Mega trade agreement a step forward for the continent


carlos-lopes-2Johannesburg, 12 June 2015 (ECA) – The Executive Secretary of the Economic Commission for Africa (ECA), Mr Carlos Lopes has lauded the tripartite free trade area agreement reached by three Regional Economic Communities (COMESA, EAC and SADC) as “a step in the right direction for the Continent.”

Speaking in Johannesburg in the margins of the 25th African Union Summit holding this week, Mr. Lopes congratulated the landmark agreement and said, “with the countdown towards the 2017 establishment of a Continental Free Trade Area, the launch of the negotiations this week is also another key milestone for Africa.”

African countries committed themselves to economic integration in 1991 through the Abuja Treaty which came into force in 1994 with the intention of moving towards the African Economic Community. The process of this integration would entail Regional Economic Communities (RECs) serving as building blocks. “The harmonization of trade policies through the Tripartite Free Trade Area is yet another building block,” he added.

While not all countries have signed on to their region’s tripartite agreement and the negotiations towards the 2017 deadline for the establishment of the Continental Free Trade Area (CFTA) will need to address some thorny issues, Mr. Lopes stressed that the principle at work is that of ‘variable geometry’ as not all countries are ready at the same time.

He cited the 2015 Economic Report on Africa published by the ECA stating that deepening market integration is one of the necessary conditions for industrialization in Africa. The tripartite agreement, he added, “has set a benchmark for the CFTA, as it demonstrates it can be done.”

There are expectations that countries will complete the negotiations in the next 12 months. This sets the stage for deepening the agreement. In the meantime, the ratification of the CFTA, which requires a minimum of 14 countries to come into force, will begin.

In her statement to the Executive Council, the African Union Chairperson, Dr. Nkosazana Dlamini Zima said that trade amongst African countries remains below global standards, although a number of regions through their Economic Communities (RECs) are making progress – especially in the East African Community, in SADC, ECOWAS and COMESA.

She noted that the trade agreement reached by the tripartite and the launch of the African Continental Free Trade negotiations this year, “are all aimed at growing trade amongst ourselves and therefore jobs and creation of wealth.”

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