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Wamkele Mene was recently appointed Secretary General of the African Continental Free Trade Area Secretariat. Due to the effects of COVID-19, free trading for countries that have ratified the agreement cannot begin on July 1, 2020 as was originally scheduled. He spoke to Kingsley Ighobor about the way forward.
Describe the impact of COVID-19 on AfCFTA so far?
The African economy was set to grow at about 3.4 % in 2019 and projected to increase to 3.9% in 2020, but COVID-19 has had a very negative impact. We know that over 53% of Africa’s exports go to countries, particularly Europe, that are themselves suffering from the pandemic. That has had a subdued effect on our export markets. Our services sector is set to fall by between 20% and 30%, particularly travel and hospitality. We must find ways to mitigate the effects of the pandemic, but the primary focus for now is to save lives.
Given the current situation, any idea when free trading can begin?
We have recommended to the AU Assembly of Heads of State, which is the body with the authority to delay the trading date, that given the current public health crisis and the need for some technical work to be concluded, that we cannot meaningfully trade [under AfCFTA] on 1 July.
Does this mean free trading will not begin until the pandemic is defeated?
We are exploring other ways of continuing our technical work if the pandemic continues. Trade negotiations are very technical. We negotiate in four languages (English, French, Arabic and Portuguese). We must make provision for the different time zones in Africa. And there are requirements for confidentiality. All these have to be taken into account before we can continue the negotiations, if at all we are able to continue the negotiations on virtual platforms. We would like to resume our work as soon as the pandemic is contained. But if for whatever reason, the pandemic continues, which we hope it will not, we are exploring other ways of advancing our negotiations.
The pandemic could potentially decimate African economies. How will you regain momentum?
We have short and long-term tools. A short-term tool is that our Heads of State agreed to establish trade corridors to enable the transit of what the African Union Centers for Disease Control and Prevention (Africa CDC) refers to as “essential goods” or germ-killing products such as soaps that are essential to combat the pandemic. These products get priority transit through the borders, particularly in landlocked countries. Second, the African ministers of trade are exploring the possibility of reducing duties on these essential products so that they become affordable and accessible to people. This is a temporary measure.
In the long-term, it is our view that accelerating Africa’s industrial development is very important for reconfiguring our supply chains, establishing regional value chains and boosting the manufacturing of essential value-added products.
There is a review of our intellectual property rights; the extent to which our intellectual property regimes enable Africa to have a generic drug industry to ensure that we have access to affordable healthcare.
Finally, we are looking at the actual AfCFTA agreement. Many countries in Africa do not have the monetary policy space, the fiscal policy space to provide large bailouts in the trillions of dollars for economic recovery. Therefore, for Africa, the stimulus package is the actual AfCFTA, the implementation of this agreement. Increased intra-African trade is what will drive economic development post-COVID-19.
Free trade in Africa was expected to boost intra-African trade from 18% to about 50% within a given timeframe. Is your original timetable still valid?
We have an objective of reaching 50% intra-African trade between now and the year 2030. There is not much time remaining. Apart from COVID-19, reaching 50% intra-African trade, and hopefully above that, depends on our capacity to accelerate regional value chains and the manner and pace in which we implement the agreement.
