What is AfCFTA? And what does Ghana’s hosting of the AfCFTA Secretariat mean for the Country, Legally Speaking?
At its 12thExtraordinary Summit held from 6 to 7 July 2019 in the Nigerien capital Niamey, the African Union chose Ghana to host the Secretariat of the African Continental Free Trade Area (“AfCFTA Secretariat”). The AfCFTA Secretariat is the institution charged with providing administrative support for the implementation of the AfCFTA Agreement.
The selection of Ghana as the administrative seat of the Continental Free Trade Area marks the first time Ghana is hosting any of the organs of the Pan-African Organization despite the historic and significant role that Ghana’s first President, Dr Kwame Nkrumah, played in the formation of the Organization of African Unity (OAU), the predecessor of the African Union (AU).
In this essay, I discuss what it means for Ghana to be the seat of the African Continental Free Trade Area as it hosts the Secretariat. The discussion will cover (a) the legal processes that must be finalized between Ghana and the African Union to give effect to the decision to host the Secretariat in Ghana; (b) the nature and extent of the legal relationship that will exist between Ghana and the Secretariat relative to its staff, properties and operations; and (c) opportunities that the hosting of the Secretariat presents for the Ghanaian legal community.
But to put the discussion in proper context, I will first give a brief overview of the origins of AfCFTA within the broader scheme of the African Union’s integration agenda, followed by an analysis of the nature of AfCFTA and the mandate of the AfCFTA Secretariat.
II. The Long Road to the African Continental Free Trade Area (AfCFTA)
The African integration agenda that has birthed AfCFTA is inspired by the concept of Pan-Africanism. First advocated by leading diasporan African scholars like Sylvester Williams, W.E.B Dubois and Marcus Garvey, Pan-Africanism is the “political and cultural [ideology] that considers Africans, wherever they are, as a united whole and fosters solidarity amongst peoples of African origin.”
The concept became the rallying point or platform for the “Pan-African Movement” which during the first half of the 20th Century (a) asserted the self-worth, dignity and equality of Africans with all other races; and (b) demanded an end to the European colonial project in Africa, thereby spurring on the struggle for African independence.
By the dawn of African independence, Pan-Africanism had entered a new phase that was driven by the matchless intellectual and political leadership of Dr. Kwame Nkrumah. For him, the endgame of the Pan-African Movement was not just to demand and obtain independence from European colonial rule, but also what could be achieved with the regained freedom. He wanted Pan-Africanism translated from a mere ideal of solidarity into something concrete and real: A Union of African States under a continental government that will secure for all Africans the benefits of a common economic and financial system, a common defense and security system, a common foreign policy and a common African citizenship. That was how Africans could reclaim their dignity and place in the world and become a force to be reckoned with.
Consequently, at the 1963 Summit of African Heads of State in Addis Ababa to discuss the nature and form Africa’s unity should take, he strongly urged:
- the framing of “a constitution for a Union Government of African States”;
- the drawing up of “a continent-wide plan for a unified or common economic and industrial programme for Africa” that should “include proposals for setting up: (a) a common market for Africa; (b) an African currency; (c) an African monetary zone; (d) an African central bank; [and] (e) a continental communication system”;
- the drawing up of “details for a common foreign policy and diplomacy’; “a common system of defence”; [and] “
a commonAfrican citizenship.”
In effect, Nkrumah wanted Pan-Africanism to be manifested in the form of a supranational organization that would serve as the launchpad for African integration in areas of trade and economic development, defense and security, as well as foreign policy and diplomacy.
His idea was however rejected in favor of a loose association of states which became the OAU.Apart from the objective to liberate the remaining parts of continent that were still under colonial rule for which the “OAU Liberation Committee” was created, the OAU was formed without any concrete plan for trade and economic development, security and defense or a common African platform of diplomacy with the rest of the world. The result was an organization that soon became moribund while coup d’états, conflicts, human right violations and economic misery plagued the continent.
However, after a painful realization of the economic woes that had plagued the continent, the OAU at its 1980 Extraordinary Summit in Lagos, Nigeria adopted what became known as the “Lagos Plan of Action for Economic Development of Africa (1980—2000)”. It was decided that the Lagos Plan of Action would be implemented through the setting up, “by the year 2000, on the basis of a treaty to be concluded, an African Economic Community, so as to ensure the economic, social and cultural integration of our continent”.
