Search for common import rules to test Africa free trade area

African nations are headed for another round of tough negotiations as they seek common rules for their newly formed free trade area even after they settled the headquarters question on Friday.

To achieve its goal of boosting intra-regional trade, the African Continental Free Trade Area (AfCFTA) must craft rules of origin (RoO) that encourage imports from members while slowing orders from outside the bloc.

A committee of experts is currently working on RoOs to be applied by all the AfCFTA signatories in a move set to test old commercial ties with French and English speaking European countries. “We expect this to be an area for some tough negotiations,” said Chris Onyango, a consultant with the United Nation Conference on Trade and Development (UNCTAD).

“But there is a starting point as all the regional economic blocs in the continent already have RoOs which the committee may decide just to harmonise.”

The Common Market for East and Southern Africa – where Kenya and most of its East African neighbours belong – for instance has its own RoO.

The RoOs only permit goods that are either fully produced within the member states or imports with local value addition accounting for at least 35 per cent of the ex-factory cost.

Other regional blocs are the Economic Community of West African State (Ecowas) and the Gaborone-headquartered Southern African Development Community.

"If successfully implemented, AfCFTA could generate a combined consumer and business spending of $6.7 trillion by 2030, accelerate, expand economic diversification and facilitate job creation for women and youth,” tweeted African Union Commission deputy chair Kwesi Quartey

On Sunday, African leaders attending the AU Extra-Ordinary Summit in Niamey, Niger, launched the AfCFTA and directed its secretariat to start working on removing barriers to trade.

The Executive Council of the African Union, comprising ministers for Foreign Affairs, on Friday settled on Ghana’s capital Accra as the seat for the secretariat, a decision that was approved by the Heads of State and Governments in Niamey on Sunday.

“Today the 7th July, 2019, will be remembered as the day Africa achieved another historic milestone of uniting Africa for collective prosperity, peace and harmony,” the AfCFTA secretariat tweeted as heads of state launched the bloc’s operational phase.

Kenya which like Ghana were the first states to ratify AfCFTA on May 10, 2018 was unsuccessful in its bid to host the bloc’s secretariat. Other countries which had shown interest were Egypt, Eswatini (formerly Swaziland), Ethiopia, Madagascar and Senegal.