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Amaka Anku, Africa analyst at Eurasia group, described the deal as a positive step but said implementing the AfCFTA was still “a long way from taking off”, with concerns on how many of the new regulatory agencies for the trade agreement would be funded.
The AU estimates that the deal will lead to a 60-percent boost in intra-African trade by 2022.
At the moment, African countries trade only about 16 percent of their goods and services among one another, compared to 59% in Asia and 69 percent with European countries.
Country’s conflicting motives is also expected to be an obstacle during negotiation. For instance, Nigerian officials have expressed concern that the country could be flooded with low-priced goods, confounding efforts to encourage moribund local manufacturing and expand farming, according to Reuters news agency.
On the other hand, South Africa’s manufacturers, which are among the most developed in Africa, could quickly expand outside their usual export markets and into West and North Africa, giving them an advantage over manufacturers from other countries, said John Ashbourne, the senior emerging markets economist at Capital Economics.
The vast difference in countries’ level of economic development is another complicating factor in negotiations. Nigeria, Egypt and South Africa account for over 50% of Africa’s cumulative Gross Domestic Product, while its six sovereign island nations represent about 1%.
“It will be important to address those disparities to ensure that special and differential treatments for the least developed countries are adopted and successfully implemented,” said Landry Signe, a fellow at the Brookings Institution’s Africa Growth Initiative.
Economists say other challenges likely to remain include poor road and rail links, excessive border bureaucracy and petty corruption that have held back growth and integration.
Security on the continent
Also on the summit agenda was security — an issue afflicting the Sahel in particular. Summit host Niger has faces constant attacks by jihadist groups.
Its fellow members in the G5-Sahel security pact – Chad, Mali, Burkina Faso and Mauritania – sought backing at the AU summit to push for a greater UN security force to address the terror threat.
The countries hope to activate Chapter VII of the UN Charter, a Nigerien security source told AFP. The chapter allows for the UN Security Council to determine a threat to peace and propose measures, including military deployment, to deal with it.
“No prosperity, no integration is possible without peace,” said Faki, who stressed the importance of an AU Peace Fund launched in 2018 to finance security activities and called on member states to fulfil their financial promises. So far, only $116 million has been received for the envisaged $400-million fund.
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