State leaders from 44 African countries have agreed a deal to create a Continental Free Trade Area, set to become one of the largest in the world. The agreement was signed during a summit in the Rwandan capital, Kigali, although 10 countries refused to sign the deal, which will need to be ratified by all the signatories’ national parliaments before it can be put into effect. CFTA deal signed by African nations The African Continental Free Trade Area (CFTA) will remove a number of barriers to trade between African nations, including tariffs and import quotas, while allowing the free flow of goods and services between member countries – similar to the way the European Union operates now. The aim is to boost commerce, growth and employment in member states and make intra-African trade more profitable. Africa’s largest economy, Nigeria, is among the countries refusing to sign the deal and convincing the West African nation to get on board remains one of the biggest obstacles in the way of implementing the agreement. Nigerian president Muhammadu Buhari pulled out of last week’s summit after certain trade unions and businesses complained about not being consulted over the agreement. The African Union says it hopes the remaining countries will be persuaded to sign at a later date. Source: The East Africa Monitor

Grain sector stakeholders especially farmers, have been urged to improve productivity and enhance grain standards to take advantage of the huge market opportunities presented by the Africa Continental Free Trade Area (CFTA) agreement. A total of 44 countries signed the CFTA deal in Kigali on March 21, while 30 signed the Protocol on Free Movement of Persons, and 47 supported the creation of Africa’s one market by signing the Kigali Declaration. Joshua Rugema, the country director of East Africa Exchange, a regional commodity exchange based in Kigali, said they are excited about the continental free trade area “mainly because it provides regional and domestic markets unhindered access to African producers and exporters”. “This access will in turn boost productivity and overall competitiveness of the sector,” he said. One of the seven flagship initiatives under the African Union’s Agenda 2063 is the Africa commodity strategy, which will allow Africans to add value and extract higher prices for their commodities, he added. The East African Green Council (EAGC) executive director, Gerald Makau Masila said the historical agreement presents immense opportunities for foodstuff trade across the continent. He said: “Grains and cereals are among the main commodities that can yield higher incomes while also ensuring food security across the continent.” Masila challenged African agro-businesses to step up their game to benefit from the larger market of over 1.2 billion people and a combined Gross Domestic Product of more than $3.4 trillion, as well as push for the quick implementation of the CFTA. “As...

More than 40 countries signed the protocol to the treaty establishing the African Continental Free Trade Area (AfCFTA) in Kigali. The AfCFTA faces hurdles, but the eminent African tasked with reforming the African Union, Donald Kaberuka, remains optimistic. He spoke to Berna Namata. Before the AfCFTA, there were advanced talks on a tripartite area to bring together the EAC, SADC and Comesa, which could have covered about half of Africa. This trade deal is an acceleration of that process. Second, what we have learnt in this region is that it is possible to increase trade once you bring down tariffs as we have done in East Africa, because the level of trade within the region has almost reached the Association of Southeast Asian Nations levels -- just under 30 per cent. This is very significant. We now know that tariffs were not the most difficult thing to overcome: It is non-tariff restrictions. I hope and expect that as we launch the AfCFTA, we will bring these lessons to bare. There are gains to opening up, but we need to work hard on logistics, non-tariff restrictions and freedom of movement of people. There are several issues that need to be settled to make the AfCFTA agreement effective, but they require stronger political commitment. How much of a concern is this? I wouldn't say political will as such; it is how you address the fears of those who think that when you come together, it is a zero-sum game. There will of...

KIGALI, Mar. 22 (Xinhua) -- Africa expects to have a win-win situation with its partners through the African Continental Free Trade Area (AfCFTA), Chairman of the African Union (AU) and Rwandan President Paul Kagame said on Wednesday. The AfCFTA will broaden the existing partnership between Africa and its partners, said Kagame at a press conference after the 10th Extraordinary Session of the Assembly of the AU on the AfCFTA. With the continental free trade area, both Africa and its partners will have a much bigger market and benefit all, said the president. "Until now, the African external partners, China and others, have good relations with Africa," said President of Niger Mahamadou Issoufou. African and the external partners will be able to work together on the AfCTFA, said Issoufou, adding that Africa will be in a position to share the growth brought by the AfCFTA with external partners, in particular with China. Forty-four African countries on Wednesday signed an agreement to establish the AfCFTA during the one-day extraordinary session. The agreement will be submitted for ratification by state parties in accordance with their domestic laws. The decision to form the AfCFTA was adopted in January 2012 during the 18th Ordinary Session of the Assembly of Heads of State and Government of the AU while AfCFTA negotiations were launched by the AU in 2015. The AfCFTA is aimed at creating a single continental market for goods and services with free movement of businesses and investments. This, according to the AU, will pave...

