Building capacity to help Africa trade better

The AfCFTA’s Institutions are vital for effective Implementation


The AfCFTA’s Institutions are vital for effective Implementation

The AfCFTA’s Institutions are vital for effective Implementation

When all the outstanding negotiations are complete, implementation of the African Continental Free Trade Agreement (AfCFTA) obligations will be the responsibility of individual State Parties. The AfCFTA does not have supra-national institutions. Subsequent technical support and surveillance measures will be necessary to prevent uneven or incomplete outcomes. Experiences in the Regional Economic Community (REC) free trade areas (FTAs), where integration stands at higher levels and has a longer history, show that trade facilitation challenges, non-tariff barriers, uncoordinated domestic measures, lack of harmonisation of regulatory regimes and trade governance failures remain the most serious challenges faced by intra-African trade liberalisation and integration. The AfCFTA does not provide new answers to solve these governance problems. It recognises the governance problems and provides for more opportunities to undertake joint action. It will be up to individual state Parties to resolve them. They will be assisted by institutions linked to specific technical functions.

Several of the AfCFTA’s essential building blocks will only be adopted during Phase II of the negotiations. There will not be a complete framework for continent-wide trade in goods and services before the Protocols on Competition, Intellectual Property Rights and Investment have been concluded. They are vital for completing the rules of the game and for ensuring an inherently consistent continental arrangement. The different parts of the AfCFTA project should speak to each other. Rules about foreign direct investment, investment promotion and facilitation are linked to, for example, Mode Three (commercial presence) in the Protocol on Trade in Services. Harmonisation (not cooperation) of the rules on transport services will be vital in order to deal with congestion at border posts. Better remedies for addressing NTBs will be equally important. There is a long list of governance reforms to be undertaken.

In a Free Trade Area (FTA), the State Parties retain national jurisdiction over external trade policy (there is no Common External Tariff) and are individually responsible for implementing the legal instruments governing trade in goods and services and related aspects. The AfCFTA rules of origin, which identify goods entitled to preferential treatment and preventing trade deflection (an FTA does not have a single customs territory) will be a crucial feature of the AfCFTA. The content of the AfCFTA Annex on rules of origin is not yet known but present indications are that they may require compliance with product specific rules. An institution such as the AfCFTA Secretariat (the responsibilities and tasks of which must still be finalised) will hopefully become an active continental agent and facilitator of the governance improvements required to make the AfCFTA a game changer.

Trade and integration arrangements cannot function without properly equipped institutions. How does the institutional architecture of the AfCFTA look, given that this is a member-driven arrangement? There are two main layers of AfCFTA institutions. Part III of the AfCFTA Agreement (dedicated to Administration and Organisation) provides for an “institutional framework for the implementation, administration, facilitation, monitoring and evaluation of the AfCFTA.” It consists of the Assembly, the Council of Ministers, the Committee of Senior Trade Officials, and the Secretariat.[1] These are the AfCFTA’s Framework Institutions. They are essentially high-level political platforms for the membership, where decisions are taken on the basis of the tried and tested consensus formula.

The RECs (not customs unions and regional trading arrangements mentioned in Article 19(2) of the AfCFTA Agreement) shall be represented in the Committee of Senior Trade Officials, in an advisory capacity. Exactly how this representation will happen and how all the different RECs (some of which do not have FTAs) will act through a single mechanism, is not yet clear.

The Secretariat will operate on a full-time basis. Its tasks and responsibilities will be particularised in decisions still to be adopted by the Assembly and the Council of Ministers. The Assembly shall establish the Secretariat, decide on its nature, location and approve its structure and budget. The roles and responsibilities of the Secretariat shall be determined by the Council of Ministers of Trade. Under the Secretariat’s specific tasks count the following:

  • State Parties must notify each other, through the Secretariat, of laws, regulations, procedures and administrative rulings of general application as well as any other commitments under an international agreement relating to any trade matter covered by the AfCFTA Agreement.[2]

  • State Parties shall also, through the Secretariat, promptly provide information and respond to questions pertaining to an actual or proposed measure, irrespective of whether or not the other State Party was previously notified of that measure.[3]

  • State Parties shall notify the Secretariat of any international and regional agreement pertaining to or affecting trade in services with Third Parties to which they are signatory prior to or after entry into force of this Protocol.[4] The Secretariat shall promptly circulate said notification to other State Parties.

