What You Need to Know About the African Continental Free Trade Area

While it is sometimes confused with the African Free Trade Zone, the African Continental Free Trade Area (AfCFTA) is a free trade area which, once fully operational, will be the largest free trade area in the world by number of countries. The Area was created by the African Continental Free Trade Agreement, with the aim of increasing Africa’s presence in our global economy by bettering intra-Africa trade flows and attracting foreign investment. This would be done by initially removing tariffs on 90% of goods within five years for non-LDS countries, 10 years for LDS countries and 15 years for G6 countries. Here are some important things to know about AfCFTA.


Who’s Involved

The agreement establishing AfCFTA was brokered by the African Union and adopted by 44 of the 55 member states on 21st March 2018. All African Union countries, apart from Eritrea, had become signatories of AfCFTA by February 2019. However, if AfCFTA is to become binding on the signatory states, it needs to be approved in accordance with each country’s internal procedures. At the time of writing this, only 28 of the African Union states have ratified the agreement. AfCFTA came into force on 30 May 2020.


The Protocols

There are 6 protocols contained in the AfCFTA. Only the first 3 have been concluded:

  • Protocol on Trade in Goods – aims to create a liberalised single market for free flow of goods within the African continent.
  • Protocol on Trade in Services – aims to enhance the competitiveness of services, accelerate industrial development and increase both domestic and foreign investment.
  • Protocol on Rules and Procedures on the Settlement of Disputes
  • Protocol on Investment
  • Protocol on Investment Property Rights
  • Protocol on Competition Policy


What Has Been Implemented

In terms of implementation of the AfCFTA, very little has actually been achieved, and COVID-19 has slowed things down even more. At the 12th Extraordinary Session of the Assembly of the African Union, held on 7 July 2019, it was decided that Tariff Concessions would be submitted at the next ordinary session of the Assembly in February 2020, which they were not. It was also decided that the dismantling of tariffs would happen no later than 1 July 2020, and while a meeting took place virtually, it is not clear what actions have or will be taken.


AfCFTA has the potential to assist Africa during and help the continent emerge from the destruction that the COVID-19 pandemic has caused. We are watching as new developments take place and hope for the promises to be fulfilled. For all your logistics needs, be sure to visit our website or send an email to pricing@centralstation.co.za.

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