Introduction

The South African government and the African Continental Free Trade Agreement (AfCFTA) Secretariat hosted the 12th AfCFTA Ministers’ Council meeting in Durban, South Africa. The opening ceremony of the AfCFTA Council of Ministers (COM) Responsible for Trade Meeting was followed by South Africa’s launch of Preferential trade under the AfCFTA Guided Trade Initiative (GTI). Participants include the secretary-general of the African Continental Free Trade Area (AfCFTA) Secretariat, Wamkele Mene, Minister of Trade, Industry and Competition of South Africa, Ebrahim Patel, as well as ministers responsible for trade, the diplomatic corps, heads of businesses and media across Africa. The gathering sought to promote trade under the AfCFTA demonstrating processes and how secretariats can work to assist member states. 

They discussed outstanding issues of the Draft Protocol on Digital Trade to finalise the negotiations and submit the Draft Protocol for Ministers’ consideration. According to Tralac (2023), intra-African digital trade is currently low due to fragmented regulatory frameworks, inadequate digital infrastructure, lack of trust and confidence in the digital economy, and the digital divide between and within African countries.

Trade Update on the Host (South Africa) 

The host, South Africa, equally launched its trade under the new preferences set out in the African Continental Free Trade Agreement (AfCFTA). Meanwhile, on Friday 26 January 2023, SA published the terms under which South Africa will participate in the new free trade agreement. To date, a total of Twelve countries, including South Africa, have finalised their legal modalities to enable trade on thousands of products lines, ranging from food and beverages to steel products and equipment, taxis, pharmaceutical and personal care products, chemical products and household goods such as fridges and televisions.

South Africa’s GDP is estimated at $419 billion and its well-established industries and experience in exports can provide a blueprint for developing and less developed countries on the continent. However, the implementation of the AfCFTA is progressing slowly despite all the incentives to accelerate its implementation. All members of the Gilded Trade Initiative – a South-South Project have ratified the AfCFTA. Some countries have started exporting and importing under the AfCFTA. Similarly, Kenya is importing its first consignment of machinery, agricultural products, and electronics, among them refrigerators, from South Africa under the African Continental Free Trade Area (AfCFTA). It will export tea, coffee, and fruits under the same initiative in the coming weeks. Meanwhile, Cameroon cleared a shipment of €90,000 (around TND 204,000), worth of resins, which was carried out by the Port Autonome de Kribi (PAK). 

The Protocol will Speed up Economic Development across Africa 

The Protocol could boost intra-Africa trade in goods and services and investment, deepen the economic integration of Africa, transform societies and economies, generate sustainable and inclusive economic growth, stimulate job creation and reduce inequality.

It will equally eliminate barriers to digital trade, establish clear and predictable harmonised rules, common principles and standards for digital trade while creating a secure and trustworthy environment for interoperable frameworks and systems to accelerate digital trade.

Recommendations for the Protocol on Digital Trade

• The Protocol should encourage data transfer between state parties in services trade, especially digitally-intensive sectors such as telecommunications, computers and informations services. 
• The Protocol should mandate domestic regimes that encourage and facilitate digital transactions and documents including the legal validity of electronic contracts and documents. This will reduce the  time and cost of trading across borders, especially for micro, small and medium enterprises.
• The protocol should reinforce the obligation not to impose customs duties on electronic transmissions and products as well as not to accord less favorable terms to digital products from other African countries.

Conclusion

The 12th Meeting of Ministers Council is an important step in ensuring and promoting digital trade under the AfCFTA. The Protocol has the potential to increase trade by fostering mutual recognition,  interoperability of electronic trade documents, electronic authentication, electronic signatures, digital payments, digital certificates, digital identities, cross-border data transfers and digital infrastructure. An affordable, accessible and reliable digital infrastructure is indispensable in accelerating the implementation of the AfCFTA.

This article was completed by the CEPI Trade Team under the “Trade for You” Project.