The Continental Free Trade Area Negotiations: Lessons from the Tripartite FTA tralac Annual Conference : International T rade Governance – quo vadis ? 6 & 7 April 2017: The T able Bay Hotel, V&A Waterfront, Cape T own, South Africa Mr. Prudence Sebahizi Chief Technical Advisor on the CFTA and Head of CFTA Unit Department of Trade and Industry
Why the CFTA? 1. Pan-Africanism and Political Liberation; tralac Annual Conference: International Trade Governance – 2. Economic Ownership (Lagos Plan of Action) - Low intra-African Trade ; 3. Towards African Economic Community (Article 6 of the Abuja Treaty); 4. Addressing the Challenges of Overlapping Membership (Rationalization of RECs); quo vadis? 5. Facing the changing global trade architecture (US new Administration, the BREXIT) - Positioning Africa ; 6. Harnessing Continental Opportunities - Demographic dividend &Trade and investment opportunities ; 7. Africa’s integration is vital to the successful implementation of Agenda 2063; 8. The CFTA is critical not only for its potential benefits, but also to mitigate the costs associated with inaction; 9. Africa’s Trade Patterns with the World is not Sustainable due to continuous Deterioration of Terms of Trade; 10. CFTA as a tool to foster Structural Transformation .
tralac Annual Conference: International Trade Governance – quo • “ One of the most fascinating things about Africa is the remarkable contrasts that formulate the continent. It is the richest continent in the World, but the poorest people in the world are found there ” – Kwame Tapiwa Muzawazi vadis? • “ We Must Realise that Progress Lies in Working Together ” – Paul Kagame
Roadmap for Africa’s Integration Agenda tralac Annual Conference: International Trade Governance – • The ‘Treaty Establishing the African Economic Community (AEC)’ (The Abuja Treaty) lays out a detailed time-bound schedule for African economic and political integration through six stages: i. 1994 – 1999: Establish and strengthen African Regional Economic Communities. quo vadis? ii. 2000 – 2007: Eliminate Tariff Barriers (TBs) & Non-Tariff Barriers (NTBs) in RECs. iii. 2008 – 2017: Establish Free Trade Areas (FTAs) & Customs Union (CUs) in RECs. iv. 2018 – 2019: Establish a Continental Level CU & Common External Tariff (CET). v. 2020 – 2023: Establish an African Common Market (CM), including the free movement of factors of production and the right of establishment. vi. 2024 – 2028: Establish a Pan-African economic and monetary union that includes the establishment of an African Central Bank and a single African Currency.
Roadmap for Negotiations of the CFTA 2016 Oct tralac Annual Conference: International Trade Governance – quo vadis?
The Future of Africa’s Integration: Fast – tracking the CFTA in Abuja Context tralac Annual Conference: International Trade Governance – quo vadis?
Update on the Establishment of the CFTA (1) tralac Annual Conference: International Trade Governance – quo • The 18 th Ordinary Session of the AU Assembly held in January 2012 in Addis Ababa, adopted an Action Plan for Boosting Intra-African Trade ( BIAT ) and agreed on a roadmap for the establishment of a CFTA by 2017. • The AU Assembly launched the CFTA negotiations at the 25 th Ordinary Summit of Heads of State and Government on 15 June 2015 in Johannesburg, South vadis? Africa. • The 27 th Ordinary Summit of the AU Heads of State and Government that took place in Kigali, July 2016, reaffirmed its commitment to fast tracking of the CFTA by 2017. • The 28 th Ordinary Session of the AU Heads of State and Government, held in Addis Ababa, Ethiopia, in January 2017 mandated H.E Mahamadou Issoufou, President of the Republic of Niger to champion the process of the CFTA to ensure that the deadline of the end of 2017 is reached and report on measures taken to the next ordinary session of the Assembly in July 2017.
Update on the establishment of the CFTA (2) • Since the June 2015 launch of the negotiations, much progress has been made to tralac Annual Conference: International Trade Governance – quo prepare the ground: • Analytical Studies to inform negotiations; • Capacity Building of Negotiators; • Establishment of the CFTA Negotiations Support Unit; vadis? • Drafting of the CFTA Model Text; • Decision to appoint Eminent Persons ( one per region); • Study on NTBs Elimination Mechanism. • In November – December 2016, the AUC organized Africa Trade Week that brought together key stakeholders to discuss the CFTA culminated into the High Level Trade Facilitation Forum. • Five meetings of the CFTA Negotiating Forum ( CFTA-NF ) were held in February, May, October, November 2016 and March 2017 at the AU Headquarters in Addis Ababa, Ethiopia.
