Accra, 17 May 2022 (TDI): Accra, the capital of Ghana is witnessing the commencement of the 7th AfCFTA meeting of the subcommittee on Rules of Origin. The meeting commenced on May 16, 2022.
The meeting aims to discuss how to improve and fulfill the implementation process of the Rules of Origin. Also, the meeting offers a platform for representatives to share experiences on the domestication of the AfCFTA Rules of Origin.
An Introduction to AfCFTA’s Rules of Origin
The United Nations Conference on Trade and Development (UNCTAD) once hailed Rules of Origin as a key part of the success of AfCFTA. Initially, the Rules of Origin under the umbrella of AfCFTA will increase trade within the African continent.
With such growth, African countries can attract more investment from continental stakeholders, create market opportunities, offer more employment, and finally promote industrialization in Africa through regional value chains.
At the beginning of AfCFTA’s implementation, the lack of an agreement on the Rules of Origin limited the mechanism. However, a great breakthrough came out earlier this year.
On January 28, 2022, the 8th Meeting of the AfCFTA Council of Ministers Responsible for Trade witnessed a huge success. After carefully negotiating, the member states of AfCFTA finally had 87.7% of the Rules of Origin agreed upon.
To be specific, the agreed contents of the Rules of Origin contain 3,800 tariff lines. Moreover, AfCFTA representatives also agreed to allow the trading of a further 850 products under the new Rules of Origin.
Why Are Rules of Origins Crucial to AfCFTA?
According to the data, AfCFTA is expected to increase trade within the African continent by 33% once full tariff liberalization is implemented.
Simultaneously, the implementation of the Rules of Origins will offer African countries a better way to promote regional development, which will finally benefit every country on the continent.
Besides, compared with other regions around the world, Africa’s inter-regional trade still has a lot of room for development. UNCTAD’s data shows that until 2017, trade within Africa was only 15%.
At the same time, the percentage was around 47% in America, 61% in Asia, and 67% in Europe. Therefore, with simple, transparent, and business-friendly rules, Africa does have unbelievable potential to achieve self-development in a sustainable way.