  • The Secretariat must circulate information on the modification of Schedules of Specific Services Commitments to State Parties.[5]

  • The Secretariat will also be responsible for technical assistance and capacity building. It shall, for example, coordinate the provision of technical assistance in the area of trade in services.[6]

  • Article 10 of the AfCFTA Trade Remedy Annex states that the Secretariat shall provide technical assistance to State Parties in collaboration with partners, on request by such State Parties, in order to enhance the capacities of State Parties in the application of trade remedies measures.

  • The Secretariat shall, in addition, develop mechanisms for cooperation in technical assistance and capacity building to address standards, technical regulations, conformity assessment, accreditation and metrology.[7]

There is, in addition, a second layer of technical and ad hoc institutions, listed in the Protocols and in the Annexes. These are instruments for joint action in those instances where more specialised Governance Bodies are required.[8] The AfCFTA Governance Bodies are not operational yet but will, as a rule, be composed of duly designated representatives from the State Parties and shall carry out the responsibilities assigned in the relevant Annexes. They will, in appropriate instances,[9] be linked to National Bodies and Focal Points.

The Governance Bodies will consist of the following and will perform the associated tasks:

A Protocol on Dispute Settlement has also been adopted. It replicates the WTO Dispute settlement Understanding and provides for Panels and an Appellate Body.

[1] See Arts 9 – 13 AfCFTA Agreement.  pdf Agreement establishing the AfCFTA (Consolidated text - signed 21 March 2018) (973 KB)

[2] Art 17 AfCFTA Agreement.

[3] Ibid.

[4] Art 5 AfCFTA Protocol on Trade in Service.  pdf Compiled Annexes to the AfCFTA Agreement (Legally scrubbed version - signed 16 May 2018) (985 KB)

[5] Art 23 Protocol on Trade in Services.

[6] Art 27(3) AfCFTA Protocol on Trade in Services.

[7] Art 12(2) AfCFTA Annex on Technical Barriers to Trade.

[8] The terms “Framework Institutions” and “Governance Bodies” are the author’s.

[9] As for Non-Tariff Barriers and Trade Facilitation.

[10] Art 31 AfCFTA Protocol on Trade in Goods. The Council of Ministers must establish it.

[11] Art 26 AfCFTA Protocol on Trade in Services. The Council of Ministers must establish it.

[12] Art 38 AfCFTA Annex on Rules of Origin.

[13] Art 13 AfCFTA Annex on Customs Co-operation and Mutual Administrative Assistance. See also Art 12 of the AfCFTA Annex on Transit.

[14] Art 27 AfCFTA Annex on Trade Facilitation.

[15] Art 4 AfCFTA Annex on Non-Tariff Barriers.

[16] Art 13(1) AfCFTA Annex on Technical Barriers to Trade.

[17] Art 15 AfCFTA Annex on Sanitary and Phytosanitary Measures.

[18] Art 12 AfCFTA Annex on Trade Remedies. The AfCFTA Guidelines on the Implementation of Trade Remedies shall, upon adoption, form an integral part of this Annex.

About the Author(s)

Gerhard Erasmus

Gerhard Erasmus

Gerhard Erasmus is a founder of tralac and Professor Emeritus (Law Faculty), University of Stellenbosch. He holds degrees from the University of the Free State, Bloemfontein (B.Iuris, LL.B), Leiden in the Netherlands (LLD) and a Master’s from the Fletcher School of Law and Diplomacy. He has consulted for governments, the private sector and regional organisations in southern Africa. He has also been involved in the drafting of the South African and Namibian constitutions. He grew up in Namibia.

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