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AfCFTA Protocols: an Implementation Primer
Analysis
Key messages on the new AfCFTA protocols
- The AfCFTA Agreement is a thick rulebook of which many pages are left to write
- If it is a worthy endeavour to ensure the AfCFTA adequately balances trade liberalisation and socio-economic development, dispersion risks to create loopholes and generate inconsistent, undesirable effects
- Inclusive negotiations require capacity, commitment and foresight
Table of contents
Introduction
In 2018, the African Continental Free Trade Area (AfCFTA) was established to create one of the most comprehensive and ambitious free trade agreements in Africa. The agreement covers trade in goods, services, investment, intellectual property rights, and competition policy. Despite ongoing efforts to finalize the agreement, the African Union (AU) decided to add a digital trade protocol during its 33rd AU Summit in January 2020 and negotiate a Women & Youth in Trade protocol during its 35th AU Summit in February 2022, which were adopted four and two years later, respectively. This is great news.
However, there have been concerns that existing instruments are not receiving adequate policy attention. Information about the content of the instruments is often disclosed (if not leaked) only after adoption, which is a legitimate concern. Additionally, there has been little progress in operationalizing the instruments in place. Policy success often reduces the appetite for technical progress, so it remains unclear whether the AfCFTA is expanding or deepening.
Where are we with the existing AfCFTA protocols?
Rulemaking-wise
Here are some useful indicators to quantify the impact of one year’s worth of dedicated political will:
1 (out of a total of 47) have acceded to the AfCFTA during the thematic year;
11 (of which 3 joined during the thematic year) of the 47 State Parties participate in the GTI. If we consider this participation as a proxy for implementation readiness, less than 1/4 of the State Parties are AfCFTA-ready;
2 new protocols were adopted;
3 tariff offers were presented;
rules of origin covering 1.3% of the HS nomenclature and 2.4% of intra-African trade were finalised.
Five – of the eight – existing protocols are unfinished.
Content-wise
In addition, numerous voices have started to warn against the strict closed-door policy of the negotiating arena of the AfCFTA protocols.
Though some degree of secrecy is fully understandable in carrying out this difficult diplomatic exercise, one also recalls that one of the general objectives of the AfCFTA is to promote and attain sustainable and inclusive socio-economic development, gender equality and structural transformation of the State Parties (Art. 3(e) of the Agreement establishing the AfCFTA).
As some heartwarming news of progress emerged, critics noted that certain provisions failed to meet the agreement’s higher objectives. The negotiation results were presented as a fait accompli.
Consequently, the agreement furthers the traditional patterns inherited from the past and falls short of its promises to be the game-changer people expected to witness.
Take, for instance, intellectual property rights. Various sources in the field of agricultural activism share a common view on this matter.
Citizen-led, pan-African resistance is required to oppose this new tool of privatisation. It is unacceptable to grant monopoly rights over seeds, which are a heritage of communities for the benefit of humanity, to breeders who make only minor adjustments and then claim them as their own. Nor is it acceptable for state or private stakeholders to acquire, through other intellectual property rights, a powerful symbol of cultural identity for almost an entire continent. These are resource grabs and as such they must be prohibited.
Mohamed Coulibaly, Land, Seeds, Biodiversity & Natural Resources Expert in GRAIN
Or about digital trade,
We must not forget that the notion of restricting governments ability to regulate the data economy was borne in the United States. Starting in the 2010s, the largest online platforms, often through their myriad lobbying associations and front groups, commenced lobbying to capture trade negotiations to insert binding trade-agreement terms that would lock in the low-road global regulation model they prefer. The companies’ goal was to lock in their outsized power and preempt efforts to regulate the digital economy in the public interest.
The U.S. government has finally accepted that trade policy is not a tool to be wielded to favor its powerful economic interests to the detriment of people both in the United States but abroad as well. It is therefore especially surprising that just when the US has abandoned these Big-Tech designed ruels, Africa would take the noose and willingly put it around its neck.
