African countries signed Free Continental Trade Bloc Despite Pandemic

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Despite a second wave of coronavirus in many African countries, the continent on January 1 launched the world's largest trade bloc after the World Trade Organization. Every African nation except Eritrea has signed on to the African Continental Free Trade Area and countries including Nigeria are developing safety guidelines for trade during the pandemic.

The launch of the African Continental Free Trade Area was initially scheduled for the middle of 2020 but postponed due to the coronavirus pandemic.

African governments forged ahead with its launch this month despite many African countries recording a second wave of the deadly virus, saying the trade deal could potentially boost African economies affected by COVID-19.

But in some countries, such as Nigeria, authorities are dealing cautiously with trade by screening people and goods. 

Joseph Attah is a Nigerian customs public relations officer.

"We are looking at how we can ensure that things that are brought in or taking out are not things that can compromise national economy and security. And in doing this in this period of COVID-19, we keep to NCDC rules," he said.

Nigeria is among over 30 African nations that ratified the treaty by December 2020. All 55 countries except Eritrea had originally signed on to join the agreement.

Nigerian authorities reopened its borders in December after they were closed for over a year and said the nation was ready to trade with its neighbors.

But this time around, with more scrutiny, says Attah.

"Abuse of rules of origin will be definitely one of the major threats, smuggling will be there too considering our porous borders and the fact now that it's free, influx of substandard goods and of course there will be negative impact on government revenue because you're saying these things are now coming duty free,”  he said.

"Rules of Origin" means all the goods traversing borders must be made within the African continent, not imported.

The idea is to boost intra-Africa trade, which is low at around 16 percent compared to about 68 percent for Africa’s commerce with Europe and 59% for Africa’s trade with Asia.

The continent has a combined GDP of $3 trillion. Experts say the trade deal could expand intra-Africa trade by over 50 percent and the accord contains a dispute resolution mechanism to handle trade disputes that may arise.

"One good thing about the Africa free trade area is that it has a dispute resolution mechanism. And that is very different because ECOWAS didn't have that," said Ken Ife, a macroeconomist and ECOWAS consultant. "Member states are expected to exercise due diligence in relation to their roles and they have to be accountable and answerable to any violations.”

Many African countries are counting on Nigeria's participation in the trade deal to boost the pact.

Nigerian authorities have created a National Action Committee consisting of customs, security, and health officials to oversee the country’s trade dealings with other members and advise government accordingly.