By Sarah Lawan, Regional Co-operation Advisor, Networks, Partnerships and Gender Division, OECD Development Centre, and Rodrigo Deiana, Junior Policy Analyst, Europe, Middle East and Africa Unit, OECD Development Centre
Learn more about this timely topic at the upcoming
18th International Economic Forum on Africa
As early as 1963, in the midst of independence movements, Kwame Nkrumah urged, “Africa must unite or perish!” The first president of Ghana pronounced this injunction at the founding meeting of the Organisation of African Unity (OAU) in Addis Ababa, Ethiopia.
The post-colonial thirst for “breaking with the old order and indigenising the direction of Africa’s economic development”1 led to the shaping of the African Economic Community (AEC), a pan-African single market. Africa reclaimed its leadership and ownership with the goal of promoting a self-sustained and self-reliant development trajectory.
2018 witnessed an acceleration of integration efforts with the landmark agreement on the African Continental Free Trade Area (AfCFTA) in Kigali on 21 March. So far, 49 African countries have signed the AfCFTA, which will be the world’s largest free trade area since the WTO’s creation. As the late Calestous Juma put it: “The continent’s regional integration is the most complex and elaborate effort of its kind ever mounted in human history.”2
This historic agreement opens tremendous prospects for transformation by paving the way for a single market of 1.2 billion people and over USD 3 trillion in GDP. Deeper economic integration could still bring significant benefits to the continent. Fully liberalising trade in goods could boost Africa’s GDP by 1% and increase total employment by 1.2%, according to UNCTAD. Intra-African trade could increase by 33%, halving the continent’s trade deficit.3
Given the continental scope of the AfCFTA, do existing regional bodies still have a role to play?
Creating a new continental-level structure should not mean reinventing the wheel; precedents are many, with virtuous examples and homegrown experiences from which to draw. Africa is home to a complex puzzle of regional bodies and initiatives, each with their specificity but all aiming towards the continent’s integration. These bodies and initiatives cover multiple facets of regional co-operation to achieve multidimensional development targets.
The 1991 Abuja Treaty formalised and articulated the relationships between the AEC and Regional Economic Communities (RECs), sub-regional bodies composed of groupings of African countries. The treaty rationalised the integration process, building on the RECs to establish the AEC through “the co-ordination and harmonisation of activities among the existing and future economic communities.”4
Active in the areas of peace and security, development and governance, the RECs aim at a more integrated continent and Africa’s better integration in the world economy. These blocs range from free trade arrangements to common markets and monetary unions, such as the Southern Africa Development Community (SADC), the East African Community (EAC), and the West African Economic and Monetary Union (WAEMU). Even though boosting intra-regional trade has been a longstanding priority across all RECs, the EAC is the only REC where trade costs have fallen, and SADC is the only REC where intra-regional trade reached over 5% of GDP after 10 years of free trade between its member countries.5
In addition, the Africa Regional Integration Index shows that financial sector integration and free movement of people still lag behind.
Alternative dimensions of regional co-operation exist in the areas of infrastructure development and natural resource management. The “development corridor” approach seeks to overcome the lack of regional connective infrastructure and to allow local economies to reap the benefits of infrastructure development. The Lamu Port-South Sudan-Ethiopia Transport (LAPSSET) Corridor is a Kenyan infrastructure project aiming to open up the northern part of the country and to add 3% to Kenya’s GDP by 2020.6
Other institutions attempt to coordinate the sharing and preservation of resources (e.g. freshwater, fisheries, hydroelectric production), which carry strategic and geopolitical consequences. For example, the Commission du Bassin du Lac Tchad (CBLT) was created to manage water resources, protect the lake’s ecosystem, and promote regional integration, peace and security.
Africa’s integration as it stands today is heterogeneous, with a multitude of overlapping memberships. In fact, 40 countries are members of more than one REC.7
Regional bodies must avoid the pitfalls of adding a redundant layer of bureaucracy and fragmenting the continental integration agenda. Instead, by capitalising on their practical knowledge, such regional bodies can actually embody the pioneers of African unity under the aegis of the African Union. The regional scale may turn out to be instrumental to implement the AfCFTA and lay the ground for the AEC.
Indeed, regional bodies have a part to play in Africa’s integration for the following reasons:
National governments in Africa are already accustomed to and actively participate in regional decision-making processes. This confers legitimacy to regional engagement at the political level with increasing awareness and adherence from the private sector and civil society.
Regional organisations can share experiences and foster exchanges of know-how amongst policy makers and increase capacity and institutional memory. This hands-on experience is indispensable to sustain the progress towards continental integration.
Regional entities cover a wide range of areas (e.g. environment, peace, infrastructure) that are complementary to the AfCFTA’s focus on trade. This multidimensional feature can help secure all aspects of sustainable development (including social and environmental) and achieve Agenda 2063 aspirations.
A step-by-step approach to continental integration tailor-made by regions, with benchmarks and monitoring, could ensure more organic processes, such as harmonised policies and buy-in from the private sector and civil society. The regions can position themselves as “integration watchdogs” to ensure that all strata of the population share the gains from the AfCFTA.
Regional bodies can experiment regionally with continental solutions and allow officials to benefit from a “learning by doing” effect. “This learning opportunity often gets ignored by those seeking to assess the effectiveness of regional bodies.”8
Africa’s development partners should acknowledge and support this renewed integration agenda and momentum. The intricacy of interactions between African countries along multiple dimensions might very well call into question the adequacy and relevance of solely bilateral co-operation agendas. Perhaps it is time to revisit approaches to engagement in light of the priorities Africans have set for themselves to meet the continental-wide promise of an integrated, people-centred, peaceful and prosperous Africa.
1 Kouassi R.N. (2007), “The Itinerary of the African Integration Process: An Overview of the Historical Landmarks”, African Integration Review Volume 1, No. 2, July 2007
2 Juma C. and F. Mangeni (2018), “African Regional Economic Integration: The Emergence, Evolution, and Impact of Institutional Innovation”, Harvard Kennedy School Faculty Research Working Paper Series, Discussion Paper 2018-01.
3 UNCTAD (2018), African Continental Free Trade Area: Challenges and Opportunities of Tariff Reductions http://unctad.org/en/PublicationsLibrary/ser-rp-2017d15_en.pdf.,
4 Treaty Establishing the African Economic Community, Article 6.2(b)
5 De Melo, J., M. Nouar and J-M. Solleder (2017), “Integration along the Abuja road map”, FERDI Working Paper n° 191, July 2017, http://www.ferdi.fr/fr/node/3850.
6 LAPSSET Corridor Development Authority (2016), Brief on LAPSSET Corridor Project, July 2016, http://vision2030.go.ke/inc/uploads/2018/05/LAPSSET-Project-Report-July-2016.pdf.
7 AUC/OECD (2018), Africa’s Development Dynamics 2018: Growth, Jobs and Inequalities, AUC, Addis Ababa/OECD Publishing, Paris, https://doi.org/10.1787/9789264302501-en.
8 Juma C. and F. Mangeni (2018), ibidem