Posted: July 25, 2022
At a ceremony held in Accra, Ghana today, South Africa’s Minister of Trade, Industry and Competition, Mr Ebrahim Patel concluded his 2-year term as chair of the African Council of Trade Ministers with a call for faster implementation of industrialisation efforts, buttressed by the new African continent-wide free trade area.
“Greater trade and investment among African countries can boost industrialisation on the continent, transforming the continent’s rich natural resources to high-value capital and consumer goods. The pandemic, war in Europe and global supply-chain disruptions have imposed a high price on African economies with the largest drop in African GDP in twenty years, causing high food and fuel prices and plunging many citizens into poverty. We need to draw lessons from this and work to change our economic trajectory, placing greater focus in the future on food production and the expansion of manufacturing in Africa,” Minister Ebrahim Patel said at the African Council of Trade Ministers meeting.
South Africa chaired the twin structures of African Trade Ministers from Sept 2020.
The period of chairing coincided with unusual and turbulent times: these included the Covid-19 period, the conflict in Ukraine, disruptions in supply-chains and the effort by African countries to build their industrial capacity to manufacture masks, ventilators, vaccines; as well as diagnostics and therapeutics needed to fight Covid-19. It saw too the appointment of the first African and first female Director General of the World Trade Organisation, in part through the work of African trade ministers; and the convening of the 12th Ministerial Conference of the WTO held in Geneva last month.
In his closing address, Minister Patel noted the need to inject a higher ambition in the rules of origin and the level of African content for all goods that will trade with preferences, so that the economic and employment value of the free-trade agreement is captured on the continent and that Africa breaks the neo-colonial pattern of being solely a supplier of raw materials to the world at the expense of developing its own industrial capability
He called on African countries to complement trade reform activities with industrial policy support measures to complement such reforms; placing more attention on regional value-chains and investment as a core driver of industrialisation. Opportunities which exist in food and health-care security value chains, can only be unlocked through application of investment, trade and industrial policy measures.
Minister Patel called for greater urgency in facilitating the start of trading under the African Continental Free Trade Area (AfCFTA), using the package of agreed areas, learning from the experience of implementation and using that experience to expand the scope of work further.
NOTE TO EDITORS – BACKGROUND INFORMATION ON SOUTH AFRICA’S PERIOD AS CHAIRPERSON:
In the past 22 months of South Africa’s chair-ship, the African free trade project has made significant progress. The AfCFTA treaty was ratified by 14 additional countries, being Angola, Cameroon, Central African Republic, Lesotho, Nigéria, Tunísia, Zambia, Algeria, Burundi, Seychelles, Cabo Verde, DRC, Tanzania and Morocco.
The AfCFTA moved into detailed operational mode in the period, with the establishment of 13 committees or sub-committees, covering among others, committees on rules of origin; non-tariff barriers to trade; sanitary and phyto-sanitary measures; trade remedies; technical barriers to trade, mutual recognition of professional qualifications and AfCFTA trade in services rules.
A dispute settlement body was agreed and established.
South Africa chaired eight meetings at Ministerial level, with more than 50 meetings of officials to put together the complex agreements to enable the beginning of trade on preferential rates.
Over this period, member states were able to agree to additional rules of origin covering some 853 industrial or agricultural products, mainly capital goods used within the industrialisation process; and food products for African food security. These goods included machinery, fish products, edible oils, dairy products, raw sugar, fruit juices, wheat flour, spices animal food and leather products.
Progress was made with services negotiations, with 15 offers made by countries.
South Africa’s chairing included the period when the 12th Ministerial Conference of the World Trade Organisation (WTO) took place, with a unified African position on a range of trade areas.
Africa left its mark on the talks. MC12 was able to finalise a significant agreement on intellectual property flexibilities and waivers, that enables the production of vaccines and their ingredients here on the African continent. MC12 also finalised an agreement to respond to the problem of illegal, unregulated and unreported foreign fishing vessels that strip African coastlines of its fish stocks.
Other significant agreements championed by African countries included measures to contain food price increases through a consensus on avoiding export bans on food products; and an agreement to limit the moratorium on eCommerce customs duties until early 2024 and to provide an opportunity for digital industrialisation measures to be pursued for the global south.
On WTO reform, African countries were able to secure agreement that development objectives would be part of the terms of reference of discussions on the future of the body; and a number of African countries referred to the need for special measures and flexibilities in the WTO to enable African industrialisation.
Bongani Lukhele – Director: Media Relations
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Issued by: The Department of Trade, Industry and Competition (the dtic)
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