Technical Working Groups Gather to Advance CFTA Process
Representatives from the African Union’s (AU) member states and experts from African regional economic communities, the United Nations Conference on Trade and Development (UNCTAD), the United Nations Economic Commission for Africa (ECA) and the African Development Bank (AfDB) are gathering from 21 August to 1 September in Durban, South Africa, to move forward the process towards establishing the Continental Free Trade Area (CFTA).
The two-week long session, which constitutes the Third Meeting of the CFTA Technical Working Groups (CFTA-TWGs), is expected to advance the preparation of various sets of legal provisions related to the CFTA Agreement ahead of the Eighth Meeting of the CFTA Negotiating Forum scheduled to take place in October.
“The objective of the Meeting is to continue the work that has already been undertaken since the beginning of the CFTA process by providing inputs to the relevant annexes and appendices of the CFTA Agreement for consideration by the CFTA Negotiating Forum,” reads a press release issued by the AU’s Trade and Industry Department.
According to the communiqué, this third meeting of the working groups will proceed in two phases. During the first five days, the groups dealing with legal and institutional affairs, non-tariffs barriers and technical barriers to trade, rules of origins, and trade in services are meeting in dedicated sessions, while from 28 August to 1 September it will be the turn of the groups covering sanitary and phytosanitary measures, customs procedures and trade facilitation, and trade remedies.
The second phase will also feature a dedicated session for CFTA chief negotiators to consider Annex A of the CFTA Agreement, namely the Agreement on Trade in Goods.
State of play
If the CFTA agreement is successfully concluded and implemented, it will establish a single market of over one billion people, bringing together 54 countries across Africa with a combined GDP of over US$3.4 trillion. It would constitute the world’s largest free trade area in terms of membership.
Hopes are high across Africa that by allowing the continent to overcome the considerable challenges posed by numerous small and fragmented markets, the CFTA will help put African economies on a path towards robust economic development and structural transformation.
In his remarks to the meeting of the CFTA-TWGs currently underway in Durban, Chiedu Osakwe, CFTA chief negotiator for Nigeria and chair of the meeting, insisted on the tremendous potential of the CFTA to attract investment both from the continent and beyond and to generate much-needed employment opportunities for African youth.
Negotiations towards the establishment of this African mega-FTA were officially launched in June 2015 with the objective of concluding them by the end of 2017 (See Bridges Africa, 15 June 2015). Six meetings of the CFTA Negotiating Forum (CFTA-NF), the CFTA dedicated negotiating body, were held since then, with the last one taking place last June in Niamey, Niger.
At the Sixth Meeting of the CFTA-NF in Niamey, negotiators finalised the CFTA modalities both for trade in goods and trade in services. The modalities were then discussed by the Third Meeting of Senior Trade Officials and adopted by the Third Meeting of African Ministers of Trade, also in Niamey.
Regarding trade in goods, CFTA members agreed to liberalise 90 percent of tariff lines. On the remaining 10 percent of product lines, countries have the possibility to designate sensitive products, on which they only have to undertake tariff reductions and on a longer time frame, as well as excluded products that will keep the same tariff level.
Sources have indicated that seven CFTA members have expressed concerns about the 90 percent threshold, and have so far not agreed to commit to such a level of liberalisation.
According to a press release issued by the ECA after the meeting of African ministers in Niamey, “further disciplines will be established through negotiations for the timeframe for liberalization, qualifications for sensitive products, and for a method to review excluded products.”
Regarding services, the agreed modalities provide that negotiations will proceed following a positive list approach with a view to progressively liberalise the included sectors.
“The priority sectors for liberalization will be determined without any prior exclusion of any service sector or supply mode,” indicates the ECA. As in the case of goods, the specifics of the liberalisation process are still to be determined.
Sticking to the deadline
At their meeting in June, African trade ministers have also revised the schedule of meetings to enable CFTA members to meet the end-of-the-year deadline, but the schedule has not been made public yet.
Addressing the meeting, President of Niger Issoufou Mahamadou, who has been named Champion of the CFTA, urged African trade ministers to stick to the 2017 deadline, underlining that such a time frame is realistic.
“While my task is to prod you to move with speed while producing tangible and substantive progress, as I am doing now, your task is also to push the Technical Working Groups and the Negotiating Forum to move with speed and produce tangible results. Let us not lose the momentum that we have built,” he insisted.
During the 29th Ordinary Session of the Assembly of the Heads of State and Government of the AU, which took place in July, African leaders also decided to “undertake nationwide stakeholder sensitization activities” in order to raise awareness among African citizens about the CFTA process, according to the AU’s Department of Trade and Industry’s recent press release.