An EPZ factory in Athi River, Kenya. The country is negotiating a free trade agreement with the US. PHOTO | NMG
African countries negotiating free trade agreements with parties from other parts of the world will be required to grant the same preferences or better terms to African Continental Free Trade Area (AfCFTA) member states.
The AfCFTA Secretary General Wamkele Keabetswe Mene, referring to Kenya, which is currently negotiating a free trade agreement with the US, said the same preferences granted to America should be given to African countries.
“Any country, any state party is within their legal rights to negotiate with a country outside of the AfCFTA Treaty, as long as you provide better or similar treatment to the AfCFTA party that you are intending to provide to a third party,” said Mr Mene.
He was responding to fears that the ongoing trade talks between Kenya and the US would undermine the Treaty seeing as Kenya also has obligations as a member of the EAC Customs Union.
Mr Mene said the matter was discussed and the rule was agreed upon at the Heads of State summit that met in July 2019. He added that during the 2019 AfCFTA summit, Kenyan President Uhuru Kenyatta discussed the US agreement with African leaders, who had no objection to it.
Trade deal
President Kenyatta has also sought to dispel fears that the ongoing trade talks between Kenya and the US will undermine the AfCFTA. He says Kenya’s trade deal with the US will assist the continent more broadly by creating a reference upon which other African nations can negotiate bilateral arrangements within the AfCFTA framework going forward.
“Beyond its economic importance, AfCFTA has the potential to accelerate continental integration efforts by promoting people-to-people interactions through trade,” said President Uhuru when he met Mr Mene at Sagana State lodge in Nyeri County in central Kenya on Wednesday.
Since AfCFTA’s commencement on January 1, tariffs on 90 per cent of lines are in the process of being eliminated over five years for other African countries, and for least developed countries it will be over a 10-year period.
On trade in services, the African Union Summit approved five priority sectors — business, communication, financial, tourism and travel-related services and transport.
The AfCFTA Secretariat has received 34 initial offers and a number of requests from state parties. In December 2020, the 13th Extraordinary Session of the African Union Assembly directed that all outstanding issues on Phase I — trade in goods and trade in services — be completed by June 2021.
Negotiations in investment, competition, intellectual property, e-commerce and women in trade are also expected to be completed in accordance with the timelines set by the Heads of State and Government.
According to a World Bank 2020 report, the agreement will connect 55 countries and a population of about 1.3 billion people.
The target market for the AfCFTA is projected to rise from about $1.27 billion to $1.7 billion by 2030, of which $600 million will be in the middle class. Further, implementation of the AfCFTA would benefit investments and consumer spending, estimated at $4 trillion.
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