Building capacity to help Africa trade better

Commemorating Africa Day – 2021


Commemorating Africa Day – 2021

Commemorating Africa Day – 2021

Today is Africa Day. How should it be commemorated in the year 2021 and how should this occasion be used to tackle the crises of our times?

Africa Day (formerly African Freedom Day and African Liberation Day) is the annual commemoration of the founding of the Organisation of African Unity (OAU) on 25 May 1963. The historical roots of this Organisation go back to the struggle for political liberation and the resolve of the people of Africa to free themselves from foreign domination. On 9 July 2002, in Durban, South Africa, the organisation was transformed into the African Union (AU). Africa Day is still celebrated, perhaps more as an opportunity to take stock and to engage with Africa’s future needs and challenges.

The commemoration of Africa Day is now closely linked to the AU and what it stands for. The decision to re-launch the OAU as the AU was inspired by the consensus that in order to realise Africa’s potential, it was necessary to shift the focus towards increased cooperation and integration of African states to drive Africa’s growth and economic development. The AU is guided by its vision of An Integrated, Prosperous and Peaceful Africa, driven by its own citizens and representing a dynamic force in the global arena.”

Since all African States belong to the AU, African Governments have, in addition to their own efforts, a joint platform for launching continent-wide initiatives to tackle the challenges facing the continent. In the year 2021, Africa’s progress should increasingly be measured against the yardstick of overcoming poverty and underdevelopment, achieving peace, sustainable development, gender equality and the battle against COVID-19. The younger generation of Africans are entitled to ask critical questions about the progress that has been made, outstanding challenges, the scourge of corruption, and how connected the AU is to their aspirations.

This year Africa Day is commemorated in the shadow of COVID-19. In President Ramaphosa’s letter to the nation to commemorate Africa Day, he wrote about the “huge task we have to build a better life for all the people of Africa.... The COVID-19 pandemic has made people already suffering from the effects of conflict, under-development and poverty even more vulnerable… Many of the continent’s developmental gains may be reversed as the fight against the pandemic takes precedence over other national priorities like poverty eradication.”

He called for further measures by the international community and organisations like the World Bank and International Monetary Fund (IMF) to support low- and middle-income countries in particular. He also mentioned Africa’s debt crisis and wrote that there should be increased concessional financing by international institutions and development agencies, and additional measures led by the G20 countries to provide African countries with debt relief. In what he described as a New Deal for Africa, he emphasised the collective responsibility to implement financial relief measures for African countries in distress. He did add that there must be a greater role for the continental network of African public development banks to mobilise funding to support key projects in health, education, infrastructure, green growth, and other sectors.

There are lessons to be learned from the pandemic, but also from domestic governance failures. One of them is that public health should be a continental priority and that there should be more collaboration between African countries and international partners. Another one is that sustainable economic recovery can only be assured if the levels of investment on the continent is increased. Africa will only grow into a more attractive destination for the type of investment that will assure long-term growth if, in the words of President Ramaphosa, “African leaders acknowledge the centrality of good governance, public debt management, financial integrity and creating a more favourable climate for private sector investment in their economies”.

President Ramaphosa also mentioned the African Continental Free Trade Area (AfCFTA) and notes that it will play a key role in the continent’s recovery. The AfCFTA is an ambitious initiative to integrate, eventually, the 55 member states of the AU. Although a decision was made by the Heads of State to launch trade on 1 January 2021, key negotiations are still underway. For trade in goods, the essential requirements for a free trade area – reciprocal tariff concessions and preferential rules of origin – are still being negotiated. Although rules of origin have been agreed for more than two-thirds of products in the tariff book, it is of course those that are still to be agreed, that are most sensitive. Tariff concessions are also very sensitive; especially for products that hold promise to increase intra-Africa trade. These include clothing and textiles, some agricultural and automotive products. We are also reminded of course that non-tariff barriers are the really pernicious impediments to intra-Africa trade, also adding significantly to the costs of trading with global trade partners. tralac research has found that a 20% reduction in time in transit (time on the road and at border posts) would yield great gains than complete elimination of all tariffs on the continent. Improvements in customs and border management, adoption of digital trade solutions, and effective cooperation among borer agencies will contribute significantly to more competitive enterprises and improve trade and broader economic governance on the continent. Africa Day provides an excellent opportunity for us to reflect on this practical trade facilitation agenda that will have a multiplier effect to promote Africa integration and to support a new trajectory for Africa’s competitive integration into the global economy.

About the Author(s)

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.

Trudi Hartzenberg

Trudi Hartzenberg is the Executive Director of tralac. She has a special interest in trade-related capacity building. Her research areas include trade policy issues, regional integration, investment, industrial and competition policy.

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