The African Continental Free Trade Area in a Decaying Multilateral Trading System: Questioning the Relevance of the Enabling Clause

Abstract

The signature of the African Continental Free Trade Area (AfCFTA) Agreement during the 10th Extraordinary Summit of the African Union (AU) Assembly of Heads of State and Government held on 21 March 2018, in Kigali, Rwanda, marks a decisive turn in African regional economic integration. After speedily securing the minimum threshold of 22 signatures, the Agreement, with the Protocols on Trade in Goods, Services and Dispute Settlement, entered into force on 30 May 2019. While the AfCFTA comes at a very good time for the continent especially by proposing African solutions to African problems, it also happens amidst a backlashed multilateral trading system epitomised by the US-China trade war, the WTO negotiations stalemate and the likely demise of its dispute settlement mechanism, as well as the United Kingdom’s exit from the EU (Brexit).

The AfCFTA’s main aim is to create a single continental market for goods and services, with free movement of businesspersons and investments, and thus pave the way for accelerating the establishment of the continental Customs Union. While the establishment of existing regional trade agreements (RTAs) has not always been conditioned on the satisfaction of the WTO rules on the issue, this article examines the regime under which the AfCFTA should be scrutinised. This calls for the dissection of the pertinence and the desirability of the Enabling Clause as opposed to Article XXIV for this scheme composed of developing and least-developed countries. The paper notes the tendency since 1979 to notify intra-African RTAs under the Enabling Clause contrary to earlier practice.

Keywords: Africa, African Continental Free Trade Area, AfCFTA, Regional Trade Agreement, WTO, Enabling Clause

JEL Classification: K33, O55, F02, F15, O19, O24, P48, P45, N40, F55