Trading under the AcFTA

Trading under the AcFTA: what to expect

Trading under the Africa Continental Free Trade Area (AcFTA) started on the 1st of January 2021. While this is a big deal for Africa trade and Africa integration, a lot of African people are not aware of its implications. In our recent poll on our social media pages asking when the AcFTA started operating, there were varying responses. Even more worrying was the fact that a good number of people are out of touch with the subject in its entirety.

That said, there are a number of expectations African people should have with the commencement of trade under the AcFTA. These include:

Increase of ease in movement of people across Africa

The Africa Continental Free Trade Agreement encompasses a protocol on trade in services. For successful implementation of the protocol, free movement of people is key. Some obvious benefits of movement of people around the continent are, transfer of technology and increased supply of skilled labour.

That said, it has been noted with concern that some African countries apply more lenient rules for obtaining Visas to the West and East as compared to fellow African states. Thus, a lot of ground needs to be covered to make the Agreement a reality. The AU in line with Africa Agenda 2063 launched the Africa passport in 2016[1]. The issuing of the passport has not been successful.  It is hoped that the passport will be rolled out significantly in 2021. With the passport there will be ease in movement of people around Africa. The significant roll out of the passport is definitely a big thing to look forward to.

Efforts to facilitate trade in goods

Needless to say, African countries need to take a number of implementation steps to give effect to the protocol on trade in goods. Some top concerns on trade in goods are,

  • Poor infrastructure network like road and rails within countries,
  • Improved trade facilitation among countries,
  • Harmonization of laws and regulations around trade, and
  • Establishing efficient institutions and means for settling trade disputes.

For the moment one can expect to hear more on actions being taken by the Africa Union and state parties to address the above concerns. Overall, a lot remains outstanding to realize much of the fruits of the AcFTA.

A good question to also ask at this point is on the relationships between Africa, China and other third party states. These third parties are to be integral in developing infrastructure in Africa. As noted, infrastructure in the form of roads, railways and technology are a big component to realizing the most from the AcFTA.

Reevaluation of business focus

Business people will be paying attention to the increased talk of trade among countries. Some important aspects for businesses to look for are, talks on having single currencies in some regions.

For instance, West African states are pursing talks on having a single currency (the Eco currency)[2]. Having a single currency is meant to reduce common difficulties of using different currencies like exchange rates fluctuations. Ultimately, the single currency will help to boost trade among the countries. Such talks are also likely to affect businesses decisions in these regions.


Opinions vary on the future success of the AcFTA and trading under AcFTA. The more pessimistic side of Africans have little to no hope on its success. This camp forms its perspective from looking at the past track record of agreements with Africa. Indeed, several agreements have been signed and lauded in Africa but have never taken off. Additionally, there have been significant failures within Regional Economic Communities in Africa. An often cited example is the collapse of the East African Community in 1977 with subsequent revival. Additionally, political tensions among African states remain a big feature as well as other political struggles.

The more optimistic camp uphold that Africa has been through many revolutions and it is about time for the trade revolution. The camp point to economies within Africa that are succeeding and the potential of African people.

At this point, the jury is out on whether the AcFTA is going to bear much fruit or fail. Be it as it may, a lot is to be expected in the coming days following the launch of the operation of the Free Trade Area.

Listen to our podcasts and talks on various issues around Africa trade here. Also look at future discussions and join in to share your perspective.

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