Coronavirus: Implementation of AfCFTA faces delay

Approval of phase one operational instruments required for the start of duty free trading within the Africa Continental Free Trade Area (AfCFTA) in July this year hangs in a balance following the continuous impact of the novel Coronavirus Disease (COVID-19) infections that has brought global activities to a standstill.

Despite the swearing-in ceremony of the first Secretary-General of AfCFTA, Wamkele Mene last week in Ethiopia – an event which should have been held in Accra on 31st March, 2020 – the growing list of cancellations and postponements of various activities this year because of COVID-19 could potentially delay implementation of AfCFTA in July.

Following the 2nd meeting of AfCFTA Council of Ministers held in December last year in Accra, it was agreed that AfCFTA Council of Ministers should meet in South Africa for an Extraordinary Summit on 30 May 2020 to approve all instruments under the agreement.

The Executive Council of the African Union (AU) had earlier directed the AU Commission to convene the necessary meetings to conclude remaining work on Rules of Origin, schedules of tariff concessions and schedules of specific commitment on the five priority service sectors by end of March 2020 to enable the finalization of tariff offers and submission of the final report on Rules of Origin to the Extraordinary Summit in South Africa.

However, as the rate of COVID-19 infections continue to surge on the continent which has forced countries to take some drastic decisions including travelling restrictions among others, it is likely that the Extraordinary Summit will be postponed.

The operational instruments include Rules of Origin, which will determine the eligibility of goods to be traded under AfCFTA; modalities such as protection of infant industries; and an online negotiating forum to enable member States spearhead the success of the policy.

The remaining are: An online mechanism for monitoring and elimination of non-tariff barriers and AfCFTA mobile application for businesses including digital payments system for goods and services; a Pan-African payment and settlement system; and dashboard of the AU Trade Observatory, all of which are expected to accelerate the implementation of the AfCFTA.

Key Highlights

Based on the recommendations, the Executive Council of the AU earlier directed AfCFTA Council of Ministers and relevant Policy Organs of the AU to finalize consideration of the Draft Organizational Structure, including the appropriate functions of the appointed directors and the adequate number of the Permanent Secretariat of the AfCFTA, and submit it to the Extraordinary Summit in May 2020, together with a supplementary budget and work programme, through the appropriate Policy Organs of the AU system.