It was in the light of this that the Treaty on the Establishment of the African Economic Community 1991 (“the Abuja Treaty”) was adopted by the OAU in Abuja, Nigeria in 1991 and came into force in 1994. Under the Abuja Treaty, African states committed themselves to
- To strengthen existing regional economic communities (RECs) and establish new RECs in regions of Africa where none existed (target date of 1999);
- To stabilize or freeze tariff and non-tariff barriers to trade within the RECs (target date of 2007);
- To gradually remove tariff and non-tariff barriers to trade at the level of each of the RECs (i.e., to create a Free Trade Areas within the RECs) followed by the establishment of a common external tariff by each REC with third states to create a Customs Union (target date of 2017);
- To coordinate and harmonize tariff and non-tariff systems among the RECs and adopt a common external tariff with third states (at the continental level) leading to the creation of a Continental Customs Union (target date of 2019);
- To establish an African Common Market through the adoption of common policies in areas such as transport, communications and industry and the harmonization of monetary and fiscal policies (target date of 2023); and
- To consolidate and strengthen the African Common Market through the introduction of free movement of persons, goods, capital and services; a right of residence and establishment; an African Central Bank and a common African currency, etc. (target date of 2028).
Based on the above roadmap, Stage 3 which is where AfCFTA falls should have been implemented by the year 2017. Yet the AfCFTA Agreement that provides the detailed legal and institutional framework for that stage was adopted by the African Union only in March 2018. While the delay is unfortunate, it is at least refreshing that, finally, part of the Pan-African vision that Nkrumah articulated in 1963 is eventually going to see the light of day. If ratified by all 55 members of the AU, AfCFTA’s “market size is expected to include 1.7 billion people with over $6.7 trillion of cumulative consumer and business spending” by the year 2030.
III. Understanding the Nature of AfCFTA and role of the AfCFTA Secretariat
Economic integration, the objective of the AEC as created by the Abuja Treaty, is “the process by which different countries agree to remove trade barriers between them.” Such “trade barriers can be tariffs (taxes imposed on imports to a country), [or non-tariff barriers such as] quotas (a limit to the amount of a product that can be imported) and border restrictions.” Because it is a process, economic integration is implemented in stages just like the roadmap in the Abuja Treaty illustrates. For all economic integration arrangements, the establishment of a Free Trade Area (FTA) is seen as the significant first step in the integration process. In an FTA, the parties, through a Free Trade Agreement (such as the AfCFTA Agreement), eliminate all import tariffs and quotas on goods from all sectors or particular sectors of their economies.
However, each member of the FTA maintains an independent trade policy with third countries including the imposition of tariffs or quotas on products from such countries. The idea is to create an expanded and unrestricted market for goods produced by members of the FTA, to the exclusion of third countries. Accordingly, to ensure that goods originating from third countries are not brought into the FTA to be sold duty-free or quota-free, rules of origin are established.
Rules of origin specify the criteria for determining the nationality or country of origin of a product. Thus, a rule of origin may, for instance, require that before a product is transferred duty-free within the FTA, it must have been wholly or partly produced in a member country. Failing that, it may be required that a certain percentage of the raw materials used in the production should have been sourced from the member country.
In this regard, a product which is imported from a third country and only repackaged within the FTA, may not qualify under the rules of origin for duty-free or quota-free treatment. AfCFTA’s rules of origin are still being negotiated within the African Union. It was one of the concerns that Nigeria had about AfCFTA for which reason it did not sign the AfCFTA Agreement when it was formally opened for signatures.
Nevertheless, Nigeria has since reversed course, probably reasoning that it is better to join the AfCFTA while outstanding issues like the rules of origin are addressed through further negotiations.
FTAs may also include mechanisms for dispute settlement. Dispute settlement procedures under the AfCFTA Agreement are provided in the Protocol on the Rules and Procedures on Dispute Settlement (“the Dispute Settlement Protocol”). The Protocol provides for the establishment of ad hoc Dispute Settlement Panels to hear disputes in the first instance with a right of appeal to the Appellate Body, a standing body of seven legal experts. Alternative dispute settlement options such as arbitration, conciliation and mediation have also been provided for in the Protocol.
