In an open letter to the continent’s political leaders, prominent figures from the world of African business explain why a full-blown postponement of AfCFTA would be a mistake and how some aspects can be rescheduled. Africa needs AfCFTA both to beat Covid-19 and to speed up post-Covid economic recovery, they say
Reports have been appearing in the international press that the start of trading under AfCFTA has been postponed from July until next year. The truth, however, is that the continent’s leaders are yet to make a formal decision on the matter – a decision that will be made in the next few days.
Without doubt, certain aspects of AfCFTA implementation will have to be rescheduled due to Covid-19. Full blown trade cannot start in July 2020. But rescheduling certain components of the AfCFTA should not be confused with postponing it.
There are aspects of AfCFTA that can be rescheduled because of Covid-19 but there are aspects of the July start of trade that must be implemented – not in spite of but because of COVID-19. This is the conversation we should be having. Which aspects should be rescheduled; and which aspects must start in July 2020?
Covid-19 adds urgency to AfCFTA
For various strategic reasons that we elaborate below, a full-blown postponement of AfCFTA would be a mistake. Covid-19 should accelerate AfCFTA, not slow it down. Africa needs AfCFTA both to beat Covid-19 and to speed up post-COVID economic recovery. The good news is that there are innovative logistical ways in which this can be done.
As the continent’s leaders deliberate on this matter, we wish to draw the following points to their attention.
Phase 1: trade should start in July
Initial AfCFTA trading can focus on essential goods and services needed to fight the pandemic such as pharmaceuticals, personal protective equipment, food products and emergency cross-border transportation services.
E-commerce can lead the way. A special resolution can be passed to approve essential ‘anti-Covid trade’ so that it wouldn’t require completion of outstanding Rules of Origin and Tariff Concession negotiations in order to proceed. Let history record that when the pandemic struck, the Great Flag of AfCFTA was not brought down; it was hoisted high to accelerate trade in the essential medical goods the continent used to win the battle. This will be an important symbolic victory in a time of crisis.
Phase 2: trading should be postponed but negotiations must continue
Full AfCFTA trading should be postponed to early 2021 but continue the negotiations via online videoconferencing platforms. Postponing negotiations until face to face meetings can take place will further delay preparedness for full take-off when the pandemic is over. All indications point to the fact that “virtual work” will be part of everyday life in the post-COVID world. That is why country negotiating teams should do their best to adapt to the changing times now that technology is our best friend.
The AfCFTA should be one of Africa’s main weapons for post-Covid economic recovery but that will not happen if negotiations are postponed. That is why negotiations should continue via videoconferencing platforms so that by the time the pandemic is over, AfCFTA will also be ready for countries and businesses to utilise for post-COVID recovery in the areas of trade, investment, manufacturing, jobs and growth.
Preparing the Secretariat
The AfCFTA Secretariat, which is temporarily operating out of Addis Ababa, should continue with its staff recruitment and operationalise a fully functional virtual office with newly recruited teams working virtually from their homes across the continent. The new Secretariat – with its dynamic young leader – must fully embrace technology, and demonstrate capability to innovate for the crisis period into which it has been born.
Capitalising on the crisis
There is a silver lining in Covid-19 for Africa – it opens the door for industrialisation – and the AfCFTA is the bridge to capitalising on this opportunity.
As a result of the pandemic, the prevailing geopolitics of global manufacturing are being unsettled. Countries across the world are expected to re-balance their over-reliance on distant global suppliers in favour of more proximate regional and local manufacturers. This is the perfect time for Africa to prepare itself to take advantage of this re-balancing to finally pursue a “Made-In-Africa” industrial revolution.
The AfCFTA, its industrial Rules of Origin and other strategic protocols are precisely what Africa needs at this time in order to take full advantage of the new industrial possibilities Covid-19 is provoking. Sticking to a partial symbolic start of trade in July, 2020 and sustaining negotiations electronically will position the continent to optimise the opportunities that will emerge from the need for new supply chains.
On the other hand, postponing it will let other global regions that already have trade blocs move ahead and that will put Africa at an even greater disadvantage.
No grounds for postponement
Many events are being postponed around the world. But the AfCFTA is not an event to be postponed. The AfCFTA is our new reality – it is core to the resilience Africa needs in order to emerge stronger out of Covid-19 and beyond. There are innovative ways to keep AfCFTA on track and we should be willing to explore them. The AfCFTA work should not stop. Africa has been working from home, scientists globally have been collaborating virutally finding cures to this pandemic. The AfCTFA can and must remain on course.
To paraphrase the words of Martin Luther King Jr:
If we can’t fly, let’s run.
If we can’t run, let’s walk.
If we can’t walk, let’s crawl.
Whatever we do, we have to keep moving.
For further information see the AfroChampions Initiative’s AfCFTA Year Zero Report.
Michael Kottoh, Anne-Elvire Kormann-Esmel, Richard Adu-Gyamfi of AfroChampions contributed to this Open Letter which has been signed by the following business leaders:
- James Mwangi, Chairman of Equity Bank Group
- Gervais Djondo, Co-Founder of Ecobank Transnational Incorporated
- Jean Louis Billon, Chairman, SIFCA Group
- Paulo Gomes, Vice-Chair, AfroChampions
- Jas Bedi, African Cotton & Textile Industries Federation
- Nonkululeko Nyembezi-Heita, Chair of Business Leadership South Africa & CEO, Ichor Coal N.V.
- Sherine Helmy, CEO, Pharco
- Abderhamane Berthe, Secretary-General of African Airlines Association
- Babacar Ngom, CEO, Sedima Group
- Adefunke Adeyemi, Regional Director Africa, International Air Transport Association
- Kwasi Adu-Amankwah, General Secretary of ITUC-Africa.
- Busi Mabuza, Chairperson of Industrial Development Corporation of South Africa
- Samba Bathily, Chairman, ADS Group
- David Ofosu-Dorte, Chairman of AB&David Africa
- Walid Loukil, CEO, Loukil Group
- Louisa Mojela, Group CEO of Wiphold
- Edem Adzogenu, Co-Chair, AfroChampions
- Naguib Sawiris, Chairman of Orascom
- Ms Funmi Isola-Folorunso, Secretary General, Africa Shippers Association
- John Nsana Kanyoni, CEO, Tembo Power, DRC
- Paul Fokam, CEO, Afriland Group
- Hisham Ezz Al-Arab, Chairman, Commercial International Bank (Egypt)
- Mohamed M. Abou El Enein, Chairman, Cleopatra Group
- Kola Karim, Chairman, Shoreline Energy
- Kola Adesina, CEO, Sahara Energy
- Kuseni Dlamini, Chairman, Massmart
- Chamsou Andjorin, Director, Boeing SSA, Coordinator Africa Aviation Industry Group