The implementation phase of the African continental free trade area (AfCFTA), which went into operation on January 1st, is still burdened with technical details, as important provisions of the agreement do not yet have to be concluded.
The technical Regulations that turn out to be trade barriers are the rules of origin, the customs offer and the customs union.
A meeting on 18.-19. September at the AfCFTA headquarters in Accra, Ghana, to review the agreement nine months after its entry into force found that without these provisions no trade can take place, at least not as easily as planned.
East Africa’s private sector was in Accra by the East African Business Council (EABC.)) Chief Executive John Bosco Kalisa, who emphasized the importance of introducing the rules of origin in the continent’s free trade agreement.
“So far there has been no trade as we are still ironing out problems . Before anyone starts trading, a number of key components such as tariffs and rules of origin – the criteria needed to determine the national origin of a product – need to be agreed. The rules of origin are basically the “goods passport” and if these rules have not yet been agreed and finalized, trading is very difficult. The third key component is the harmonization of customs union procedures, “he said.
Rules of origin determine which products can be subject to duties and tariffs.
” These three instruments are very critical and despite of the official start of trade in July, as these are still in progress, we still have to fully operationalize the AfCFTA, “said Kalisa, adding that the AfCFTA removes tariffs on 90 percent of goods produced on the continent and removes non-tariff trade barriers and guarantees trade free movement of people. However, none of the regional blocks has reached the tariff threshold of 90%.
“The EAC has not started trading because we have not reached the tariff offer threshold. We are currently at around 83 percent and we have to offer a tariff of Reach 90 percent so that we can act under AfCFTA, “said Kalisa.
The Accra meeting was a preparatory technical meeting for the first joint coordination meeting of the heads of regional economic communities (RECs) on implementation.
As a representative of the bloc of the East African Community in Accra, Secretary General Peter Mathuki said: “The AfCFTA has yet to establish the rules of origin, but these usually determine whether preferential trade liberalization is or is applicable. Their meaning arises from the fact that tariffs and restrictions in some cases depend on the source of the imports. ”
Dr. Mathuki also said that a general lack of awareness is unde r deny the opportunity to discover markets for industrial goods on the continent.
“Someone who makes coffee in Thika, Kenya, may not know whether this coffee is in demand in Ghana, Nigeria or Senegal. Therefore, they continue to export to their traditional markets in Europe and elsewhere. ”