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The AfCFTA Guided Trade Initiative

BACKGROUND

The Thirteenth Extraordinary Session of the African Union Assembly of Heads of State and Government held in Johannesburg in December 2020, decided that the start of trade under the African Continental Free Trade Area (AfCFTA) shall officially commence on 1 January 2021 on the basis of legally implementable and reciprocal schedules of tariffs concessions.

The 7th Meeting of the AfCFTA Council of Ministers responsible for Trade, on 10th October 2021, adopted the Ministerial Directive on the Application of Provisional Schedules of Tariffs Concessions. This Ministerial Directive provided a legal basis for the countries that had submitted their tariff schedules in accordance with the agreed modalities to trade preferentially amongst themselves.

The Ministerial Directive was adopted by the Assembly of Heads of State and Government in February 2022. However, as commercially meaningful trade had not commenced under the AfCFTA, the AfCFTA Secretariat embarked on a solution-based approach in the form of an AfCFTA Initiative on Guided Trade. During the 9th Meeting of the Council of Ministers held in July 2022, H.E. the Secretary General of the AfCFTA, Mr. Wamkele Mene, announced the AfCFTA Secretariat Guided Trade Initiative.

The AfCFTA Guided Trade Initiative intends to achieve its goal through matchmaking businesses and products for export and import between these interested State Parties in coordination with their national AfCFTA implementation committees.

The specific objectives of the AfCFTA Guided Trade Initiative are:

  1. to allow commercially meaningful trading under the AfCFTA;
  2. to test the operational, institutional, legal and trade policy environment under the AfCFTA; and
  3. to send an important positive message to the African economic operators.

The representatives from the Secretariat, Ghana National AfCFTA Coordination Office (AfCFTA NCO), interested State Parties including the diplomatic missions in Ghana, Ministries of trade and industry, the customs administrations, the private sector including logistics companies and the AfCFTA implementation partners, are part of the Initiative.

The initiative has attracted participation of EIGHT (8) State Parties – Cameroon, Egypt, Ghana, Kenya, Mauritius, Rwanda, Tanzania and Tunisia.

The products earmarked to trade under the AfCFTA Guided Trade Initiative include: Ceramic Tiles; batteries, tea, coffee, processed meat products, corn starch, sugar, pasta, glucose syrup, dried fruits, and sisal fibre, amongst others, in line with the AfCFTA focus on value chain development. 

The expected outcome of the Initiative is the shipments under the AfCFTA to take place within the margins of the next Meeting of the Council of Ministers on the 07 October, 2022

JUSTIFICATION

The interested State Parties represents 5 African regions.  The AfCFTA Guided Trade Initiative will serve as a gateway to encourage continued trade under the AfCFTA, resulting in a multiplier effect and increased opportunities for SMEs, Youth and Women in trade and ultimately establishing sustainable and inclusive economic development.

WAY FORWARD

There are more ongoing activities related to shipments of products ahead of the anticipated launch of the AfCFTA Guided Trade Initiative on the 07 October, 2022. The next logical steps towards the sustainability of the initiative is to the sustainability beyond October 2022. The ultimate objective is to ensure that AfCFTA is truly operational and the gains from the initiative are improved implementation in order to achieve increased inter-regional and intra-Africa trade that would yield economic development for the betterment of the continent at large.

Media Contact
Grace Khoza – Principal Communications Advisor
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