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What does the AfCFTA mean for an EU-Africa trade agreement?

25-10-2021

Sean Woolfrey, ECDPM brief, October 2021

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The African Continental Free Trade Area (AfCFTA) aims to promote intra-African trade, but it will also affect Africa’s external trade relations. The EU, Africa’s foremost trade partner, views the AfCFTA as a step towards its long-term ambition of a continent-to-continent free trade agreement (FTA). But does this ambition make sense from an African point of view?

Realising this ambition would require major changes on the African side. African states would need to establish a continental customs union, to align their trade interests towards the EU and to provide a mandate to the African Union, or another continental body, to represent them in trade negotiations. However, various political economy dynamics are likely to thwart these changes. African states’ ambivalence towards deeper integration will complicate efforts to establish a continental customs union. The different pressures and incentives they face will make it hard for them to align their trade interests visa-vis the EU and their desire to preserve sovereignty means they will be reluctant to give the AU a mandate to represent them in trade negotiations.

Proponents of a continent-to-continent FTA should therefore focus their efforts on supporting the implementation of the AfCFTA and related African integration processes and on improving existing trade arrangements between the EU and Africa. Such efforts could help pave the way for a future continent-to-continent FTA. At the same time policymakers on both sides should not let a preoccupation with a continent-to-continent FTA divert attention away from other avenues to foster constructive EU-Africa collaboration on trade


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The political economy dynamics of regional organisations in Africa


This paper was produced as part of the second phase of our project on the political economy dynamics of regional organisations in Africa – PEDRO II.


Photo courtesy of Ian Taylor on Unsplash.

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Comments

Lidiya

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2021-11-06 22:18:49

The AFCFTA is very Instrumental way in bringing a regional trade integration and facilitate backward and forward linkage among suppliers, manufacturers, and other actors in the continent. A successful implementation of AFCFTA requires a strong political will which is backed up with the enabling policies and conducive Infrastructure (This infrastructure can be both physical and Technological). Beyond the regional integration AFCTFTA also have a positive implication on the Africa’s Investment and Trade relation with another countries for instance the EU member countries. What changes will AFCFTA bring to the EU-Africa Trade and Investment Partnership EU has been a long trade and Investment partner for the continent and there’s an optimism that the recent AFCFTA agreement in the continent will ensure uniformity and consistency in the regulatory framework and transaction laws. To bring this uniformity AFCFTA member countries have to be in alignment in purpose and bring their collective voice as once in the international market, but the challenge is that each country has its own national interest when it comes to a Trade and Investment Interest with other EU countries. To bring a collective voice and keeping the interest of all parties African Union (AU) can play a significant role in facilitating the negotiation among AFCFTA countries and ensuring uniformity in laws and communicating the best interest of all parties in the international arena.

African economic integrationBriefing Notes (series)African Continental Free Trade Area (AfCFTA)