For those hoping that the implementation of the African continental free trade agreement would still take place this year, Secretary-General of the AfCFTA, Wamkele Mene has stated that as a result of the coronavirus pandemic, the agreement’s commencement date has been postponed till further notice.
“The Covid-19 situation has caused a major disruption. Governments are now engaged in a fight against the pandemic. It is obviously not possible to commence trade as we had intended on 1 July under the current circumstances,” Secretary-General Mene said.
“I think that’s the responsible thing to do,” Mene continued, “I don’t think it would be appropriate when people are dying to be focused on meeting the 1 July deadline. Instead, all governments should be allowed to concentrate their efforts on fighting the pandemic and saving lives at home.”
Here Is All You Need To Know
Here are The Key Points You Should Know About the AfCFTA Agreement:
- Prior to its being postponed, AfCFTA is a free trade agreement among African countries, who are signatories to the Agreement. The CFTA is consistent with the World Trade Organisation rules relating to Free Trade Agreements. A free-trade agreement is an agreement among a group of two or more countries whereby the duties and other restrictive regulations of commerce are eliminated on substantially all the trade between the countries in products originating from the countries.
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The Key Targets Of The Agreement
- The Agreement wants to create a single market for goods and services in Africa and to permit more people to move around any country in Africa with minimum visa requirements.
- It also seeks to create a market that is less free from custom duty and tariffs.
- It seeks to make movement of money and capital across African countries freer.
- The Agreement also hopes that, if it ever becomes successful, there would be established a Continental Customs Union that would be make issues of customs duty and levy less demanding in Africa.
- The Agreement seeks better ways of bringing more industries to Africa as well as opening up its agricultural and food sectors.
- The operational phase of the AfCFTA was launched during the 12th Extraordinary Session of the Assembly of the African Union in Niamey, Niger on 7 July 2019. The AfCFTA will be governed by five operational instruments, i.e. the Rules of Origin; the online negotiating forum; the monitoring and elimination of non-tariff barriers; a digital payments system and the African Trade Observatory.
- AfCFTA is an opportunity for countries and companies to help each other grow, as they have done in other regions. But trade liberalization has the potential to damage the poorest within those countries, which is why it is so important to have supportive policies. The speakers laid out several challenges and solutions.
Read also: More Revealing Facts About The African Free Trade Agreement
Though already in force legally, several details of the agreement still need to be deliberated on in phases as part of the process, with an initial July deadline set to start trading of goods and services under the new tariff. But the African Union can longer have its May meeting in South Africa to finalize the agreement, as earlier planned, due to disruptions caused by the coronavirus pandemic.
Read also:Border Closures Across Africa Threatens AfCFTA
A new date will be announced by the AU assembly for the implementation of the agreement, Mene said, with reports suggesting the new commencement date might be January 2021. “The political commitment remains, the political will remains to integrate Africa’s market and to implement the agreement as was intended,” the top official added.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
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