AfCFTA Guided Trade Initiative set for launch Friday

AfCFTA

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The African Continental Free Trade Area (AfCFTA) Secretariat will on Friday at the Kotoka International Airport in Accra, Ghana, launch the AfCFTA Guided Trade Initiative, to enable commercially meaningful trade and test AfCFTA’s legal and trade policy environment, intended to send a positive message to Africa’s economic operators.

The AfCFTA Secretariat says the launch of the guided trade initiative will see eight countries representing five African regions (Cameroon, Egypt, Ghana, Kenya, Mauritius, Rwanda, Tanzania and Tunisia) trading in goods produced in their countries under AfCFTA preferential tariffs, thereby creating collective development and prosperity which is at the core of the AfCFTA Agreement.

The Guided Trade Initiative would be matchmaking businesses and products for export and import between these countries, in coordination with their national AfCFTA implementation committees. The products earmarked for trade under the initiative and in line with the AfCFTA focus on value chain development include: ceramic tiles, batteries, tea, coffee, processed meat products, corn starch, sugar, pasta, glucose syrup, dried fruits, and sisal fiber, amongst others.

The AfCFTA is one of the flagship projects of the AU Agenda 2063 which seeks to create a single market for goods and services, and significantly boost intra-African trade across all sectors. It will be recalled that the Agreement was adopted at the 10th Extraordinary Summit of the Assembly of Heads of State and Government of the AU in March 2018 at Kigali, Rwanda and later came into force in May 2019, after the required 22 member states had deposited their instruments of ratification.

In August 2020, President Nana Akufo-Addo of Ghana officially handed over the AfCFTA Secretariat to the AU; Ghana having been selected as host of the AfCFTA Secretariat at the 12th Extraordinary Session of the AU Assembly, in Niamey, Niger. On January 1st 2021, trading under the AfCFTA was officially launched on the basis of legally implementable and reciprocal schedules of tariff concessions, making it the world’s largest trade bloc since the 1995 formation of the World Trade Organization (WTO).

Since there exist approximately 42 different currencies within Africa, the Secretariat and the African Export-Import Bank (Afreximbank), collaboratively established the Pan-African Payment and Settlement System (PAPSS), a centralized payment and settlement system for intra-African trade in goods and services, a commercial launch of which held January, 2022, at Accra, Ghana.

Earlier in October 2021, the 7th Meeting of the AfCFTA Council of Ministers adopted the Ministerial Directive on the Application of Provisional Schedules of Tariffs Concessions, which offered a legal basis for countries that had submitted their tariff schedules in accordance with the agreed modalities to trade preferentially amongst themselves.

The Ministerial Directive was subsequently adopted by the AU Assembly in February 2022. Nevertheless, since commercially meaningful trade was yet to commence under the AfCFTA, the Secretariat embarked on the AfCFTA Guided Trade Initiative, which was announced by the Secretary General of the AfCFTA, Wamkele Mene, at the 9th Meeting of the Council of Ministers held in July 2022.