Apart from the dispute settlement mechanism, the AfCFTA Agreement creates other institutional structures for the implementation of AfCFTA. One of such institutions is the Secretariat which is provided for in Article 13 of the AFCFTA Agreement. Paragraph 1 of the Article states that “the Assembly [of the AU] shall establish the Secretariat, decide on its nature, location and approve its structure and budget.”
However, pending the operationalization of the Secretariat, the African Union Commission is to be the interim Secretariat. Having accepted Ghana’s bid to host the Secretariat, it is for the Assembly to now formally establish the Secretariat, decide on its nature and structure and confirm Ghana as the seat of the Secretariat.
It must be quickly pointed out, however, that while the AfCFTA Agreement vests the power to establish the Secretariat in the Assembly of the AU, it curiously states that the “roles and responsibilities of the Secretariat shall be determined by the Council of Ministers of Trade.” Yet, since Article 11(5) of the AfCFTA Agreement provides that decisions of the Council of Ministers of Trade “that have legal, structural or financial implications shall be binding on State Parties upon their adoption by the Assembly”, it seems that the Council’s determination of the “roles and responsibilities of the Secretariat” is subject to the ultimate approval of the Assembly. In effect, it is the Assembly of the AU that will determine the roles and responsibilities of the Secretariat albeit on the recommendation of the Council of Ministers of Trade.
Nevertheless, the AfCFTA Agreement and its Protocols spell out some of the functions that the Secretariat is expected to perform. Among others, the Secretariat is required to:
- receive from AfCFTA members notifications of laws, regulations or administrative rulings on trade covered by the AfCFTA Agreement and any actual or proposed measures that might materially affect the operation of the AfCFTA agreement;
- circulate proposals for amendments of the AfCTA Agreement and comments on such proposals to all AfCTA members;
- coordinate and provide technical assistance and capacity building for the implementation of the AfCFTA Agreement and the Protocols annexed to it;
- prepare, in consultation with member states, annual factual reports to facilitate the implementation, monitoring and evaluation of the various Protocols including the Protocol on Trade in Goods;
- keep itself informed of all disputes arising under the AfCFTA Agreement and its Protocols;
- create and maintain an indicative list or roster of individuals who are willing and able to serve on Dispute Settlement Panels that may be established to resolve disputes arising under the AfCFTA Agreement and its Protocols;
- receive from each State Party the nomination of two persons for inclusion in the Roster of Panelists;
- propose from the Roster of Panelists the persons who should be empaneled to hear a particular dispute subject to the right of disputing state parties to object to a proposed Panelist for compelling reasons;
- fill vacancies on the Appellate Body within one month after the Dispute Settlement Body has failed to fill such a vacancy;
- organize special training courses for interested State Parties concerning the dispute settlement procedures and practices to enable such State Parties to develop expert capacity on the Dispute Settlement Mechanism;
- assist Panels with information the on legal, historical and procedural aspects of the cases; provide secretarial support to Panels and make available to Panelists experts with extensive experience in International Trade Law to assist them.
These functions are of course without prejudice to any additional roles or responsibilities that the AU Assembly may, on the recommendation of the Council of Trade Ministers, entrust to the Secretariat.
IV. Operationalizing the Secretariat
Currently, there is no information on the AU website to suggest that the AU Assembly has formally taken the Decision establishing the AfCFTA Secretariat as provided for in Article 13 of the AfCFTA Agreement. I will therefore proceed on the assumption that the Assembly is yet to do so.
If my assumption is true, then it means the AU Assembly will now have to announce the Decision formally establishing the Secretariat and naming Ghana as its Seat. That Decision will have to indicate the departments or units within the Secretariat, the designation of the Head of Secretariat (eg as “Secretary General” or “Director General”, etc.) and any other things relevant to the nature and structure of the Secretariat. Consistent with Articles 11(5) and 13 of the AfCFTA Agreement, the Council of Trade Ministers will also have to determine the roles and responsibilities of the Secretariat, including the ones listed above, for the approval of the AU Assembly.