“LET’S get together,” sang the choir to the rhythm of Bob Marley, as a succession of African leaders signed an ambitious, continent-wide free-trade agreement in Kigali on March 21st. Although all 55 members of the African Union (AU) had been involved in negotiations around the grandly named Continental Free Trade Area (CFTA), not all were ready to sign as one. On the day, 44 put pen to paper. Among the holdouts was Nigeria, Africa’s largest economy. Paul Kagame, Rwanda’s president and the host of the AU summit, had no time for sceptics. “Some horses decided to drink the water. Others have excuses and they end up dying of thirst.” The logic of the deal is sound. Trade in Africa is still shaped by relationships and infrastructure dating back to the colonial era. Countries mostly sell primary commodities to other continents. Only 18% of their exports are traded within Africa, where they often face high tariffs. The CFTA is meant to change that by creating a “single continental market for goods and services”. UNCTAD, a UN agency, reckons that eliminating import taxes between African countries would increase regional trade by a third and lift African GDP by 1% over time. Currently, nearly half of this trade is in manufactured goods. Services would also be opened up. But not everyone is convinced. Muhammadu Buhari, Nigeria’s president, cancelled his flight to Kigali amid domestic pressure. An official says Nigeria was given just a few days to read the text, which he worries will...

The Kigali Convention Centre broke into cheers during the 10th Extraordinary African Union Summit as 44 African countries signed the historical African Continental Free Trade Area (AfCFTA) agreement. All the years of hard work had come to fruition and Africa was finally on its way to claim its position on the world trade negotiation table. But how did this idea, which many say was floated as far back as over 40 years ago, make its way to Kigali and finally into history books? “It has been a long process,” Albert Muchanga, the Commissioner, Africa Union Trade and Industry, said in an interview. Muchanga explained that the process goes as far back as when the African Union, then Organisation of African Unity, was conceived in 1963. “What most people are seeing is something we started in 2015, but the reality is that this whole thing started when the African Union was conceived. At the time, Kwame Nkrumah, the first President of Ghana, made a passionate call for the unification of Africa,” he said. Delivered in Addis Ababa, Ethiopia, before 31 African Heads of State on May 24, 1963, Nkrumah’s speech, which has since become iconic, called for the creation of a strong continental union. “No independent African state today by itself has a chance to follow an independent course of economic development, and many of us who have tried to do this have been almost ruined or have had to return to the fold of the former colonial rulers. This position...

At its 2012 summit, the African Union validated a plan to set up an African Continental Free Trade Area by 2017. Six high-profile deliberations later, Africa is on the cusp of realising the African renaissance dream envisioned by post-Independence Pan-African visionaries. On Wednesday, the AU chairman, Rwanda’s President Paul Kagame, joined by Kenya’s President Uhuru Kenyatta and other African leaders, signed the continental trade deal and ushered in, perhaps, the biggest bet yet on Africa. The AfCFTA will single-handedly create a single market for goods and services in Africa, possibly growing intra-Africa trade from 12 per cent to nearly double that by 2022. This will create demand for manufactured goods and exponentially lead to growth in industrial production. EMPLOYMENT Kenya’s manufacturing sector contributes a paltry 10 per cent to gross domestic product (GDP). A well-executed AfCFTA will increase the manufacturing-to-GDP figure by contributing as much as $3.4 trillion by the year 2050. Going by the massive billion-strong African population, Kenya stands to gain a lot. The expected catalytic effect is a long-yearned-for fundamental transformation of African economies, which should positively tilt their growth potential and structurally transform them. If well executed, the AfCFTA could trigger the creation of jobs for the millions of unemployed African youth. But that has to be driven by a recalibration of trade between African countries. PRIVATE SECTOR To spur the great opportunity heralded by the AfCFTA, African countries must collectively adopt a remarkable turnaround on their industrial transformation policies. They should focus on building more...

