Moscow — allAfrica sat down with Ambassador Albert M. Muchanga, African Union Commissioner for the Department of Trade and Industry, while at the Afreximbank meetings in Russia. Muchanga speaks on the progress of the African Continental Free Trade Agreement (AfCFTA), the perception that the reality on the ground may hold up the implementation of the trade deal and how Africa will no longer hold a “begging bowl”…
Right now we have 52 countries that have signed the agreement (AfCFTA). The only countries that have not signed the agreement are three – these are Nigeria, Benin and Eritrea. And for Nigeria and Benin, they have been assured me that very soon they are going to sign. So, it is possible that by the time we meet on the 7th of July, maybe Nigeria and Benin would have signed, so we are moving very well regarding signing.
We have 24 countries that have ratified so far. Two above the minimum that are required and the states are very active in about 15 to 20 countries who also ratified. Over time we are going to see a number of countries coming on board to ratify. With regards to my own country Zambia the minister of trade informed me about 10 days ago that Zambia is going to ratify by August this year.
When we meet on the 7th of July for the launch of the operation affairs, the heads of states of the African Continental Free Trade Area will decide the actual start of trading. It is likely to start within six months or within a year and this is necessary in order to sensitize the local business people, as well as to prepare the necessary documentation and distribute all the documentation across Africa.
How are the member stats being helped to deal with the bureaucracy around the AfCTFA?
We agreed on 90% trade liberation that will be the starting point. There’s going to be adjustment on the 10% and this is distributed Into two categories – the sensitive list and the exclusion list. For the sensitive list they are going to gradually be liberalised so that they become part of the 90% which is going to make it 95%. For the developing countries, we going to allow them 10 years and for the least-developed countries we are going to allow them 13 years. Over and above that we are creating adjustment facilities so that countries can finance their operations such as loss of revenue and others so that they are able to continue liberalising.
Illegal border crossings, violence and displacement are major issues on the continent. How will the AfCTFA address that?
We have a protocol on free movement of people, right of residence and right of establishment so people will be able to move across African continent borders without any unnecessary obstacles, and in that way issues of illegal border crossing will disappear. I always say that the criminals are always ahead of society anywhere in the world in any part of the world. They are very well-coordinated and very well integrated and we are not catering for those. There are law enforcement processes that can capture the criminals when they commit actual crime but for an ordinary citizen – let us make their lives very easy by moving across Africa without any undue disadvantages. We are going to have an African passport to facilitate that, then within that protocol there is also going to be mutual recognition of professional qualifications so that if for example I come from Zambia and have a Zambian qualification and want to work in Kenya, I can easily work without any problems.
We are also working on the mechanism to mainstream cross-border trade so that it is part of the trading statistics. When people talk of low-levels of inter-African trade, one thing they forget is that a good part of inter-African trade, 23 to 25% of intra-african trade is actually not recorded and if it was captured in the statistics the reality will be that intra-african Trade could jumped from the level of 15 to 18% to about 35 to 50%.
How are you going to make sure that all countries comply with AfCTFA?
We are going to establish a secretariat that is going to monitor how the agreement is going to be implemented. Then over and above, we are going to have regular officer admissions, for example we are going to have directors of general customs and if there are problems at the border they will be able to share experiences.
For example there’s going to be an online monitoring elimination mechanism. If that happens in real time there’s going to be a threat alert to the secretariat that there’s a problem and we’ll find a way to resolve it. If it fails there’s going to be an adjudication mechanism where somebody who is aggrieved can take the other party to court for arbitration.
What do you say to those who believe that the reality on the ground doesn’t match the rhetoric being shared about the AfCTFA, and that it still has a long way to go?
The issues that when we started a lot of people did not believe that we are doing the right thing, in fact when we started the negotiations in 2015, we gave ourselves a target of finishing the negotiations by 2017. There was a lot of cynicism, saying it could take 15 to 20 years to negotiate an agreement and for an example Namibia was negotiating to enter the US market to export beef which took them about 12 years but the will was there.
We finished the negotiations in two years as planned and when we went to sign the agreement a lot of people did not expect more than 28 countries to sign, when we opened it for signatures 44 countries were able to sign. When we told the people that we were going to work very hard as the secretariat to ensure that the agreement is ratified within a year, a lot of people were saying the reality on the ground is that it takes 5 years for an African Union agreement to be ratified.
We said we were going to make it different. We did it in one year, one month, one week and one day so the reality on the ground can be perception, and perception is not necessarily reality at all times. There is a very huge commitment by African leaders, member states within and also within the corporate sector to ensure that we develop Africa on the basis of of continental integration. Immediately we started with the signing of this agreement and number of corporate entities came forward wanting to come to a memorandum of understanding and the first one was Afreximbank, and we are cooperating with them.
The second one was with the AfroChampions – these are African business people who want to expand investment in Africa and to the rest of the world and they are working on two major programmes; one of which is meeting the infrastructure financing gap of Africa within 10 years. The next one is to come up with a robust program of agro-processing.
We have excited even the diaspora, a member of the African Diaspora forum came forward to say can we enter into a memorandum of understanding to develop an African platform on e-commerce that is aimed to establishing export trading companies and other SMEs and it is targeted to create 600 000 SMEs between now and 2023. And if SME produces 5 jobs, that is going to generate $3-million in that time, so we have seen a lot of inspiration coming out of this establishment.
When they are saying the “reality on the ground” they are still seeing what is happening through an mode where things are moving very, very slow and Africa and Africans are not confident. Africans have said aid is welcome but principally we are going to develop on our own and we are ready to work.
I mentioned that we decided to mobilize African youth by saying let us have a pavilion for youth startups at the African trade fair in Kigali next year and a lot of young Africans are very excited and they’re saying this is what we have been looking for, so very soon we are going to start the process of selection, so people have been inspired, the energy levels have risen and the impossible is going to happen.
Africa’s agreements with China and now Russia may seem like a continuation of international involvement in the continent’s economy…
What I’m saying is we are creating a new Africa. The Africa of dependence we are putting it behind us when we meet the Chinese we are talking about win-win cooperation, not dependence of Africans on China. When we are going to meet Russia in October we are going to be talking about the win-win situation. People should forget the Africa that thrives on aid, people should see an Africa that says we have the capacity to create our own future and we are creating our own future through the African Continental Free Trade Area and we want to be treated as equal partners. We are not coming with the begging bowl.
Do your counterparts like Russia, China and the U.S. think like that?
Yes they do, last week I was in Addis Ababa. I was with Americans on the issue of the AfCTFA and this is the message I gave. On June 22 I’m going to Beijing on the Belt and Road initiative and the key party will be the African Continental Free Trade Area and I’m still going to give the same message.
Africans have said we want to create our own future by creating a big market for ourselves because when you create that big market there’s going to be greater manufacturing in Africa and exportation of commodities. There is going to be greater agro-processing and when you do agro-processing Africa is going to transform itself from a net importer of food to a net exporter of food. It’s a cultural mindset that this is impossible. Nelson Mandela said “It seems impossible until it’s done”.