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Download Report Signed by 54 African countries, the African Continental Free Trade Area (AfCFTA) is, by the number of participating countries, the largest trade agreement since the formation of the WTO. By 1 April 2019, only one year and ten days after the signature, the threshold of ratification by 22 countries required for the NEXT STEPS FOR agreement’s entry into force had been reached. The speed of this ratification is unprecedented in African Union history. With so much achieved in so impressive an amount of time, it is time to think ahead to where the momentum of the AfCFTA can be taken. That is the inspiration for this ninth edition of the flagship Assessing Regional Integration in Africa report (ARIA IX), which asks: “What’s next for the AfCFTA?”. In answering, the report recognizes that it is not enough for the AfCFTA to be THE AFRICAN merely negotiated, concluded and ratified. It must also change lives, reduce poverty and contribute to economic development. For this, the AfCFTA must be effectively operationalized, but also supported with complementary measures that leverage it as a vehicle for economic development. Among the most important of the next steps is the phase II negotiations scheduled to commence on intellectual property rights, investment and competition policy FREE CONTINENTAL in late 2019. These policy areas are the core focus of this report, which takes stock of the current situation across the continent in each of these areas and identifies recommendations for substantive provisions in the AfCFTA. In looking ahead, the report also considers e-commerce and integration in a digitizing Africa, and how the digital economy can interact with the AfCFTA and trade in Africa. TRADE AREA NEXT STEPS FOR THE AFRICAN CONTINENTAL FREE TRADE AREA ASSESSING REGIONAL INTEGRATION IN AFRICA | ARIA IX ASSESSING REGIONAL INTEGRATION IN AFRICA | ARIA IX NEXT STEPS FOR THE AFRICAN CONTINENTAL FREE TRADE AREA Ordering information To order copies of this report, please contact: Publications Section Economic Commission for Africa Menelik II Avenue P.O. Box 3001 Addis Ababa, Ethiopia Tel: +251 11 544-9900 Fax: +251 11 551-4416 E-mail: [email protected] Web: www.uneca.org © 2019 United Nations Economic Commission for Africa, African Union, African Development Bank and United Nations Conference on Trade and Development Addis Ababa, Ethiopia All rights reserved First printing: July 2019 Second printing: September 2019 Title: Assessing Regional Integration in Africa IX Language: English ISBN: 978-92-1-125137-1 eISBN: 978-92-1-004299-4 Sales No. : E.19.II.K.3 Print ISSN: 2411-8192 eISSN: 2411-8206 Cover design and layout: Karen Knols, Ginnette Ng, Carolina Rodriguez and Tessa Schlechtriem. Material in this publication may be freely quoted or reprinted. Acknowledgement is requested, together with a copy of the publication. The designations used and the presentation of material in this publication do not imply the expression of any opinion whatsoever on the part of the ECA, AfDB, AU or UNCTAD concerning the legal status of any country, territory, city or area, or of its authorities, or concerning the delimitation of its frontiers or boundaries, or its economic system or degree of development. Designations such as “developed”, “industrialized” and “developing” are intended for statistical convenience and do not necessarily express a judgment about the stage reached by a particular country or area in the development process. Printed in Addis Ababa by the ECA Printing and Publishing Unit. ISO 14001:2004 certified. Printed on chlorine free paper. iv Contents Key Messages and Policy Recommendations .........................................ix Chapter 1 The Status of Regional Integration in Africa ..................................ix Chapter 2 The State of Play and Next Steps for the African Continental Free Trade Agreement ..........................................................................x Chapter 3 Taking Full Advantage of the AfCFTA .........................................xi Chapter 4 Intellectual Property Rights Protocol ........................................xii Chapter 5. Competition Policy Protocol ................................................xiii Chapter 6 Investment Protocol. xiv Chapter 7 E-Commerce and Integration in a Digitizing Africa ..........................xv Acknowledgements. .xvii Foreword ..............................................................................xix Chapter 1: The Status of Regional Integration in Africa ............................1 Macroeconomic convergence and monetary and financial integration .................2 Macroeconomic convergence in RECs ...................................................3 Trade and investment integration ......................................................5 Migration and free movement of persons ..............................................16 Infrastructure integration ..............................................................18 Health integration .....................................................................27 Mining sector integration ..............................................................27 Governance, peace and security .......................................................28 Key messages and policy recommendations. 31 References .............................................................................32 Endnotes ...............................................................................34 Chapter 2: Status and Next Steps for the AfCFTA ..................................37 Status of the AfCFTA negotiations ......................................................37 What is in the agreement? .............................................................43 The AfCFTA and RECs: Ensuring internal trade policy coherence .......................48 The AfCFTA and external trade policy coherence .......................................56 Next steps for the AfCFTA ..............................................................61 Key messages and policy recommendations. 64 References .............................................................................66 Endnotes ...............................................................................68 Chapter 3: Taking full advantage of the AfCFTA. 71 Complementary measures to take advantage of the AfCFTA ...........................71 Investment measures ..................................................................71 v A productive capacity development agenda ..........................................74 Trade facilitation measures .............................................................79 Trade-related infrastructure measures .................................................85 Import defence measures ..............................................................86 National AfCFTA strategies: A coherent approach to complementary measures .......89 Key message and policy recommendations ............................................90 Appendix 3A Methodology for gender mainstreaming in AfCFTA national strategies .............92 Introduction ...........................................................................92 Appendix 3B Components of AfCFTA national strategies .........................................94 Macroeconomic framework, production systems and trade patterns review ..........94 References .............................................................................99 Endnotes ..............................................................................101 Chapter 4: Intellectual property rights protocol ..................................103 Background to intellectual property rights ...........................................103 Intellectual property policy and regulatory frameworks: regional experiences in Africa ............................................................................107 Intellectual property policy and regulatory frameworks: national experiences ........112 Towards an intellectual property rights protocol for the African Continental Free Trade Area ....................................................................123 Key messages and policy recommendations. .130 References ............................................................................132 Endnotes ..............................................................................137 Chapter 5: Competition Policy Protocol ...........................................141 Why a competition protocol in the AfCFTA?. 141 A closer look at competition regimes in Africa ........................................147 Consumer protection in the AfCFTA. 152 Emerging competition issues and challenges for the AfCFTA. .152 Towards an AfCFTA competition policy protocol . .160 Enforcement . .164 Key messages and policy recommendations. .168 References ............................................................................169 Endnotes ..............................................................................171 Chapter 6: Investment .............................................................173 Setting the scene .....................................................................173 The investment landscape in Africa ...................................................174 A critical assessment of the investment treaty regime ................................178 Towards an AfCFTA investment protocol .............................................187 Relationship with other phase I and II areas ..........................................202 vi Negotiation and implementation .....................................................208
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