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AfCFTA commences but not free trade yet

On 1 January 2021 the member states of the African Continental Free Trade Area (“AfCFTA”) began trading under the AfCFTA.

This followed the delay of the original implementation date of 1 July 2020 as a result of the coronavirus. Under the AfCFTA’s Protocol on Trade in Goods, member states must phase out tariffs on 90% of goods over the next five to ten years depending on member states’ least developed country status and subject to some exception. A remaining 7% of all goods will become duty free over the next ten to thirteen years and the balance of 3% of goods will continue to attract duties.

However, although the AfCFTA is now operational for trade in goods, member states have yet to finalsie their tariff reduction schedules as well as finalise Annex 2 to the Protocol on Trade in Goods, being Rules of Origin. These two components are critical to ensure free trade in goods amongst AfCFTA member states as the tariff reduction schedules bind the tariff reductions that member states commit to and thus ensures business certainty whilst rules of origin ensure that only goods deemed to originate in AfCFTA member states are afforded the preferential treatment of duty free access to the markets of all AfCFTA member states. It is anticipated that these two critical components will be finalised by July 2021, however it may be subject to further interuptions and delays.

For further information on the AfCFTA and trade thereunder, kindly do not hesitate to contact us.

Rian Geldenhuys
© Trade Law Chambers 2021


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