Addressing NTBs key for African Continental Free Trade Area

The African Continental Free Trade Area (AfCFTA) that came into force on May 30, 2019, was set to create a single continental market for goods and services to boost intra-Africa trade, economic growth and development.

Low levels of intra-Africa trade and high costs of doing business are largely caused by Non-Tariff Barriers (NTBs) that comprise a wide array of regulatory and procedural barriers to trade, except regular customs duties. Regulatory and procedural barriers include customs operations and border documentation requirements, rules of origin documentation and pre-shipment inspections. Other trade barriers come in the form of transport regulations, sanitary and phytosanitary measures (SPS) and technical barriers to trade (TBTs).

NTBs slow down the movements of goods and make the cost of doing business unbearable.

While negotiating AfCFTA, it was revealed that addressing NTBs would be a key milestone to the effective implementation of the AfCFTA. NTBs slow down the movement of goods and costs importers and exporters billions of dollars annually.

The AU has stressed that for the AfCFTA to thrive, operational barriers have to be eliminated, and ensure businesses and traders don’t suffer from undue limitations placed on them as they trade.

“The success of the AfCFTA depends in part on how well governments can track and remove non-tariff barriers,” said Ambassador Albert Muchanga the African Union Commissioner for Trade and Industry.

According to a UNCTAD report, if these barriers are removed, the African economy could gain $20 billion – much more than the $3.6 billion it could recover by eliminating tariffs. The United Nations Economic Commission for Africa (UNECA) estimates that the AfCFTA has the potential to boost intra-African trade by 52.3% by eliminating import duties and could double trade if NTBs are also reduced.

The AfCFTA Protocol on Trade in Goods calls for the elimination of NTBs and establishes a reporting, monitoring and elimination mechanism where the private sector can file a complaint on specific trade obstacles. The complaint is then transmitted to the government of the responsible trading partner to react to the complaint and resolve it within concrete timelines. The reported NTBs also feed into national and regional trade policy improvements.

In this endeavour, the African Union has amplified action to tackle non-tariff barriers and increase small businesses’ use of the tradebarriers.africa tool, a new online reporting platform developed in partnership with UNCTAD. This tool is at the apex, integrating regional reporting portals.

The AU says the web-based tool, a non-tariff barrier reporting mechanism tool which supports efforts to make continental trade easier and less costly by helping African businesses report barriers and supporting their elimination with the help of governments, will enhance transparency, easy follow-up and resolution of reported and identified NTBs.

Through a campaign dubbed #TradeEasier, the AU aims to promote the uptake and use of the tradebarriers.africa, webinar series was organised to start in September 2020. The virtual roadshow of discussions around the continent kicks off in East Africa, through Southern and Central Africa and ends in West Africa.