The adoption of the Tripartite Free Trade Area (TFTA) Agreement on 10 June 2015 was a landmark event. It will find its place in the annals of African history along with momentous events such as the independence of Ghana in 1957, the creation of the Organization of African Unity in 1963, and the freeing of Nelson Mandela in 1994. The agreement promises to do for the continent’s economic freedom what those three events did for Africa’s decolonization and political freedom. The impact of the agreement cannot be assessed in isolation of Africa’s quest for a greater role on the global trading scene.
The high number of independent African countries gave the continent disproportionate strength in diplomatic negotiations. But the sovereign autonomy of African states denied the continent the economic clout that was needed to match its numerical capabilities and geographical vastness. It is only through greater economic strength that the continent can hope to realize its full potential as a notable international actor.
The aim of this project is to trace the remarkable journey of institutional innovation that has resulted in the creation of a free trade area covering 26 nations, including 620 million people starting off with a GDP of $1.3 trillion. This diplomatic feat was achieved through a process of experimentation and learning that was initially guided by a common vision reflecting the will of African leaders to consolidate their efforts and reap the benefits of larger economies.
African leaders initially envisioned the creation of a unified continent. But this was not possible until all of Africa was free from colonial rule. This rule left behind a legacy of national economies that largely supplied the industrialized world with raw materials. Efforts to obtain better trading terms through international trade negotiations paid little dividends. The pressure to respond to the needs of a growing population created the imperative to look to regional markets. But these same markets were limited by poor infrastructure, trade barriers and long-standing competition driven by uncertainties in the global trading systems.
The route of political integration as a prerequisite for economic cooperation did not seem feasible despite a few isolated efforts. Regional integration itself dates back to the colonial days. In addition to dozens of independent national economies, Africa was also encumbered by a large number of overlapping regional bodies that served a diversity of functions ranging from security to desertification control. But the motivating force among these functions was regional trade.
This project underscores the primacy of trade as the currency of regional economic integration. It is the motherboard upon which many other regional activities will be processed. Economic freedom is emerging as the dynamo that will drive other areas of continental integration. Trade, however, is viewed in a broad sense as development. The developmental approach to integration in Africa has at least three main pillars: market integration, and industrial and infrastructure development. While market integration creates large markets to support economies of scale and critical levels of investment, it is industrialisation that creates the products to be traded and the much needed jobs. Infrastructure is required to provide the nuts and bolts that actually knit together the regional markets, for without interconnectivity through surface and air transportation and information and communication technologies, there would be no market to talk of. Infrastructure covers critical components of promoting competitiveness for industrialisation, particularly ubiquitous and affordable energy, and rural infrastructure for agricultural development covering water and damming, fertilizers, seeds, and extension services. In this regard then, the continental and regional programs for industrial, infrastructure and agricultural development, namely, the Accelerated Industrial Development of Africa Programme (AIDA), the Programme for Infrastructure Development in Africa (PIDA), and the Comprehensive Africa Agriculture Development Programme (CAADP), will be essential components of economic integration in Africa, operating as an integral whole with market integration programmes to create the Tripartite and Continental free trade areas.
This African approach vastly differs from pure free trade agreements that cover only market integration, sometimes exclusively the elimination of customs duties on trade in goods among the participating countries, and other times extending to other border measures relating to customs procedures and standards, as well as behind-the-border regulatory issues. Modern free trade areas cover services and investment issues as well, because services facilitate trade in goods and constitute anything up to 50 percent on average of the gross national outputs of most African economies. The importance of investment in assisting economic development cannot be overemphasized. The approach in Africa, however, is still much broader than any free trade areas that are not complemented by comprehensive infrastructure, industrialisation and agricultural development programmes. Trade in Africa is developmental, and the Tripartite Free Area will be part and parcel of the industrial, infrastructure and agricultural development programmes of Africa as implemented in the regional economic communities including the Common Market for Eastern and Southern Africa (COMESA), the East African Community (EAC) and the Southern African Development Community (SADC) that make up the Tripartite initiative. This developmental approach to regional integration has been codified in the agreed template for continental integration formulated under the Organisation of African Unity and continued under its successor organisation, the African Union.
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