African leaders gathered in Kigali have signed the Continental Free Trade Area (CFTA) treaty to create the world’s largest single market. The agreement, signed by more than 40 African nations, is said to be the largest since the creation of the World Trade Organisation. The pact aims at boosting intra-Africa trade by making Africa a single market of 1.2 billion people with a cumulative gross domestic product of more than $3.4 trillion. “For Africa, after decades of independence, marked by persistent under-development and a marginal place in the international system, the terms of the debate are laid down in almost Manichean terms: Unite or Perish, as Kwame Nkrumah said at the Addis Ababa founding Summit,” African Union Commission chairman Moussa Faki Mahamat told heads of states and governments at the signing ceremony. “Our peoples, our business community and our youth, in particular, cannot wait any longer to see the lifting of the barriers that divide our continent, hinder its economic take-off and perpetuate misery, even though Africa is abundantly endowed with wealth,” Mr Mahamat said. Of the 55 African Union member states, 44 countries signed the pact establishing the CTFA and 43 nations the Kigali Declaration launching the free trade area. Notable of among those that failed to sign the deal is the continent’s largest economy, Nigeria, with President Muhammadu Buhari having skipped the AU summit amid reservations on the treaty. Some 27 countries also signed the Protocol on Free Movement of Persons and the African Passport. The protocol allows...

President Uhuru Kenyatta was in Kigali yesterday to join other African leaders in sigining a new trade agreement. The African Continental Free Trade Area, which has been in the works for six years, will bring together 55 countries with a combined population of 1.2 billion and GDP of about Sh344.08 trillion. The trade pact, which includes Protocol on Trade in Goods, Protocol on Trade in Services and Protocol on Dispute Settlement, is expected to reduce tariff and non-tariff barriers which hamper intra-African trade. Nigeria and Uganda did not sign the agreement and sought more time. Signatory states will commit to absolving tariffs on 90 per cent of goods with 10 per cent of “sensitive items” to be phased out after further deliberations. It will also address licensing rules and quotas presented in non-tariff barriers. “Kenya has already removed tariffs on 37 per cent of total tariffs under the EAC Common External Tariff so Kenya will effectively remove tariffs on about 53 per cent of total tariffs,” Trade PS Chris Kiptoo told the Star. “The AfCFTA also provides for mechanisms on addressing non tariff barriers which has been a major hindrance to intra-African Trade.” AfCFTA, which will come into force after it has been signed by either 15 or 22 states - a number that has yet to be agreed on - will need to be ratified by the individual countries through respective domestic processes. This will lead to a second phase of negotiations which will be held later to cover...

Government and TradeMark Africa (TMA) have renewed partnership aimed at accelerating cross- border trade. The Ministry of Finance and Economic Planning and TradeMark Africa on Tuesday signed a financing agreement worth $53 million grant (about Rwf45 billion) to help support interventions that will result into job creation, poverty reduction and increase cross border trade. The agreement extends the current partnership until 2023, said Claver Gatete, the Minster for Finance and Economic Planning. This agreement marks the commencement of TMA's second phase of interventions which will be implemented between 2018-2023, he said after signing the agreement in Kigali. According to the agreement, TMA has committed to work with government and private partners to support the construction of storage facilities around Rubavu and Rusizi ports of Lake Kivu and provide support to Rwanda's plan to develop its industrial parks. According to minister Gatete, TMA has been a strong partner of government on a number of projects including construction of the Kagitumba One Stop Border Post, the development of the Rwanda electronic single window and the Rwanda electronic cargo tracking system and investment attraction towards the development of the Kigali logistics platform among other projects. "These have helped reduce the cost of doing trade significantly not only in Rwanda but across the region," he added. Frank Matsaert, the TMA group chief executive officer, said the organisation will also expand its work in supporting the implementation of quality standards in key export sectors like honey, tea, coffee, meat and horticulture, automation of trade processes...