Assessing Five Years of the African Continental Free Trade Area (AfCFTA): Proposals on Potential Amendments
By Kiiza Africa
On 30th May 2024, the African Continental Free Trade Area (AfCFTA) celebrated its fifth anniversary, which legally implied that the agreement is up for review for possible amendments. To kickstart this review, the Thirty-Seventh Ordinary Session of the African Union Summit (held in February 2024) directed the AfCFTA Secretariat to take necessary measures for the start of the review of the Agreement. This review comes at a moment when the AfCFTA implementation and its vehicle, the Guided Trade Initiative (GTI), have been fraught with challenges. Broadly, these challenges include the slow submission of tariff liberalization schedules by State Parties, infrastructure deficits, persistent non-tariff barriers and trade wars in regional economic communities, and overlapping regional trade commitments. Thus, the upcoming AfCFTA review provides an opportunity to assess progress, identify implementation bottlenecks, and propose actionable amendments. This paper examines these challenges through a comprehensive analysis of the AfCFTA’s state of play, illuminating the progress while highlighting the slow momentum registered for the past five years of its operation. Proposals for the agreement’s amendment revolve on accelerating infrastructure development, harmonizing rules of origin, integrating labor rights, and fostering industrial diversification. By moving beyond liberalization as its raison d’être and prioritizing the scaling up of State Parties’ productive capacities, the AfCFTA can evolve from a mere trade liberalization agreement into a transformative driver of Africa’s economic renaissance. It is hoped that this timely assessment underscores the urgency of reorienting the AfCFTA to unlock its full potential for propelling intra-Africa trade.
African researchers continue to face information-access barriers owing to copyright exclusivity preserved by the global copyright system that is designed and skewed towards protecting rights holders’ interests. A specific explicit human right to research is an important mechanism that can ensure an equitable balance between the private commercial interest of copyright owners and the public interest in promoting access to information for research in Africa. This article demonstrates how the right to research can be constructed from the normative content and scope of the rights to science and culture, education, property and freedom of expression provided for in international, regional and national human rights regimes in Africa.
ReAct Africa and South Centre will co-host the 2024 regional AMR annual conference from 9th – 11th July in Livingstone, Zambia, under the theme “Global Accountability for AMR response: Investing in priorities for Africa”.
Unveiling the Controversies: ICTs in Agriculture and the Challenges for Africa
By Ruthbetha Kateule and Thaura Ghneim-Herrera
The integration of Information and Communication Technologies (ICTs) in African agriculture presents both significant opportunities and challenges. While ICTs can enhance efficiency and productivity, addressing the digital divide and structural inequalities is crucial for their effective implementation. It is imperative to incorporate local knowledge and address region-specific challenges to ensure that these technologies are accessible and beneficial to all, particularly in rural and underserved areas. Moving forward, a balanced approach that focuses on sustainable development, equitable access, and environmental stewardship will be key to realizing the full potential of smart agriculture in Africa and the Global South.
This paper presents a summary of a research conducted with the support of the Montpellier Advanced Knowledge Institute on Transitions (MAK’IT) of the University of Montpellier, within the framework of the 2024 COHORT programme, and the cooperation of the South Centre.
The Protection of Traditional Knowledge, Traditional Cultural Expressions, Expressions of Folklore and Genetic Resources Within the African Continental Free Trade Area – Alignment with International and Regional Developments
By Caroline B. Ncube
The adoption of the Protocol on Intellectual Property Rights under the Agreement on the African Continental Free Trade Area presents an opportune moment to consider a continental framework for the protection of Traditional Knowledge, Traditional Cultural Expressions, Expressions of Folklore and Genetic Resources. This SouthViews considers lessons which can be drawn from national laws, using South Africa as an example, for the relevant Annex to be negotiated under the protocol.
Implementing the Doha Declaration in OAPI Legislation: Do Transition Periods Matter?
By Patrick Juvet Lowé Gnintedem
The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement) provided for a number of transition periods allowing countries to engage in a phased implementation of their TRIPS obligations. More specifically, transition periods targeted the patenting of pharmaceutical products. The original deadlines for transition periods have expired for developed and developing country WTO members. However, based on the Doha Declaration on the TRIPS Agreement and Public Health and subsequent TRIPS Council decisions, least developed countries (LDCs) continue to benefit from extended transition periods. In the African Intellectual Property Organization (OAPI), after an amendment in 1999, the legal framework has evolved with the amendment of the Bangui Agreement, i.e., the Act of Bamako of 14 December 2015. As for the previous text, the newly amended Bangui Agreement consecrates the unification on industrial property amongst its seventeen Member States. The main objective of such an amendment remains to adapt its legal framework to the international environment and to the economic and social development needs of Member States. Yet only five OAPI Member States are developing countries; the twelve others are LDCs. Then the question arises: do transition periods consecrated pursuant to the Doha Declaration still matter for LDCs who have agreed to be subjected to the OAPI legislation? This paper points out that transition periods remain relevant in OAPI countries by application of the more favorable rule between the Bangui Agreement and the WTO TRIPS Council decisions. It is however noted that the OAPI current legal framework is still problematic, while its LDCs members are underutilizing this flexibility.
