excluded. Economists Peter Draper and Andreas Freytag go so far as to prevent the AfCFTA from achieving real significant liberalization. The SAfCFTA secretariat is responsible for coordinating the implementation of the agreement and is an autonomous body within the AU system. Although it has an independent legal personality, it will work closely with the AU Commission and receive its AU budget. The Council of Ministers responsible for trade will decide on the headquarters, structure, role and responsibilities. [35] The African Union Assembly of Heads of State and Government is the highest decision-making body. It will probably meet during the AU summit. [39] The Council of Trade Ministers provides strategic trade oversight and ensures the effective implementation and implementation of the AfCFTA agreement.

[39] Economic Integration Forecasting Models General Balance Models Trade Agreements Open Economies Structural Reforms Barriers to Trade Finance Trade Negotiations Cleanse welfare Paul Brenton is a leading economist in the World Bank`s Trade and Regional Integration Unit (ETIRI). It focuses on analytical and operational work in the area of trade and regional integration. Yulia Vnukova advises the World Bank in the Department of Trade and Regional Integration (ETIRI). Based on more than a decade of experience, Yulia`s current work focuses on trade policy and regional integration, focusing on macroeconomic and microeconomic analyses of trade, trade and sectoral competitiveness, global value chains and private sector development in emerging countries in Europe, Asia and Africa. The negotiations and establishment of afCFTA have since generated some momentum and the expectation, both inside and outside Africa, of achieving real economic results. However, there are two real dangers, especially given the disappointing balance of liberalization efforts so far in some regions. First, decisions to reduce tariffs do not necessarily need to be implemented. Second, definitions and obligations could be so unambitious that even implementation could lead to small changes in real trade, for example when the rules of origin are very strict or if the exceptions are very generous.

Significant efforts to achieve meagre results would be the worst result and would put an end to further liberalisation. The AfCFTA aims to liberalize trade in services and goods. But discussions about services are only at the beginning, so the form of the outcome and the possible effects are not yet predictable. African states and regional organizations have even less experience in negotiations on services than with those on opening up trade in goods, and therefore the challenges are significant.