CFTA Architecture Protocol Appendix I: Tariffs Liberalization Schedule of Commitments Annex A: Appendix II: Rules of Origin Appendix III: Customs Cooperation Establishing the Appendix IV: Trade Facilitation and Transit Agreement on Trade in Goods Appendix V: Non-Tariff Barriers Continental Appendix VI: Technical Barriers to Trade Appendix VII: Sanitary and Phyto-Sanitary Measures Free Trade Area Appendix VIII: Trade Remedies and Safeguards Schedules of Specific Commitments Annex B: Agreement on Movement of Natural Persons involved in Trade in Services Agreement on Trade in Services and Investment Regulatory Frameworks Reference to Annex C and Annex D Annex C: Agreement on Investment Annex D: Rules and Procedures on Dispute tralac Annual Conference: International Trade Governance – Settlement quo vadis?
Protocol Establishing th the CFT FTA Preamble CFTA Part I. Definitions Protocol Part II. Establishment, Objectives, Principles and Scope Part III. Administration and Organisation (Institutional Framework) Part IV. Transparency (Publication and Notification) Part V. General Provisions (Continental Preferences, CUs and FTAs) Part VI. Dispute Settlement Part VII. Final Provisions (Entry into force, Notification, Amendments) tralac Annual Conference: International Trade Governance – quo vadis?
Annex A: Agreement on Trade in Goods Preamble Agreement Part I. Definitions, Objectives, Scope and Principles on Trade in Part II. Non-discrimination (MFN and National Treatment) Goods Part III. Liberalisation of Trade (Imports and Export Duties, NTBs and RoO) Part IV. Customs Cooperation, Trade Facilitation and Transit Part V. Trade Remedies and Safeguards (Anti-dumping, Countervailing, Safeguard Measures) Part VI. Product Standards and Regulations (TBT, SPS Measures) Part VII. Agriculture, Fisheries And Food Security Part VIII. Complementary Policies (SEZs, Infant Industries and STEs) Part IX. Exceptions (General and Security Exceptions, BoP) Part X. Institutional Provisions (M&E, Consultation and DS, Oversight Committee) Part XI. Technical Assistance, Capacity Building and Cooperation tralac Annual Conference: International Trade Governance – quo vadis?
CFTA Agreement on Trade in Goods: Appendices Appendix I: Tariffs Liberalization Schedules of Commitments Appendices Appendix II: Rules of origin Appendix III: Customs Cooperation Appendix IV: Trade Facilitation and Transit Appendix V: Non – Tariff Barriers Appendix VI: Technical Barriers to Trade Appendix VII: Sanitary and Phytosanitary Measures Appendix VIII: Trade Remedies and Safeguards tralac Annual Conference: International Trade Governance – quo vadis?
Annex B: Agreement on Trade in Services Agreement Preamble on Trade in Part I: Definitions Services Part II. Scope of Application Part III. Objectives Part IV. General Obligations and Disciplines Part V. Progressive Liberalization Part VI. Institutional Provisions tralac Annual Conference: International Trade Governance – quo vadis?
Annex C: Agreement on Investment Agreement Part I: General Provisions on Part II. Objectives Investment Part III. Standards of Treatment of Investors and Investments Part IV. Development – Related Issues Part V. Investors’ Obligations Part VI. Institutional Provisions tralac Annual Conference: International Trade Governance – quo vadis?
Appendix on Movement of Natural Persons Involved in Services and Investment Movement General Principles on Movement of Persons of Natural Persons Process to Facilitate Entry Scope Definition of Categories of Natural Persons tralac Annual Conference: International Trade Governance – quo vadis?
Annex D: Rules and Procedures on Dispute Settlement Section 1: Objectives (Peaceful Settlement and Rules and Recourse to DSM) Procedures on Dispute Section 2: Alternate DS Procedures (Good Offices, Settlement Negotiation and Mediation) Section 3: Arbitration Section 4: Judicial Process tralac Annual Conference: International Trade Governance – quo vadis?
Lessons from the Tripartite FTA: Overview of the TFTA The Tripartite FTA is by far the largest FTA in Africa – 26 countries from the Cape of Good Hope to the Mediterranean Sea Trade between and among Tripartite member/Partner States has grown from US$62 billion in 2008 to US$98 billion in 2013 Has a combined population of 632 million people and a GDP of US$1.3 trillion It is envisaged that the Continental Free Trade Area launched in June 2015 will build on the successes of the TFTA
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