bilaterals.org logo
bilaterals.org logo

AfCFTA

The African Continental Free Trade Area (AfCFTA) is a trade agreement that aims to create a vast free trade area for over 1.3 billion people with a combined GDP of over US$ 3.4 trillion.

The idea of creating an Africa-wide free trade area emerged at the 2012 African Union (AU) summit in Addis Ababa. Negotiations began in 2015 and the deal was signed by 44 of the 55 AU member states in March 2018, during the AU summit in Kigali. While the agreement has been operational since May 2019, some of its trade rules have only been implemented since October 2022 and between just seven states.

The AfCFTA aims to liberalize 97% of products, 90% of non-sensitive products followed by 7% of sensitive products. Phase 1 of the negotiation process has focused on trade in goods and services. Phase 2 includes competition policy, intellectual property and investment. Phase 3 incorporates e-commerce protocol. Key substantive issues are still to be completed, including some rules of origin, tariff concessions and specific services sector commitments.

The negotiating process has lacked transparency, with information available only through leaked texts. Social movements, including trade unions, have complained that they have tried in vain to engage with the AfCFTA secretariat.

While the proponents of the deal have claimed the AfCFTA will foster development in Africa and help African businesses, the deal has attracted criticism and opposition as well.

At first, large economies such as South Africa and Nigeria refused to endorse the agreement. Nigerian business groups, manufacturers, traders, farmers, small and medium enterprises expressed concerns that Africa could become a dumping ground of cheap products coming from abroad, which could wreak havoc on the ongoing industrialisation process. However, Nigeria joined at the 11th hour in July 2019, when the deal entered its operational phase, while South Africa had signed a year earlier. Eritrea is the only AU state that has refused to sign.

The AfCFTA is built on the dogma of free-market capitalism. It pushes a model of “development” hinged on increased trade and investment under the guise of pan-Africanism. However, it is “more of the same” trade rules that have been operational under the World Trade Organisation and bilateral agreements. It has been supported by major economic players such as the EU, the US, the African Development Bank, the United Nations Conference on Trade and Development, and the World Bank. Ultimately, it will likely benefit only African elites and transnational capital at the expense of local communities and small-scale traders who have historically traded informally in Africa, the majority of whom are women.

Some foreign powers have already seen opportunities arising from the AfCFTA. China is planning to capitalise on it to connect African and Chinese markets to promote the free movement of goods, persons, capital and technologies. India has signed a trade deal with Mauritius, which would provide a foothold into Africa. Turkish investors also see possibilities for development within the whole continent, while the EU might consider a mega trade deal. The US is speculated to sign a trade deal with the AfCFTA when the African Growth and Opportunity Act expires in 2025. The two parties have already signed a memorandum of understanding to promote trade and investment at the 2022 US-Africa Business Forum.

The full text of the AfCFTA is available here: https://www.bilaterals.org/?afcfta-consolidated-text-march

The following protocols are available here:
• Competition policy: https://www.bilaterals.org/?afcfta-protocol-on-competition
• Intellectual property rights: https://www.bilaterals.org/?afcfta-protocol-of-on-intellectual
• Investment: https://www.bilaterals.org/?afcfta-protocol-on-investment-48215
• Digital trade: https://www.bilaterals.org/?afcfta-digital-trade-protocol-49908
• Women and youth in trade: https://www.bilaterals.org/?afcfta-women-and-youth-in-trade

Last update: October 2023
photo: Paul Kagame/CC BY-NC-ND 2.0


Nigeria will sign Africa free trade agreement -presidency
Nigeria will sign an Africa free trade agreement at the coming African union summit, according to a statement posted on the Nigeria presidency’s Twitter feed.
Why Africa’s new free-trade area is great news for Americans
Only one set of trade deals will need to be negotiated with the AfCFTA—as opposed to fifty-five intricately-crafted trade deals with each small African economy.
EU to provide 40 billion euros in grants to help create jobs in Africa
The European Union Commission fully supports the African Continental Free Trade Agreement (AfCFTA) and is proposing a 40 billion Euro package to attract investments that would create at least 10 million jobs in Africa.
We cannot afford to rush into Africa free trade agreement – Buhari
“Africa needs not only a trade policy, but also a continental manufacturing agenda,” Buhari said. “Our vision for intra-African trade is for the free movement of made-in-Africa goods."
Rules of origin key to African Continental Free Trade Area: UN report
Rules of origin must be simple, transparent, business-friendly and predictable to work, said UNCTAD.
Will Africa’s free-trade area live up to the hype?
Africa is moving towards a more integrated, rules-based trade regime, but this is unlikely to transform the continent’s economic prospects
Why Nigeria should sign AfCFTA agreement – AfDB
Nigeria’s failure to sign the Africa Continental Free Trade Area (AfCFTA) agreement may hold the continent back on its economic prosperity drive, the African Development Bank (AfDB) has said.
Africa on its way to becoming a free trade zone
The African Continental Free Trade Area Agreement is one of the most ambitious projects of the African Union, and it is now, miraculously, in force. But that’s just the first step. The next phase will be crucial negotiations about the operational framework.
What next after the coming into force of African Free Trade Area
The African Continental Free Trade Area (ACFTA) will be launched on 7 July 2019 in Niamey, Niger, by the Heads of State and Government at an extraordinary summit of the African Union.
The African Continental Free Trade Agreement: Loss of sovereignty, lack of transparency
Rather than making drastic structural changes to the systems of production within Africa, the AfCFTA may intensify the ‘race to the bottom’ between working classes on the continent.