When matters of organizational structure and responsibilities of the Secretariat are sorted, the next step towards operationalizing the Secretariat must be the conclusion of a host agreement between Ghana and the African Union. In the law of international organizations, a host agreement (or “headquarters agreement”) is a treaty that is concluded between an intergovernmental organization and a state to permanently or temporarily host the organization or any of its organs or specialized agencies within the territory of the state. Host agreements typically “regulate the status, privileges, immunities, and activities of [the] organization, institution, or body in the territory of the host state.”
Under the AfCFTA Agreement, the Secretariat is created as a “functionally autonomous institutional body within the African Union system with an independent legal personality”. This apparently means that the AfCFTA Secretariat is a separate legal entity (i.e., a “specialized agency” with a mandate of trade) that will operate autonomously of the African Union
But, generally, apart from a few special provisions that may reflect the conditions of the host state or the organization that is being hosted, host agreements tend to be fairly standard. Therefore, although the Ghana-AU Host Agreement is yet to be concluded, one can fairly guess what the legal obligations of Ghana will be, having regard to the African Union’s Criteria for Hosting AU Organs 2005 and similar agreements that the AU has concluded with other African States. For example, the 2007 Host Agreement between Tanzania and the AU on the seat of the African Court on Human and Peoples’ Rights in Arusha provides useful insights if one were to regard it as a template for the Host Agreement on the AfCFTA Secretariat. Extrapolating from that that Agreement, Ghana’s obligations under the Host Agreement with the AU on the AfCFTA Secretariat are expected to include:
- Providing a secure, equipped and furnished facility at its expense to serve as the seat of the AfCFTA Secretariat;
- Guaranteeing the immunity and inviolability of the premises, property, funds and assets of the Secretariat (wherever they are located within Ghana) against legal processes such searches, seizures, execution processes and expropriations, except where the Secretariat has waived such immunity;
- Guaranteeing the inviolability of the archives or documents of the Secretariat and of all official communications or correspondence of the Secretariat;
- According the head of the Secretariat and other categories of staff (as may be specified in the Agreement) full diplomatic immunities including immunity from civil or criminal proceedings for anything done or said by them in course of their official duties as required by the General Convention on Privileges and Immunities of the OAU 1965 and the Vienna Convention on Diplomatic Relations 1961; and
- Granting an unimpeded right of entry into, exit from and movement within Ghana for the head and staff of the Secretariat and all other persons who may travel to Ghana to conduct business with the Secretariat.
Apart from the special obligation to provide a facility to accommodate the Secretariat at its own expense (which is sort of the consideration for getting to host the Secretariat) the rest are essentially diplomatic obligations that already exist for Ghana under the General Convention on Privileges and Immunities of the OAU 1965 and the Vienna Convention on Diplomatic Relations 1961. In effect, what the AU-Ghana Host Agreement on the AfCFTA Secretariat will basically do, is to apply these obligations mutatis mutandisto the Secretariat, its personnel, properties and operations.
I have argued elsewhere that Parliament’s mandate, under Article 75 of the 1992 Constitution of Ghana, to ratify an agreement, treaty or convention executed by or on behalf of the President in the name of Ghana does not contemplate “agreements that are executed to implement already existing international obligations.” That argument is based on the view that if, in exercise of its foreign policy powers, the Executive Branch concludes an agreement that does not create new international obligations for Ghana or require the alteration of Ghanaian laws, then, consistent with the doctrine of separation of powers, the intervention of the Legislative Branch is not required.
Nevertheless, the Supreme Court’s view is different. The Court has held that if by any form of documentation “the Government of Ghana binds the Republic of Ghana to certain obligations in relation to another country or group of countries, [or an Intergovernmental Organization] an international agreement comes into existence” requiring parliamentary ratification.
So, despite the fact that the Host Agreement on the AfCFTA Secretariat may not require Ghana to undertake any more obligations than what the country already has towards the AU and its organs, to be compliant with our constitutional requirements, the Agreement will still have to be sent to Parliament for ratification.
