NIGERIA: African Free Trade Agreement Takes Shape

Edited from the original article published on January 27, 2021

The African Continental Free Trade Area (AfCFTA) Agreement established in 2018 by members of the African Union (AU) is gradually taking shape, with 34 member countries having submitted their instruments of ratification with the chairperson of the AU Commission.

Trading commenced on January 1, 2021. In regions of the AfCFTA where a robust protocol on intellectual property rights (IPRs) is forming, it is hoped that the Agreement will bring about a coordinated and sustained trade system on the African continent. It is believed this will serve as a catalyst to attract more investors to Africa.

The AfCFTA is notably the largest in the world in terms of the number of participating countries since the formation of the World Trade Organization. The AfCFTA Secretariat is located in Ghana.

The AfCFTA covers trade in goods, trade in services, investment, IPRs, and competition policy, with the objective of encouraging intra-African trade by creating a single market and expanding the commercial integration of the African continent. There was also agreement to reduce tariffs on 90 percent of all goods, although each state is permitted to exclude 3 percent of goods from this agreement.

Modalities for trade in goods and services have been discussed in the first phase. Negotiations on matters such as tariff concessions and rules of origin are yet to be concluded.

The AfCFTA Protocol on Intellectual Property Rights will be negotiated during the second phase. It is unclear when this will begin. It is important for stakeholders with interest in various member states to engage continuously with the respective member states to ensure that uniform IPR rules are developed to aid the efficient protection of their IPRs.

The AU’s understanding of the importance of IPR is evidenced in Article 4 (c) of the AfCFTA, which provides that “for purposes of fulfilling and realising the objectives of the AfCFTA the State Parties shall cooperate on investment, Intellectual Property Rights and competition policy.”

As of December 5, 2020, these countries had deposited their instruments of ratification: Angola, Burkina Faso, Cameroon, the Central African Republic, Chad, the Congo, Côte d’Ivoire, Djibouti, Egypt, Equatorial Guinea, Eswatini, Ethiopia, Gabon, Gambia, Ghana, Guinea, Kenya, Lesotho, Malawi, Mali, Mauritania, Mauritius, Namibia, Niger, Nigeria, Rwanda, the Sahrawi Arab Democratic Republic, São Tomé & Príncipe, Senegal, Sierra Leone, South Africa, Togo, Tunisia, Uganda, Zambia, and Zimbabwe.

Algeria, Somalia, and Zambia have obtained cabinet approval and are awaiting official ratification.

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