AFCFTA secretariat commences pilot trading with seven countries

Seven countries, including Rwanda, Cameroun, Egypt, Ghana, Kenya, Mauritius and Tanzania have been selected among countries to start trading under the African Continental Free Trade Area (AFCFTA) framework in a pilot phase. The move seeks to test the environmental, legal and trade policy basis for intra-african trade, according to the AFCFTA secretariat. Countries picked to participate in what is known as the AFCFTA Initiative on Guided Trade were announced during the 9th meeting of the AFCFTA Council of Ministers in Accra on Monday. They were selected from the 36 that had expressed interest in trading under the pilot phase. Each of the applicants had submitted its tariff schedule. According to the AFCFTA modalities, 90 per cent of tariff offers fall under category A, which covers products that were liberalised in 2021. This will progressively be reduced over 10 years. Seven per cent get liberalised over 15 years while three per cent of products are excluded from tax exemption. According to the AFCFTA Secretariat, the initiative seeks to demonstrate that AFCFTA is functioning and send a political message to countries that are yet to submit their provisional schedules of tariff concessions in accordance with agreed modalities.

The initiative will identify companies, products, customs procedures, and logistics processes required to enable a trade to happen under the AFCFTA, officials said.

Director General of Trade and Investment at the Ministry of Trade and Industry, Antoine Kajangwe, said Rwanda would now begin to access markets in the west and central Africa on preferential rates, with a reduction in duties having begun in 2021.

“Over time, this will increase Rwanda’s intra-african exports, spur industrialisation through economies of scale, increase employment in productive jobs, and lead to the structural transformation of Rwanda’s economy,” he said. Western African countries such as Ghana, Senegal, Nigeria, Chad, and Benin are said to present great potential for trade and investment for Rwanda’s private sector. Recently, the Economic Commission for Africa (ECA) launched a comprehensive tool that measures how easy, or hard, it is to do business between African countries.

Known as the AFCFTA Country Business Index (ACBI), it is expected to assess the perceived impact of the continental trade area on the private sector’s ability to trade and invest across African borders once the free-trade framework is operational.