Kenya to begin exporting its goods duty-free outside of the East African Community (EAC) bloc after a deal was reached on tariff lines that will exclude up to 88 per cent of products from the continental trade body.
Last week members of the African Continental Free Trade Area (AfCFTA) ended the negotiating rules of origin on a positive note. thereby lowering tariffs on products travelling inside the continent.
The conclusion of discussions on rules of origin, according to AfCFTA Secretary-General Wamkele Mene, is a crucial step toward the smooth implementation of the free trade agreement.
“Now that we’ve agreed on 87.7% of the rules of origin, member states can publish these legal instruments at the national level so that nations can implement these rules of origin from a customs standpoint,” Mr Mene added.
Trading under the AfCFTA was supposed to begin on January 1, 2021, but it was postponed due to unresolved issues with rules of origin, making it impossible to identify which items should be placed on the agreement’s preferential tariff.
Each trade bloc has its own common external tariff (CET), which it levies on commodities imported beyond its borders.
For ease of trading, the EAC imposes a levy of up to 50% on items imported from other regions, just as members of the Economic Community for West Africa (Ecowas)
The established rules of origin will constitute the basis for full-scale trade among the various member nations under the free trade agreement to improve Africa’s economic growth, according to Ebrahim Patel, chairperson of the African Union (AU) Ministers of Trade.
“For ordinary citizens on our continent, this means more jobs, more economic opportunities, and Africa’s opportunity to say we want to industrialize. We cannot simply remain the generators of raw materials,” said Mr Patel.
The journey towards Africa Continental Free Trade Area gained momentum in March 2018 when 44 nations signed up during the African Union Extra-Ordinary Session in Kigali, Rwanda.
After the National Assembly revised the trade agreement, Kenya became the first country in eastern Africa to ratify it.
The treaty will allow products and services to flow freely from one country to the next across the continent.
