Navigating trade harmonisation in African regional economic integration: Focus on AfCFTA.
When contemplating the Africa Continental Free Trade Area (AfCFTA) and its implementation, numerous complexities arise, particularly considering that most African nations are members of one or more Regional Economic Communities (RECs), each with its own set of rules, regulations, and preferential tariffs. It, therefore, becomes difficult to determine some non-tariff barriers that a country may put up to protect a vulnerable domestic industry.
Indeed, Tanzania’s dual membership in both the Southern African Development Community (SADC) and the East African Community (EAC) presents a unique challenge. This situation highlights the need for greater harmonisation of taxes and a stronger push towards regional integration within the EAC. Not all challenges in regional trade, particularly non-tariff barriers, can be attributed solely to protectionist motives. Sometimes, issues arise due to ignorance or unwillingness to implement specific agreements. For instance, Kenya’s occasional disregard for certain provisions of the European Union – Kenya Economic Partnership Agreement in favour of the EAC Common External Tariff (CET) has negative implications for certain industries.
This complexity can be transposed to the AfCFTA, which is not a customs union but a Free Trade Area with eight RECs, each with its own complexity. This is why it is important to read treaty agreements and know how to interpret them, as it is important to resolve disputes that will certainly arise.
The Vienna Convention on the Law of Treaties (VCLT) is known as the ‘Treaty on Treaties’ and is the law used to draw up and interpret treaties. The VCLT has been ratified by 116 countries to date, even though countries such as the US have not ratified it and only recognise parts of it. Should disputes arise in treaties, it is the go-to law. The VCLT aims to clarify the meaning of treaties, recognising that parties to treaties interpret them continually. The VCLT provides provisions for the interpretation of treaties to ensure consistency and clarity in their application. Domestic law courts may have a duty to interpret a treaty according to VCLT, and firms embroiled in a dispute may approach them for resolution. There are many examples of trade dispute resolution that can be drawn from various treaties.
The AfCFTA protocol on rules and procedures for the settlement of disputes is similar to the World Trade Organization’s Dispute Settlement Understanding (DSU). Once again, there are overlaps in the jurisdiction of the AfCFTA and RECs. For private parties to file a dispute, they must resort to either the East African Court of Justice or the COMESA Court of Justice, depending on the regional economic community within which the dispute arises. So far even with the Interim Guided Trade Initiative that allowed countries to trade starting October 2022, there have been no disputes reported. It is only a matter of time before we see how this protocol will be brought to bear.