V. The Likely Benefits of AfCFTA and its Secretariat to the Ghanaian Legal Community
There are a number of benefits that the legal community in Ghana stands to gain from AfCFTA and the hosting of its Secretariat in Ghana. There will be something for all the major players: lawyers, judges, legal academics and law students as well.
(a)The Dispute Settlement Opportunities
The Dispute Settlement Mechanism under AfCFTA is modeled on that of the World Trade Organization (WTO). Like the WTO, AfCFTA will operate a two-tier process. A case filed by an AfCFTA member will in the first instance be adjudicated by a three-member Panel selected from the Roster of Panelists maintained by the Secretariat. Appeals from the findings and conclusions of a Panel, on questions of law, will then lie to the standing Appellate Body established under Article 20 of the Disputes Settlement Protocol. Ghanaian lawyers, judges and legal academics who have relevant expertise in International Trade Law stand the chance to be nominated to serve on the Panels or the Appellate Body. Regarding the Panels, for instance, each AfCFTA member including Ghana has the right to annually propose two individuals to the Secretariat for inclusion in the Roster of Panelists. It is from this pool that Panels will be constituted for the settlement of disputes whenever the need arises. In addition, the Secretariat is mandated to have on call “experts with extensive experience in International Trade Law to assist the Panelists.”
Therefore, for those who may not have the opportunity to serve on Panels or the Appellate Body, there is still an opportunity to contribute their expertise and experience to the AfCFTA dispute settlement system as consultants. I should not fail to mention, that in all these, lawyers will be needed to argue the cases that will come before the Panels and the Appellate Body. AfCFTA, therefore, presents additional legal business that Ghanaian lawyers with the requisite expertise can compete for.
(b) Opportunities for Academic Collaborations and Research
The Secretariat is mandated to organize training workshops and seminars to build the capacities of African government officials and other persons who would be involved in the implementation of AfCFTA on the continent. This presents an enormous opportunity, particularly, for Ghanaian legal academics. Through collaboration with the Secretariat, faculty members of law schools who have expertise in International Trade Law could become facilitators for such capacity building programs.
Indeed, the collaboration could even go much deeper to involve the development of courses on AfCFTA and other relevant aspects of African Union Law to be run by the partner law schools on behalf of the Secretariat. Apart from these possible collaborations, the mere presence of the Secretariat in Ghana also presents other opportunities.
Academics who have research interests in trade and regional integration law will be able to easily access the library and other resources of the Secretariat and also obtain information that may assist their research. Also, because
(c) An International Law Experience for Students
For students of International Law who do not often see the relevance of the subject or complain about it being abstract, et cetera, the hosting of the AfCFTA Secretariat in Ghana presents an opportunity for change. For the first time, Ghanaian law students will have close home to them, an institution that will be running an International Dispute Settlement System. Although the Dispute Settlement Protocol is silent on where the Panels and the Appellate Body are supposed to meet for the conduct of their business, if WTO practice is the benchmark, then one can be sure that most, if not all, of such meetings will be held at the Secretariat.
So hopefully, not only might there may be opportunities for students to undertake internships at the Secretariat, they could possibly also have the opportunity to serve as research assistants or clerks to the Panelists and Appellate Body members. This rare privilege to observe and interact with “International Law in action” will hopefully help to develop a more positive attitude towards the study of International Law in Ghana.
What I have sought to do in this essay is to provide a brief exposition on the history and nature of AfCFTA, discuss role of the AfCFTA Secretariat, which Ghana has won the bid to host, and to indicate the benefits that the Ghanaian legal community stands to gain from AfCFTA and the presence of its Secretariat in the country. Undeniably, AfCFTA is potentially a big win for Africa and probably going to be a bigger win for Ghana, especially since the country has won the bid to host the AfCFTA Secretariat.
The benefits that come with AfCFTA are, however, not going to be automatic. All stakeholders, particularly members of the legal community, must properly position themselves. Apart from the core area of International Trade, AfCFTA will deal with other matters such Intellectual Property, Foreign Investment and Competition Policy. Law firms, individual lawyers and judges, as well as the law schools that do not have sufficient expertise in International Law generally, and in the AfCFTA areas of law in particular, must begin to acquire or develop it. It will be most tragic, if after all these efforts that have been put into winning the bid to host the AfCFTA Secretariat, Ghanaian lawyers, academics and other legal experts are under-represented in the proceedings of the Panels and the Appellate Body, the training and capacity building programs of the Secretariat or the alternative dispute settlement mechanisms such as the arbitration, conciliation and mediation procedures.
