The African Continental Free Trade Agreement: Making it count for people and planet
With the stroke of a pen, African heads of state gathered in Kigali, Rwanda on March 21, 2018, signed off on the African Continental Free Trade Area (AfCFTA) deal – which some pundits have characterised as the largest free trade agreement since the World Trade Organization. This signing comes at an opportune moment given the compounded socioeconomic challenges facing the continent.
Africa’s Reality Check
Amidst the pomp and colour in Kigali, unanswered questions continued to confront these continental heads. I am talking of mothers burying their 5-year-old children for lack of adequate nutritious food, as more than 240 million people go hungry. I am talking of Africa’s low economic productivity – an estimated 2000 percent lower than that of developed regions – primarily because of its reliance on exporting commodities at the expense of value-added products despite its comparative advantage. As an example, the continent earns a mere 10 percent of the total extractable value from its agro-value chains due to low value addition. In the cocoa value chain, where the largest producer is in Africa, out of the over $100 billion in revenue made from chocolates alone, Africa receives a dismal 2 percent, meaning $98 billion of potential revenues and jobs is lost.
Related to the low productivity is unemployment. I am talking of up to 12 million youth joining the labour market every year to compete for just 3 million jobs – and the number is projected to reach over 350 million competing for fewer jobs in less than 17 years. It’s what some have called a ticking time bomb. I am talking of youth in despair, risking a burial on the bed of the Mediterranean Sea or sold in modern-day slave markets.
And I am talking of climate change, the elephant in the room, robbing the content of the little income it currently generates.
Is AfCFTA – Africa’s weapon against compounding challenges?
AfCFTA, already signed by 44 of the 55 AU countries and expected to enter into force by the end of 2018, is set to consolidate Africans in a 1.2 billion-strong market with a combined GDP of over $2.3 trillion (or over $3.4 trillion by other estimates). It is projected to increase intra-Africa trade, currently standing at a mere 12 percent, by a whopping 52 percent – taking it to about 70 percent by 2022. This is an ambitious figure, and is higher than trade within the European Union, currently the world’s highest at 65 percent.
The agreement also aims to offer free movement of people to consolidate labour opportunities across the continent and ward off the brain-drain – which claims up to a third of Africa’s most skilled people – and would transfer talent across African borders instead. AfCFTA will also create unprecedented demand for local manufacturing and industrialization, especially in agriculture. I also am talking of Africa’s rapidly growing middle class, currently at 300 million people, and expanding local markets for value-added agro-produce worth $150 billion annually as part of overall consumer spending projected to reach $1.4 trillion by 2020.
While AfCFTA and the trillion-dollar opportunities it offers could allow Africa to wear the global trade crown, the elephant in the room is how the treaty will translate to food, secured homes, increased economic productivity, wealth and incomes for the continent’s youth and citizens.
A Continental Compliance Standard
The AfCFTA brings intra-Africa market opportunities, but for this to fully flourish, there is a need for shared compliance standards. Considering Africa’s disproportionate vulnerability to climate change, the future must ensure the process of producing, marketing and supplying does not compromise the integrity of the very planet and ecosystems that underpin production in the first place. We need standards to ensure Attekke processed from Cote D’Ivoire cassava can be bought from a Kenyan supermarket with the highest quality supported by regulatory approvals, and that ecosystems were not destroyed while producing it, that zero net emissions were emitted in its processing and marketing. This need was endorsed by African ministers and policymakers at the 16th African Ministerial Conference on the Environment (AMCEN) in Libreville, Gabon. It is supported by Ecosystems Based Adaptation for Food Security Assembly (EBAFOSA), itself a creature of AMCEN, in developing compliance standards along the entire supply chain beginning with on-farm production.
EBAFOSA stresses three criteria. The first is Climate and Environment compliance. This aims to ensure that nature based approaches that enhance ecosystems are used at the primary production level to ensure water, pollinators or healthy soils are protected and enhanced during production. It also aims to ensure that processing is powered with clean energy, and that marketing and supply chains reduce carbon footprints through Information Communication Technology (ICT). The second criteria is Health Compliance. This aims to ensure that nature based approaches and non-chemicalized inputs are used in production.
The third is Quality and Safety Compliance, so that Africa creates an open market for healthy, high quality, environmentally friendly agro-produce. EBAFOSA compliance standards do not reinvent the wheel but rather connect the dots to ensure from production, to processing and market and consumption, all the dots are connected within a continuum.
One of my favorite African proverbs says, “A man does not wander far from where his corn is roasting.” As implementation of AfCFTA gathers steam, the EBAFOSA Compliance Standards represent a ready tool to expedite practical implementation of the deal in a manner that will accelerate Africa’s socioeconomic – a transformation for its people, while protecting the very planet we must protect for ourselves and for those yet to be born.
Dr Richard Munang is Africa Climate Change & Development Policy Expert. He tweets at @RichardMunang. Mr Robert Mgendi is an Adaptation Policy Expert. The views expressed here are those of the authors and do not necessarily represent those of the institution with which they are affiliated.
Image credit: Government of South Africa/GCIS