COVID-19, Future Pandemics and the Africa Care Economy Index
By Salimah Valiani
In Africa, the care economy has long been unrecognised. At least since the last major pandemic in Africa, HIV-AIDS, caring work has been severely undervalued in the continent, and the redistribution of caring work, from females in the home and communities, is next to nonexistent. Undoing this structural inequality is crucial to improve health and wellbeing of girls and women in Africa, to be prepared for future pandemics, and to realise Africa’s demographic dividend for the benefit of the majority. To achieve this, the Africa Care Economy Index is offered as a policy, advocacy, and accountability tool.
The global landscape of climate finance is highly fragmented and complex, involving multiple pathways, actors, institutions, and instruments. Funds provided by developed countries to developing countries for climate adaptation and mitigation actions are channelled through various multilateral funds – both within and outside the scope of the operating entities of the UNFCCC’s financial mechanism.
Developing countries indisputably need climate finance to flow at a sufficient scale and in a timely manner. While the options and possibilities for countries to access climate finance are expected to increase, with a multitude of funding channels, this can also make the process even more complicated and confusing. Which funds to turn to? For which activities? At what costs? These are a few of the many questions that climate change decision-makers must contend with. Each fund is administered with complicated rules and procedures, which makes it very challenging for developing countries to navigate when seeking to fund their domestic climate actions. There is currently no ‘one-stop-shop’ to provide useful and quick answers.
The Climate Finance Readiness E-book is a series of short briefs prepared by the South Centre to provide developing countries with a «help desk» to access and more effectively and efficiently utilise the complex web of climate finance information available to them. This brief will be updated periodically and will shine a spotlight on different geographical areas. The South Centre welcomes questions, comments, and suggestions for this series of briefs to continuously improve its help desk function on Climate finance.
Implementing wealth tax and wealth redistribution in Sub-Saharan Africa
By Khanyisa Mbalati
Sub-Saharan Africa is one of the most unequal places in the world, with significant levels of social, gender, and income inequality. Several countries in the region have a tax structure that is heavily weighted towards consumption taxes, which can be regressive and inflict a significant burden on those with low and middle incomes. Implementing progressive tax systems, whereby those with higher earnings pay a larger share in taxes, is one way through which governments might optimize the impact of tax revenue on reducing inequality. The adoption of a wealth tax may facilitate wealth redistribution in Sub-Saharan African nations and could help bridge the inequality gap in the region. High statutory wealth tax rates of between 5-8% are needed in order to have an effective tax rate of 3-5%.
Taxation of Digital Services: what hope for the African States?
By ADJEYI Kodzo Senyo, KOUEVI Tsotso and AMAGLO Kokou Essegbe
Globalization makes it necessary to adapt multinational taxation by taking into account the place of use or consumption of goods and services. “Pillar 1” of the OECD aims to allow States in which multinationals market products or services, or collect data and content from users, to benefit from a portion of their residual consolidated worldwide profit. Since residual profit is a function of the turnover and profit achieved in the jurisdiction, this solution can only be an advantage if, beyond the rules of fair taxation, efforts are made to promote the use of digital services. Internet access is one of the levers that can increase the consumption of digital services. The current situation in Africa according to statistics published by the International Telecommunication Union (ITU) shows low rates of internet access compared to other continents.
Global Minimum Taxation of Multinationals: Opportunities and risks for some African States
By AMAGLO Kokou Essegbe, KOUEVI Tsotso and ADJEYI Kodzo Senyo
To face the challenges posed by the digitization of the economy, the OECD’s Inclusive Framework has developed two Pillars to address tax base erosion and profit shifting. The objective of Pillar Two is to define the minimum amount of tax to be paid by multinational enterprises in the jurisdictions where they operate. The OECD’s Inclusive Framework has adopted an average effective rate of 15% for this purpose. The objective of this study is to show whether the implementation of Pillar Two in African jurisdictions constitutes an opportunity or a risk for them.
The results show that it is an opportunity for countries with a low effective tax rate and a risk for countries with a high effective tax rate. Therefore, setting a 15% income tax rate for non-resident multinationals is an opportunity for some African countries. For it would constitute for these countries a source of additional tax revenue mobilization. For this reform to be an opportunity for Africa, however, the minimum effective tax rate must be raised to at least 20%, as was demanded by the African Tax Administration Forum (ATAF).
The risk that lies in the application of an effective rate of 15% for Africa as a whole is that some African countries might have to reduce their effective tax rate. This would be a loss of revenue for those African countries. Since most countries in the African jurisdiction have effective tax rates and statutory corporate income tax rates that are more than 20 percent, above the set average effective rate, multinationals would seek to shift their profits to the countries with the most advantageous taxation. This could lead to a transfer of profits to other jurisdictions.