I am grateful to my colleague Delali Adzo Gawu, Esq. for proofreading the draft and providing me with her invaluable comments and suggestions.
See Mohamend Bedjaoui, ‘Brief Historical Overview of Steps to African Unity’ in Abdulqawi Yusuf & Fatsah Ouguergouz (eds), The African Union Legal and Institutional Framework: A Manual on the Pan-African Organisation(2015) 11
See Abdulqawi Yusuf, Pan-Africanism and International Law(Hague Academy of Int. Law, 2014) 30-32
Kwame Nkrumah, We Must Unite Now or Perish!(Speech Delivered at the Summit of African Heads of State and Government, Addis Ababa, 24 May 1963)
In the run-up to the Addis Ababa Summit, the independent African states of the time were essentially split into blocs with divergent viewpoints on the nature and form African unity should take. The Casablanca Group was the group of states that shared Nkrumah’s vision of immediately forming a Union of African States under a continental government. The Monrovia Group (together with another splinter group known as the Brazzaville Group) preferred a loose association of states in the meantime while working gradually towards a future continental government built on the foundation of strong regional groups. The “gradualists” won the debate at the 1963 Addis Ababa Summit.
The Final Act of Lagos, (Annex I to the Lagos Plan of Action)
See Article 6 of the Abuja Treaty 1991
The agreement entered in force after obtaining the minimum number of ratifications on 30 May 2019.
Landry Signe, African Leaders have created the World’s largest Free Trade Area since the WTO—Here’s its Potential (27 March 2018) QZ.COM; https://qz.com/africa/1238185/africa-creates-worlds-largest-free-trade-area-since-wto-heres-its-potential/
Carleton University Center for European Studies, What is Regional Integration? https://carleton.ca/ces/eulearning/introduction/what-is-the-eu/extension-what-is-regional-integration/
In the case of AfCTA, because it expected that each of the RECS making up the AEC would have attained the status of a Customs Union by now, the trade policy of each member of AfCTA with third countries would be the same as that of the REC to which it belongs. This is because a Customs Union maintains a common trade policy including a common external tariff with third states.
See Jennifer Okpala, Nigeria: African Continental Free Trade Area (AfCFTA) (2 Nov. 2018) http://www.mondaq.com/Nigeria/x/751224/international+trade+investment/African+Continental+Free+Trade+Area+AfCFTA
The Dispute Settlement Protocol is one of the protocols additional to the AfCFTA Agreement. The AfCFTA Agreement and its Protocols constitute a single undertaking for the state parties.
Article 13 (4) of the AfCTA Agreement 2018
Article 17 of the AfCFTA Agreement
Article 29 of the AfCFTA Agreement
 See eg, Article 29 of the Protocol on Trade in Goods; Article 27 of the Agreement on Trade in Services
Article 31 of the Protocol on Trade in Goods.
Article 10 of the Dispute Settlement Protocol
Article 10 of the Dispute Settlement Protocol
Article 10 of the Dispute Settlement Protocol
Article 20(2) of the Dispute Settlement Protocol
Article 28(2) of the Dispute Settlement Protocol
Article 29 of the Dispute Settlement Protocol
See Jochen Herbst, ‘Host State Agreements’ in Max Planck Encyclopedia of International Law
Article 13 of the AfCFTA Agreement
EX.CL/195 (VII) Rev.1
Christopher Y Nyinevi, The Making of Treaties under the Municipal Law of Ghana: A Review of the “Guantanamo Detainees Case”(A paper presented at the Lancaster University Ghana Law Colloquium, 2018).
See Margaret Banful v Attorney General (Writ No. J1/7/2016) (Judgment: 22 June 2017) 13
See Articles 9 and 10 of the Dispute Settlement Protocol
According to Article 21 (4) of the Dispute Settlement Protocol, the appeal must be on questions of law.
See Article 29(3) of the Dispute Settlement Protocol