‘United States of Africa’: EU Welcomes Launch of African Free Trade Bloc But Challenges Remain

Written by | Tuesday, January 5th, 2021

As African countries began officially trading under a new continent-wide free trade area on Friday (1 January), experts still view the New Year’s Day launch as largely symbolic with full implementation of the deal expected to take years. Launched after months of delays caused by the global coronavirus pandemic, the African Continental Free Trade Area (AfCFTA) aims to bring together 1.3 billion people in a $3.4 trillion economic bloc that will be the largest free trade area since the establishment of the World Trade Organization (WTO). Supporters of the deal say it will boost trade among African neighbors while allowing the continent to develop its own value chains and lifting tens of millions out of poverty by 2035. But its opponents point to obstacles – ranging from ubiquitous red tape and poor infrastructure to the entrenched protectionism of some of its members – that must be overcome if the bloc is to reach its full potential.
Trade under the AfCFTA was meant to be launched on 1 July 1 2020, but was pushed back after COVID-19 made in-person negotiations impossible. However, the pandemic also gave the process added impetus, said Wamkele Mene, secretary-general of the AfCFTA secretariat. “COVID-19 has demonstrated that Africa is overly reliant on the export of primary commodities, overly reliant on global supply chains,” he said. “When the global supply chains are disrupted, we know that Africa suffers.” Eritrea is the single only African country that has not signed on to the AfCFTA framework agreement. But observers such as W. Gyude Moore, a former Liberian minister, admit that the real work begins now. “I would be surprised if they can have everything set up within 24 months,” he says. “For long-term success, I think we’ll need to look at how long it took Europe. This is a multi-decade process.”
“The European Union is investing political capital in the African Continental Free Trade Area,” stresses Françoise Guei, a Brussels-based trade and development policy advisor. During her second visit to the African Union Headquarters in Addis Ababa in February last year, Ursula von der Leyen, President of the European Commission said: “The plan for an Africa continental Free Trade agreement is a major opportunity that can unleash the great potential of the African continent.” It follows that, according to Guei, “the successful implementation of the AfCFTA is not only a concern for the African Union, but also for the EU. It is one of the top priorities in its new EU’s strategic alliance with Africa issued [in March 2020].” As Africa’s largest trading partner, the EU has very early recognized the benefits of a single continental market of around 1.3 billion of people at its gates. The launch of AfCFTA is taking place as emerging partners such as China, India, Turkey, and Russia increase their commercial relationship with Africa. With the EU’s trade with Africa stagnating and US-Africa trade dipping, Guei argues that “the EU’s engagement with and support of the AfCFTA becomes even more important in such a context if it wants to maintain its status as Africa’s main trading partner in the decade ahead.”

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