Hibist Kassa (Ethiopia) is a member of DAWN’s Executive Committee and PEG team. She is currently a PhD scholar at the University of Johanesbourg.
In the aftermath of the 2008 financial crisis, and persistent multiple and interlinked crises deepening poverty and devastating livelihoods, we are witnessing a seismic shift in global politics. A multipolar world with all its uncertainties is taking shape.
Former African Union (AU) Chairperson, Nkosazana Dlamini-Zuma, in her last speech to the Executive Council of Ministers of the African Union (AU) in January, pointed to the threat that Trump poses to gender and climate justice, and the shift to increased protectionism. For Dlamini-Zuma, Africa’s response is the Continental Free Trade Agreement (CFTA).
The CFTA is meant to be an instrument for transformation and integration. According to UNCTAD, from 2007 to 2011 intra African exports, were only 11% while in other regions such as Asia and Latin America and Caribbean, were 60% and 21% respectively. This illustrates a particular degree of internal disarticulation and regional fragmentation. Thirty years of neoliberal reforms have actually worked to deepen these patterns, with declining manufacturing, stagnant agriculture and intensification of extractivism.
The CFTA is an attempt to fast track an earlier process initiated in 1991, known as the Abuja Treaty. This outlined a process for successive sectoral cooperation and the creation of free trade areas, continental customs union among others. The Abuja Treaty was only pursued in a limited way and remained largely stagnant. The CFTA will take forward the free trade component. In principle, there is no doubt that integration should be pursued as a matter of urgency. But how we do this is also critical.
The CFTA, as currently framed, has taken a narrow focus on aggressive elimination of tariffs and deregulation of services while ignoring differences between countries and social groups on the continent. It is not linked to key sectors especially, agriculture and manufacturing, in a coherent manner. It assumes that aggregation of markets will overcome limitations that are more structural in nature. The problems of production and infrastructure facing African producers are not prioritised.
Without public policy that carefully works through linkages between tariff and trade related issues and agricultural and industrial policy, continental integration may actually be reduced to merely facilitating imports and therefore undermining African producers. In fact, it also has implications for commitments already made under agreements such as the Economic Partnership Agreements (EPAs) by creating a bigger market for European goods and investments. With the rise of emerging markets, it is not only the ‘traditional partners’ who pose a risk to African producers in this regard.
These limitations have long fed demands for structural economic transformation to rebuild domestic economies by focusing on manufacturing, value addition on export commodities, increased investment in agriculture, strengthening the productive base and linkages between sectors. This is to lay a basis for creating decent jobs, improving wages, incomes and strengthening livelihoods.
As currently outlined, the CFTA aims to create a continental open market for goods and services, free movement of business persons and investments and a continental customs union. It also seeks to expand intra-African Trade through harmonisation of trade liberalisation and facilitation regimes. Additionally, it seeks to enhance competitiveness at industry and enterprise level through exploiting scale production and continental market access and better allocation of resources.
In effect, in a short span of time, it will create an open market across economies of varied levels of development, ignoring unevenness and differential impact on social groups. This raises other concerns, for instance, under CFTA, tariffs on food products are intended to be completely eliminated. It may seem like a less threatening prospect to bring together economies which appear to be on a more level playing field than, for example, EU and Togo. However, according to Regions Refocus and Third World Network Africa, ‘tariff liberalization alone could aggravate the economic imbalances among African countries and result in certain countries suffering from fiscal revenue loss and the destruction of local industries’.
When one considers the unevenness between agriculture in South Africa, dominated by commercial plantations which according to Henry Bernstein have become even more concentrated post-apartheid, and families farming less than an acre (majority of whom are women) elsewhere in Africa, the threat is obvious. Without conscious and purposive intervention from public policy, small producers and traders, will be overcome by competition. This is especially so with the threat posed by climate change in a region in which agriculture is dependent on natural cycles. Considering there is a context of stagnation in agriculture, and marginalisation of economic and social needs of rural populations, any threats to further undermine productive capacity should be alarming.
The pursuit of gender equity and equality ought to be prioritised. Policy ought to be geared to overcoming segmentation in low value, precarious and subsistence work, unequal access to productive resources and training and skill building in education and labour markets. It is particularly important to also understand how inequities and inequalities are deepened by the heavy burden of care and domestic work borne exclusively by women. However, these concerns seem to be ignored.
Regardless, AU and the Economic Commission for Africa (ECA) have been forging ahead to fast track the process, begin negotiations and implement CFTA in 2017. This is even in spite of member states questioning its feasibility.
The first meeting of the technical working groups (TWGs) from 6-17 February was focused on ‘fast-tracking the establishment of the CFTA’. According to Mr. Nadir Merah, Head of Trade Division of the African Commission, there is a need to harmonise customs laws and procedures to boost intra African Trade. A model text has been developed by the AUC on trade on goods and services.
To be presented with the possibility of opening up borders created under colonisation which divided the African people and the land is in principle in the right direction. Undoing a colonial legacy of orienting domestic economies to export unprocessed primary commodities, import manufactured products, weak linkages between sectors, and wider context of poverty and the devastation of livelihoods, ought to be priority.
However, the manner this is being approached actually threatens to deepen poverty and destroy livelihoods, while also creating even more unstable conditions for African economies. AU and ECA are bulldozing the CFTA, regardless of the consequences. According to Fatima Acyl, the Commissioner for Trade and Industry $20 million for initial plans. The process itself has been largely opaque. Women, farmers, workers, the youth and civil society who will be directly affected by this process are being ignored. A democratic and transparent process for the negotiations are urgently needed. In the absence of this, African people’s perspectives, experiences and interests in all our diversity are being marginalised. Africans must unite, but only on our own terms. ~
“Phambili” means ‘forward’ in Nguni which is spoken in Southern Africa. In the liberation struggles, and to date, Phambili remains a word often used in slogans, protests and marches.