E-commerce protocol to be incorporated into AfCFTA agreement

Following the launch of three protocols needed to be implemented to safeguard the second phase negotiations of the African Continental Free Trade Area (AfCFTA) agreement in Accra last month, the World Economic Forum and International Trade (ITC) have initiated steps for an e-commerce protocol to be incorporated in the AfCFTA agreement.

This follows the release of the African E-commerce Agenda – an eight-step action plan, put forward by the World Economic Forum and the ITC as they unveiled a roadmap on e-commerce for African governments to realise its vast economic potentials and benefits for the continent.

The eight agenda action plan include “refresh policies on e-commerce; expand internet connectivity; upgrade current logistics; enable e-payments; and “manage e-commerce data”. The rest are “grow the tech industry; coach small business and; join forces with the private sector to realise the benefits of e-commerce.

“The future of trade is digital, and a large component of e-commerce has the potential to transform how businesses in Africa produce, sell and consume goods and services. This eight-point plan sets out the e-commerce ecosystem in which governments and the business community need to invest in order to harness the power of digital marketplace”, ITC Executive Director, Arancha González said.

Instructively, during the event, African Union Commissioner for Trade and Industry, Ambassador Albert M. Muchanga stressed the potential benefits on e-commerce, adding that “Africa will fully leverage on it to secure hers”.

Initially, the African Union Trade and Industry did not adopt e-commerce as an area for negotiations under the second phase AfCFTA agreement. However, the move by Ambassador Muchanga implies that the AU is bent on instituting a timely e-commerce protocol for the free trade area agreement.

This major step falls in line with the proposal made in Accra last month by Dr. David Luke, the Coordinator of African Trade Policy Centre (ATPC) – one of the key AfCFTA implementing institutions, during a three-day consultative National Conference designed to focus Ghana’s collective efforts on specific actions and policies needed to be taken in Ghana to implemented the agreement.

“What we are proposing is that there are several ways we can achieve coherence on e-commerce. We can do this through a protocol, digital e-commerce system or through existing African Union policy instrument that can be incorporated in the AfCFTA agreement”, Dr. Luke asserted.

Dr. Luke stressed that having an e-commerce protocol has become eminent as policies and practices are evolving on the continent and that there is the opportunity under the AfCFTA agreement to leapfrog through the new digital technology that are available which are already in use by entrepreneurs in e-commerce.

Background

Reports indicate that e-commerce has the potential to create more than three million new jobs in Africa by 2025, yet e-commerce start-ups face many obstacles, including low consumer digital trust, poor infrastructure and low regional integration.

Building on consultations with business leaders and experts, the Africa E-Commerce Agenda is a call to action for Africa’s political leaders, the international trade community and the development community to fully utilize its benefits; an ITC statement reads.