Hopefully, a sweltering sun in Africa has not caused AU experts to see mirages of intra-regional finance. Providing for intra-African investments in the current context of the continent is like offering classes on how to make planes to students living in countries that cannot yet make cars: Virtually all the real action takes place elsewhere. Instead of negotiating a chapter on investment, delegates must prioritize a chapter on how AU members can build their capacity to engage in deeper economic relations, especially on how to leverage FDIs in natural resources to develop adequate infrastructure for intra-African investment.
African Continental Free Trade Agreement
Welcome to Afronomicslaw.org, a blog on the international economic law landscape as it relates to Africa. A major goal of this blog is to complement current analysis of international economic law issues as they relate to Africa in the blogosphere. We believe that this blog is particularly timely because there are significant international economic law developments taking place in Africa that invite more contemporaneous reflection and discussion.
The AfCFTA will over a period of 15 years after entry into force progressively eliminate tariffs on intra-African trade, making it easier for African businesses to trade within the continent and cater to and benefit from the growing African market. Consolidating this continent into one trade area provides great opportunities for trading enterprises, businesses and consumers across Africa and the chance to support sustainable development in the world’s least developed region.
The AU’s focus should be to design the AfCFTA investment protocol as an instrument that will treat all investors equally, and that will also foster harmonisation at continental level from the top down. My argument is still valid although my solution will not resolve questions such as divergent policies and views with regard to whether investor state disputes should be referred to arbitration or litigation. Central to this issue is that African states have different levels of the rule of law. This means that under circumstances where the rule of law is poor, obliging investors to refer disputes to the courts of a host state riks denial of justice.
In order for the benefits of the AfCFTA to trickle down, African countries need to adequately consider ICBT when designing and implementing trade policies. Trade policies will be incompletely conceived and may not sustain the economic development goals that integration is supposed to deliver if African countries do not adopt a holistic approach that recognizes the importance of ICBT.