James Thuo Gathii, Trade Law Expert & Wing-Tat Lee Chair of International Law at Loyola University Chicago School of Law in AfronomicsLaw
The argument for pragmatism
It is tempting to want more rules to discipline further what has either been left hanging or requires more voluntaristic common policies.
This can be seen everywhere, all the time.
From the civil society,
[w]hile trade liberalization brings numerous benefits, it can sometimes lead to job displacement, especially in certain industries. Labour protocols can include provisions to address the needs of displaced workers, providing opportunities for retraining, job transitions, and support during economic transitions. It is t herefore important to develop a a comprehensive labour protocol within the framework of AfCFTA, that aligns with the [International Labour Organization] labour principles and makes the necessary provisions for the youth, women, and informal sector workers in Africa.
Hod Anyigba, Labour Economist in ALREI Policy Brief 001 – January 2024
From the international community,
Calling for a mandate to develop an additional legal instrument on cooperation on trade, environment and sustainable development building for example on the African Nature Convention and African Union Guidelines for the Coordinated Implementation of the Nagoya Protocol on Access to Genetic Resources and the Fair and Equitable Sharing of Benefits Resulting from their Utilization. Such an
instrument could specifically address and enable trade in biological and genetic resources, among others. The nexus between trade and environment […] should also be incorporated into existing instruments and those under negotiation.Frederic Perron-Welch, Consultant in UNCTAD report
And from the AfCFTA Secretariat itself suggested a new AfCFTA Protocol on fisheries.
Need for new, additional rules
But beyond political will, the question of capacity remains a critical issue in delivering sound, safe and effective negotiation outcomes.
So far, the odds are against the institution:
The records speak for themselves. With the entry of the AfCFTA Agreement into force in 2019, the first pluriannual review is due this year. But as explained above, the legal inflation seems to have rather delayed some already overdue instruments, such as the tariff concessions or the rules of origin, as highlighted by the AfCFTA Champion, H.E. Mahamadou Issoufou, in his 2024 report to the AU Assembly.
The political goodwill is at times fraught with technical misconceptions. Take the alleged ban on second-hand clothing, for instance. It is both misleading and misconceived. Technically, the rules adopted do not make the difference between new and used clothing. They identify and disqualify clothing items that show significant wear signs and are presented in bulk.3 This neither covers all second-hand clothes nor factors in the fact that about 80% of the African population buys clothing items from the second-hand market. Last but not least, the second-hand market is supplied with imports from the rest of the world, not “Made in Africa” clothes.
The lack of resources remains daunting. This is not new. The resource allocation of such projects has been on long-standing issue.4 Although it is a known fact, it does not take away the shock of reading the problem’s magnitude. Citing the Champion again, the organisation relies on external partners for over 3/4 of its budget to implement one of its flagship projects. It means time and labour dedicated divert from the already stretched human resources.
Mainstreaming or supplementing with new AfCFTA protocols?
Fostering ownership, the United Nations Economic Commission for Africa (UNECA) has supported AfCFTA implementation at national and regional levels as a key technical partner to the AU and AfCFTA Secretariat.
Their strategy has largely focused on integrating aspects not included in the agreement and combining them with measures aimed at promoting the implementation of the agreement’s provisions. Their work on the environmental aspect stands out as particularly noticeable.
Conclusion
Undoubtedly, the AfCFA was adopted as one of the most ambitious and comprehensive African free trade agreements. However, much more is still needed to give it the means to fulfil its promises.
While two new protocols have recently been added to the agreement, arguments for new rules are emerging due to inadequate policy attention in the existing instruments in some areas. On the other hand, there has been little progress in operationalising the instruments in place.
The recent annual report presented by the AfCFTA Secretary-General showed that only a small fraction of State Parties are AfCFTA-ready. Moreover, five of the eight existing protocols are unfinished, and there is a need for new, additional rules. However, capacity remains a critical issue in delivering sound negotiation outcomes.
Suppose the AfCFTA presents a unique opportunity for African countries to transform their economies. In that case, the Union must work together to overcome the challenges of implementing such a significant trade agreement.
So, is the AfCFTA truly the key to unlocking Africa’s economic potential or just another overhyped institutional experiment?
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