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African countries agree to continental free trade area


The deal would create the largest free trade zone in the world by participating countries. The African Union has said businesses currently pay more to export to other African countries compared to outside the continent.

Forty-four African countries on Wednesday signed up to create a free trade agreement within 18 months in an effort to boost meager intra-continental trade.

The agreement, known as the African Continental Free Trade Area (CFTA), was signed at an African Union (AU) summit in the Rwandan capital Kigali and will, if implemented, be the world's largest free trade zone in terms of member countries.

"Our peoples, our business community and our youth in particular cannot wait any longer to see the lifting of the barriers that divide our continent, hinder its economic takeoff and perpetuate misery," AU Commission Chairman Moussa Faki Mahamat said.

Read more: African Union's plans for free trade divide Africa

Creating wealth

Leaders hope the deal, which still needs to be ratified at the national level, will help boost meager levels of continental trade.

Trade between AU members stands at a relatively low 15 percent of the bloc's total commerce and has been cited as a factor for the continent's enduring poverty.

Average tariffs across the continent stand at 6.1 percent, according to the AU. The bloc has said African businesses pay a higher premium when they export to other African countries compared to when the export to outside of the continent.

Read more: Will the African Union achieve better efficiency?

01:37 mins.
Business | 18.07.2016

Open borders for Africa: an idealistic project with many barriers

Nigeria out

Eleven countries, including Nigeria — the continent's most populous country and its largest economy — did not sign the deal. Nigeria's president skipped the summit, citing opposition from national trade unions.

AU Trade Commissioner Albert Muchanga nevertheless told Reuters news agency he thought Nigeria would come around to signing the agreement. "They are still doing national-level consultations and so when they finish they will be able to come on board," he said.

If all 55 AU members eventually sign up, the deal will encompass 1.2 billion people and create a bloc with a cumulative GDP of $2.5 trillion (€2 trillion).

Read more: Africa's future depends on education

Highlights from 50 years of African unity
A woman at the head

In 2012, Nkosazana Dlamini-Zuma became the first woman to be elected President of the African Union Commission- the highest rank in the AU. After her first 100 days in office, observers said that the former South African interior minister had set a new agenda for the AU. On May 25, 2013, the alliance of 54 states celebrates its 50th birthday.

Highlights from 50 years of African unity
Unity against division

When the Organization of African Unity (OAU) was formed on May 25, 1963, all 30 independent countries were on board. The political union was aimed at preventing a division of the continent. Under the influence of the major Cold War powers, the African states were divided into pro- and anti-western factions. Here is a photo of the summit of 1966.

Highlights from 50 years of African unity
Pioneers of Pan-Africanism

Kwame Nkrumah (left), Ghana’s first president, and Ethiopia’s Emperor Haile Selassie (center) were among the founding fathers of the OAU. The Pan-Africanist Nkrumah had a vision for a “United States of Africa”, which would be strong against the colonial powers and develop a common market. But the countries that had just achieved their independence did not want to go that far.

Highlights from 50 years of African unity
The common opponent

The most important and meaningful common goal of the OAU’s first decades was the fight against the racist apartheid regime in South Africa. Already during its first year, the OAU formed a Liberation Committee and in 1970 it began supporting the armed struggle against the apartheid regime.

Highlights from 50 years of African unity
New momentum for the economy

With the Lagos Plan of Action of 1980, the OAU wanted to give Africa’s economic development a boost. The agreement was aimed at creating a common market by the year 2000. But like many of the organization's other schemes, the plan remained just that - a plan. In 1991, member states signed the Abuja Treaty, which stipulated that there should be an African Economic Community by 2025.

Highlights from 50 years of African unity
Controversial liberation policy

In spite of its policy that the status quo of country borders will not be interfered with, the OAU recognized the liberation movement Frente Polisario of the “Democratic Arabic Republic of Sahara” (Western Sahara) in 1982. After that Morocco decided to leave the organization. Until today, it is the only country that has left the OAU voluntarily.

Highlights from 50 years of African unity
The alliance criticized

The case of Western Sahara remains the sole example of the OAU taking a political stand. That is because it was very consistent about following its policy of non-interference. Because of this, some intellectuals called the yearly summits in Addis Ababa the “Dictators’ Club.” One of the few critics was Yoweri Museveni who took over power in Uganda in 1986.

Highlights from 50 years of African unity
Unpopular military leaders

In the early 1990s, the OAU took on a new political direction. Africa wanted to take responsibility for its conflicts. It installed the so-called mechanism for conflict prevention, management and resolution. When the military in Burundi carried out a coup in 1996, the OAU reacted with sanctions. But the mechanism remained weak. During the genocide in Rwanda in 1994, the OAU didn't take any action.

Highlights from 50 years of African unity
At last

A big moment of celebration for the OAU was when South Africa joined in 1994, 30 years after the organization was formed. Now the country plays an important role in Addis Ababa - for some, too important a role.

Highlights from 50 years of African unity
The beginning of a new era

After the end of the Cold War and the liberation of South Africa from apartheid, the OAU, from 1999, looked for a new beginning. That was presented by Libyan leader Muammar Gadhafi (seen here at the summit in 2006). He revived the Pan-African idea of having a “United States of Africa”. He also used his wealth to pay the fees for many other member states.

Highlights from 50 years of African unity
The OAU becomes the AU

But Gadhafi’s idea was not accepted. After the official transition to the African Union (AU) took place in 2002 in Durban, South Africa, his plan split the union into pro and anti factions. The founding agreement of the AU allows the union to turn away from the policy of non-intervention.

Highlights from 50 years of African unity
Powerless institution

The AU took the structure of the European Union as a model and also wanted to form a Pan-African parliament. In 2004 the organ made up of 235 representatives from 47 countries met for the first time. The parliament is located in the small South African town of Midrand. Its long distance from the AU headquarters in Addis Ababa is a symbol of the political influence of the parliament.

Highlights from 50 years of African unity
New dedication to peace

At the beginning of the new century, 20 percent of all Africans were affected by violent conflicts. That is why bringing peace became the top priority of the AU. In 2004 it formed the Peace and Security Council which can also deploy peace-keeping troops. In the same year the Union sent soldiers to protect the residents of Darfur in Sudan. The challenges remain considerable.

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Read more: African Union 'must finance' itself

Leading integrationist project

Negotiations over the agreement began in 2015. The AU sees it as one of the leading projects aimed at integrating the continent.

Multiple sub-regional free trade zones already exist, but they have only seen limited progress since their establishment.

Twenty-seven AU countries on Wednesday also agreed to a separate deal to allow for the free movement of people across the continent.

amp/kl (AFP, Reuters, AP)