Africa, traditionally the world’s poorest continent, is undergoing profound changes. It has experienced higher than normal economic growth rates for over a decade, bringing benefits such as new infrastructure and improved standards of living. Hoping to sustain this growth, African policymakers have looked to trade liberalization and more integrated markets, with regional bodies at the forefront. While the regional response has considerable promise, member states need to commit to genuine reform to achieve long-term results.
For many, the ultimate goal of African liberalization is a vast, potentially continent-wide free trade zone, as represented by the Tripartite Free Trade Area (TFTA) proposal launched in June this year. This would unite the Common Market for Eastern and Southern Africa, the East African Community (EAC), and the Southern African Development Community. It would also incorporate more people than similar agreements covering North America and Europe, meaning it will take significant time to materialize. In the interim, the option of improved regional-level integration seems to offer a more rapid achievement of results.
There are currently eight regional economic communities in Africa, whose aim is to promote intra-regional trade and investment. Yet this currently amounts to only 11.7% of overall African trade with the world at present. This compares with 70% for intra-EU and 55% for intra-Asian trades, respectively. As well as enhancing economic opportunities, increased economic interdependence could also contribute to greater peace and security on the continent.
To understand how regional trade and markets could be improved, it is useful to take stock of the protocols on the free movement of goods, services, capital, and people of two regimes in particular: the long-established Economic Community of West African States (ECOWAS), and the more recent EAC, whose success will also be critical to that of the TFTA.
Both areas face comparable challenges and opportunities. They have, for example, both implemented ambitious free movement protocols that potentially offer excellent opportunities for their citizens and businesses. Unfortunately, ECOWAS and EAC also both seem to lack a clear evaluation process and proper implementation strategy for their integration efforts. New initiatives are implemented hastily, at the expense of properly testing older ones, which often leads to confusion and unnecessary hurdles in an already complex process.
ECOWAS, the oldest of Africa’s regional communities, was launched in May 1975 in Lagos, Nigeria. Its stated objective was to remove obstacles to the so-called “four freedoms” of goods, services, capital, and labor among its members.
Very little has been achieved for the first three of these, though some progress has been made on the labor front. A protocol eradicating visa and entry permit requirements within ECOWAS was ratified in 1980. As a result, citizens of member states possessing travel documents and a health certificate were, in principle, able to travel freely within the region.
However, any member state could still refuse entry into its territory to persons deemed inadmissible under national laws. In 1983 and 1985, Nigeria notably used this clause to expel immigrants mainly of Ghanaian origin from its territory. At the time, Nigeria was overwhelmed by a large number of immigrants from Ghana, and was also undergoing an economic crisis due to unsuccessful structural adjustment programs.
In 1992, ECOWAS subsequently revised its treaty to reaffirm the rights of citizens to entry, residence, and settlement in other member states. In 2008, it also redefined its common approach to migration, which is linked to the principle of free movement. ECOWAS then developed Vision 2020, which shifts emphasis from an “ECOWAS of states” to become, by 2020, an “ECOWAS of people” living within a single, borderless economic zone.
Vision 2020 foresees the introduction of a visa arrangement similar to Europe’s Shengen area, the abolition of permit requirements, the removal of roadblocks and security checks, the exchange of information by security operatives at borders, and introduction of a single regional passport.
There is, however, still a general lack of appreciation of these initiatives at the national level. Furthermore, implementation of free circulation in West Africa has frequently been thwarted by random shocks such as local military conflicts, political repression, and disease outbreaks including the recent Ebola crisis.
At first glance, EAC is more integrated than ECOWAS. Where the latter’s degree of trade between members accounts for only 9.4% of their overall record, the EAC figure stands at 12%. However, this difference is largely due to the impact of Nigerian oil sales outside of ECOWAS. East Africa’s community is considerably smaller in terms of its economic, population, and infrastructure development, but has a less pronounced imbalance between rich and poor than its larger neighbor.
EAC is also a much more recent experiment, beginning only in 2000 in its current form. Nonetheless, its members have been keen to speed up the process of increasing economic cooperation through ambitious proposals, regardless of the substantial challenges in developing the capacity to do so.
In November 2009, 30 years after ECOWAS did so, EAC countries established a common market, which became official the following year. Arguably, this was not the first attempt to set up a joint enlarged market in East Africa, since an initial experiment was initiated as early as 1967 by three of the EAC founding states, before collapsing 10 years later. Still, it was the first successful one, even though numerous hurdles remain for it to be effective.
The common market protocol’s key provisions include the free movement of persons, workers, goods, services, and capital, the right of establishment and of residence, and schedules of commitments on the progressive liberalization of services, and on reducing restrictions to the free movement of capital.
Despite this protocol, a 2014 World Bank scorecard identified no less than 63 non-conforming measures in the trade of services and 51 non-tariff barriers affecting trade in goods within EAC. The assessment also found that only two of the 20 operations covered by the common market protocol were free of restrictions.
A Test of Political Will
There are clear and potentially effective frameworks for establishing integrated economic regions in both West and East Africa. The problem lies in a lack of political will to implement them. Member states of both ECOWAS and EAC retain national laws that impede successful implementation of mutually agreed regional protocols.
The task is made more complex by the need to simultaneously address challenges in terms of regional infrastructure development and economic inequalities, as well as political conflicts and health and security issues on the local level. There is also a persistent lack of information on the advantages of regional economic integration being distributed to the ordinary African citizens, who should be the targets of the process.
Africa’s regional communities can take heart from the example of Europe’s more advanced common market, which illustrates that achieving free circulation within a region takes considerable time and effort. Recent developments in the Eurozone and Schengen travel area are also a reminder that the merits of such achievements can easily be questioned.
Nonetheless, if African leaders remain committed to the goal of regional economic integration, they must seek to bridge the gap between good intentions and requisite action. If they cannot find the dexterity to incorporate national prerogatives into the process, it may fall off pace with the current speed of regional development and the corresponding needs of their populations. It would also compromise the goals of the recently launched TFTA, which could otherwise help to coordinate trade policies between the regional communities on a pan-African scale.
Moses Onyango is a Fellow of the African Leadership Centre, Kings College London, and Director of the Institute for Public Policy and International Affairs at the United States International University-Africa. Jean-Marc Trouille is Professor of European Economic Integration and European Business Management at the University of Bradford.