MPs urged to domesticate AfCFTA

The East African Legislative Assembly (EALA ) 3rd Meeting- 2nd Session Chaired by Joseph Ntakirutimana at Mini Chambers, County Hall, Parliament, Nairobi on March 7, 2024. [Elvis Ogina, Standard]

Members of Parliament have a vital role in the domestication process of the African Continental Free Trade Area (AfCTA) by ensuring the enactment of necessary legal frameworks for effective implementation.

AfCTA Secretary General Wamkele Mene told a joint sitting of the Committees of Trade for the Senate and National Assembly that there is need to pass laws that incorporate the AfCFTA into national legislation.

Mene who addressed the two committees at the Senate Chambers in Nairobi yesterday asked parliamentarians to allocate resources for infrastructure development that facilitates trade such as improving road networks, ports, and customs facilities.

“Improved infrastructure is critical for reducing the cost of doing business and enhancing competitiveness, it is imperative to promote policies that ensure inclusive benefits from the AfCFTA across all segments of society, including women, the youth, and the informal sector,” said Mene.

He urged parliamentarians to leverage Kenya's position within the East African Community (EAC) and other regional bodies to harmonise AfCFTA approaches, share best practices, and, where feasible, negotiate as a bloc.

The secretary general called on Parliament to oversight implementation of the AfCFTA and its impact on the Kenyan economy, including how local businesses exploit new market opportunities and challenges they face.

Mene acknowledged the role the Kenyan Parliament has played in advancing and realising the AfCFTA citing ratification of the agreement, engagement in key initiatives and enactment of legislation that supports African integration.

“Let me stress the importance of enacting national legislation that reflects Kenya's interests while also aligning with our shared goals for continental prosperity, this includes making appropriate budget allocation for the implementation of national strategies related to the AfCFTA,” he said.

Senate Majority Leader Aaron Cheruiyot said that since independence, Kenya has made strides in the trade sector nationally and internationally.

He noted that Vision 2030 recognises the trade sector as key in achieving the envisaged 10 per cent economic growth due to its immense contribution to GDP and employment creation.

Cheruiyot said that the Sustainable Development Goals emphasise implementing and revitalising global partnerships for sustainable development through trade liberalisation and globalisation.

He noted that AfCFTA objectives are progressive while reducing tariffs among member states, trade facilitation as well as harmonisation of regulatory measures such as sanitary standards will enhance continental trade.

“The Constitution of Kenya, legislative and policies frameworks, related to trade have created an enabling environment for trade and investment by both national and international players, to further foster trade, the Senate has considered a number of legislation that focus on trade development with focus on the counties,” said Cheruiyot.

Senate Trade Committee Chairman Lenku Seki said that Kenya has remained steadfast in its support of AfCFTA and is an active player in African economic integration initiatives. Kenya was among the first nations to ratify and deposit the instruments of ratification of AfCFTA.

Seki noted that Africa is home to more than 1.2 billion people with a GDP of close to three trillion US Dollars, however, the continent has not taken advantage of this huge potential due to economic fragmentation and challenges in implementing economic integration.

“This is fortunately now set to change with the implementation of the African Continental Free Trade Area, Indeed, regional integration has and will continue to be an important strategic instrument for expanding economic opportunities of countries across the world,” he said.

AfCFTA was established in 2018 as one of the flagship projects of the African Union Agenda 2063. The Agreement establishing the AfCFTA was signed in Kigali, Rwanda, in October 2018 by 44 heads of state and governments of the AU member states.

Its main mandate is to create a single continental market of 55 member states of the African Union which has a population of over 1.3 billion people. It is envisaged that it will create a trading bloc with a combined GDP of more than $3.4 trillion.

Once in place, intra-African trade is expected to grow by 33 per cent, and Africa’s total trade deficit is expected to be cut in half. In addition, the AfCFTA could generate combined consumer and business spending of $6.7 trillion by 2030, according to the Mo Ibrahim Foundation.

According to the World Bank Group the gains from AfCFTA will come from decreased tariffs, reduced trade costs as a result of decreasing non-tariff barriers and improving hard and soft infrastructure at the borders also known as facilitation measures.

Trade under the AfCFTA agreement came into force on May 30, 2019, days after 22 countries deposited their instruments of ratification. on January 1, 2021, Africa officially started trading under the AfCFTA agreement.

The agreement covers trade in goods, services, investment and intellectual property rights and competition policy. Benefits of implementation of the agreement include increase in intra African trade, country specialisation in sectors with comparative advantage, economies of scale, structural transformation and the creation of employment opportunities.

The World Bank projects that implementation of the agreement will reduce tariffs among member countries and address policy gaps such as in trade facilitation and services, as well as regulatory measures such as sanitary standards and other technical barriers to trade.