Regional Trade Agreements In Africa

Some of Africa`s difficulties are due to small, fragmented and partially isolated markets. After independence, many African countries used development strategies, including the creation of regional economic communities (RECs). However, many UCs have overlapping memberships and appear to complicate rather than facilitate trade relations between African countries. African countries have taken steps to integrate the continent by creating a European-wide free trade area. The section contains various indicators of trade structure, trade in services, investment flows, trade facilitation, tariffs and non-tariff measures, as well as exchange rates. Roberto Echandi is the senior private sector specialist at ETIRI. It focuses on research and policy advice on issues related to cross-border trade in services, negotiations, implementation and maximizing the potential benefits of deep integration trade agreements and the AfCFTA negotiation and implementation process. The Framework Agreement on Continental Free Trade (CFTA), signed in 2018 by 44 African countries, pursues ambitious long-term goals to deepen integration among African Union member states and build a prosperous and united Africa. The main objectives of these countries are to facilitate, harmonize and improve the coordination of trade rules, as well as to address the challenges posed by many overlapping trade agreements across the continent. Through this agreement, African economies hope to strengthen the competitiveness of local industries, achieve economies of scale for domestic producers, better allocate resources and attract foreign direct investment. Given that the global economy is booming due to the COVID 19 pandemic, the creation of AfCFTA`s huge regional market is a great opportunity to help African countries diversify their exports, accelerate growth and attract foreign direct investment.

Maria Filipa Seara e Pereira advises the World Bank in the Trade Regional Integration Unit (ETIRI). It focuses on international trade and international development issues, including modelling, trade policy, trade distribution effects and global value chains. To illustrate these factors, we should cite some examples of the performance of some countries after joining the RTA: (i) Rwanda, a domestic economy, the resource-poor economy, and the EAC; and (ii) Liberia, a resource-rich economy on the coast, and ECOWAS. Rwanda joined the ABC in 2007. While the shift to the Common External Tariff (CET) has increased Rwanda`s exports due to lower tariffs on intermediate consumption, the cost of living has been negatively affected by the poor population, due in part to higher prices for basic foodstuffs such as sugar, whose imports from Kenya have replaced more efficient external producers (from Melo Collins and 2011). Even for Liberia, with ECOWAS accession to the CET, while customs revenues are expected to increase, higher average protection (from 5.3% to 13.6%) De Melo and Mancellari, 2013, are expected to have a negative impact on the consumption basket of the poorest sections of the population. In addition, estimates show that about 90% of new intra-regional imports following the introduction of the CET would be distracted by existing external trading partners, resulting in net negative welfare effects. Maryla Maliszewska , lead author, is a senior economist in Trade and Regional Integration Unit (ETIRI) at the World Bank. His area of expertise covers various aspects of trade policy and regional integration, with particular emphasis on the impact of trade on poverty and income distribution.