Africa is on track to become the world’s largest free trade area as more countries continue to submit ratification instruments for the African Continental Free Trade Area Agreement.
Uganda has become the latest on the continent to submit the instruments of ratification of the African Continental Free Trade Area. The development was confirmed by Moussa Faki Mahamat, the Chairperson of the African Union Commission who is hopeful that other countries would follow suit.
Our goal for 22 signatures by 2019 on track as Uganda becomes 9th country to deposit instruments of ratification for #ACFTA! A further 12 countries have cleared parliamentary ratification,a key step towards depositing the full legal instruments of ratification. #TheAfricaWeWant pic.twitter.com/HvPnalBymd
— Moussa Faki Mahamat (@AUC_MoussaFaki) November 28, 2018
As of July 2018, six countries had submitted ratification instruments – Ghana, Kenya, Rwanda, Niger, Chad, and Eswatini (formerly Swaziland) with the expectation that many more would do so before the end of the year.
It was all pomp and pageantry in March 2018, when 44 African countries out of the 55 AU member states signed the vital continental free trade agreement in the Rwandan capital Kigali to enable the long-awaited economic integration and movement of goods and persons across member states.
This agreement was first introduced in January 2012 during the 18th Ordinary Session of the Assembly of Heads of State and Government of the African Union, held in Addis Ababa, Ethiopia. The member states adopted the decision to establish the Continental Free Trade Area by 2017.
The agreement is meant to create a single continental market for goods and services; enhance free movement of business persons and investments; enhance competitiveness at the industry and enterprise level through exploiting opportunities for full-scale production.
It will also bring together the 1.2 billion African population with a combined gross domestic product (GDP) of more than $2 trillion with the commitments of the countries to remove tariffs on 90 per cent of goods, with 10 per cent of “sensitive items” to be phased in later.
However, 11 countries at the time failed to sign the agreement for diverse reasons. The countries are Nigeria, South Africa (which later signed in July), Benin, Botswana, Burundi, Eritrea, Guinea-Bissau, Lesotho, Namibia, Sierra Leone and Zambia.
They are on the fence due to reasons including pressures from business leaders and labour unions who believe the agreement could affect their economies.
Five more countries signed the AfCFTA at the African Union (AU) summit in Mauritania in June, bringing the total number of countries committing to the agreement to 49 by the end of July.
But for the agreement to take effect, at least 22 countries must submit instruments of ratification to commence the process. Depositing the instruments of ratification means the country has undertaken all required internal legislative and legal measures in readiness to implement the agreement.
During the signing of the agreement in March this year, African Union Member countries set a deadline of 180 days to ratify the agreement through their respective legislative bodies.
The UN Economic Commission for Africa’s (ECA) Conference recently asked African nations to speed up the ratification and adoption process of the agreement with reasons that it is a powerful tool for driving industrialisation, economic diversification and development.
The agreement’s implementation could also boost intra-African trade from its current level of 16 per cent to 52 per cent by 2022, according to estimates by the ECA.