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Burundi has officially ratified the agreement establishing the African Continental Free Trade Area

Region Week | 7 July 2021

Burundi has officially ratified the agreement establishing the African Continental Free Trade Area

By Fabrice Iranzi

In a document that was made public this Tuesday, July 6, 2021, it was confirmed that Burundi officially ratified the agreement establishing the African Continental Free Trade Area on June 17, 2021. The document signed by President Evariste Ndayishimiye states that after analyzing the agreements signed by the African Union head of states signed in 2018 in Nouakchott, the government of Burundi accepts all dispositions of the agreement and therefore the agreements are accepted, ratified, and confirmed by Burundi.

The extraordinary summit of heads of state of December 5, 2020, adopted the instruments marking the launch of reforms, and, officially, the AfCFTA project agreement is now implemented from January 1, 2021, for countries that have already ratified.

Under the AfCFTA, the states that have ratified the agreement will agree to strongly liberalize their trade. The products of these lines (90% of tariff lines) are treated as non-sensitive and will have to be liberalized over a period of 10 years for the least developed countries (LDCs) and of 5 years for the other countries. Customs duties applicable to products on tariff lines considered sensitive (7%) will be subject to tariff dismantling of 13 years for LDCs and 10 years for other countries. And 3% of tariff lines are excluded from tariff commitments. They will not be liberalized.

According to experts, the AfCFTA does not plan to suppress the achievements of the regional economic communities. In the case of the EAC of which Burundi is a part, there are certain commitments that must be negotiated as a block rather than just one country. “At the EAC level, we have set up a customs union with a common external tariff. To do this, we need to submit bulk pricing offers. As a result, such offers have already been submitted to the AfCFTA secretariat.” notes Chrysologue Mutwa, Director General of Commerce

The background

The initiative to create a free trade area in Africa dates from the 1960s. Indeed, Kwame Nkrumah, the first Ghanaian president spoke in his book (Africa must unite) (Africa must unite) of (Union of African States), and the adoption of a common economic strategy in 1963. The Organization of African Unity (OAU) also was created 1963, but the ideas and the will were not shared.

As supporters of federalism such as Kwame Nkrumah and those inspired by an (Africa of States) with Senegalese President Léopord Sedar Senghor at the head split, the OAU eventually became an organization with the goal of cooperation and the idea of ​​integration was put aside.

In 1980, the Lagos Plan of Action for the Economic Development of Africa, known as the Lagos Plan of Action, was developed to find solutions to issues relating to the continent’s self-sufficiency.

Africa was facing a crisis due to global economic shocks, such as the 1973 oil crisis and the Lagos plan of action came as a response to the structural adjustment programs of the World Bank (WB) and the International Monetary Fund (IMF). Despite the Lagos Action Plan, the African continent continued to experience growing economies in debt.

The Abuja Treaty spells out a gradual and phased regional integration ː

– The first phase IS to strengthen the existing regional economic communities (RECs) and encourage the creation of other communities over a period of five years ;

– The second phase would be to eliminate tariff and non-tariff barriers in the trade of RECs over a period of eight years :

– The third phase is the creation of free trade areas, and customs unions by and in the RECs over a period of ten years ; The fourth step would be the creation of an African common market,

– The fifth step would be the creation of a monetary union with a single currency and a Pan-African parliament in four years ;

– Finally, over a period of five years, the free movement of people, goods and capital must be concretized followed by an African monetary fund. Based on the Abuja Treaty, the integration process is expected to be completed in 2028.

Meanwhile, the Abuja Treaty has encouraged the creation of several RECs. More than fourteen RECs are recognized by the United Nations Economic Commission for Africa including the Southern African Development Community (SADC), the Common Market for Eastern and Southern Africa (in English Common Market for Eastern and Southern Africa COMESA), and the Economic Community of West African States (ECOWAS) among others.

The continent’s integration project remained on the table of African leaders, with the arrival of the African Union (AU) in 2002. In October 2008, leaders of SADC, COMESA, and EAC announced the start of discussions on a tripartite free trade agreement.

The tripartite thus became a launching pad for the African Continental Free Trade Area (ZLECAF) and on June 15, 2015 in Johannesburg, South Africa, discussions began and the AU SE summit focused on a single point which is intra-African trade. In January 2015, the continent set a new goal, in line with its integration project (Agenda 2063).

The latter remains the strategic framework for the socio-economic transformation of the continent over the next fifty years and is titled (Africa We Want). Among the major projects of the program are the creation of the African Continental Free Trade Area, the African passport and the free movement of people demonstrate this Pan-African desire to unite, a will, and a vision that dates back a century. It was in January that the President of Niger, Mahamadou Issoufou, was tasked by his peers to lead and complete the process of negotiations on the ZLECAF project.

 source: Region Week