The Promise and Challenge of the African Continental Free Trade Area 273
disputes that may arise beyond states, such as those between private enterprises and multinationals, for example. In addition, the multiplicity of languages, legal institutions, and cultures poses challenges in streamlining legal systems across the region. There is a need for a continental body that addresses these challenges and has the authority to mediate and enforce decisions of arbitrations within and across countries. This body should be strongly supplemented by traditional diplomatic or political approaches to resolve disputes. In addition, there is a need for a provision in the AfCFTA agreement that allows arbitration between investors and states over claims of breaches of the trade agreement. This provision could be bolstered by a regional entity that monitors these arbitrations. These mechanisms are essential to address not only disputes within Africa but also trade conflicts with parties outside the continent. The challenge of enforcing the rules, including border and customs rules, is reinforced by the partially arbitrary nature of the colonial borders in the region, coupled with strong ethnic connections between communities across borders. Disparities in countries’ economic size also pose challenges to impartial enforcement and resolution of trade disputes—as evidenced by Nigeria’s unilateral border closure in August 2019 to block the flow of goods between itself and neighboring Benin, Cameroon, Chad, and Niger. Though trade agreements are accompanied by intricate dispute resolution mechanisms, they are often underused. As the African Union works on developing the dispute settlement mechanisms for the AfCFTA, there is a need to also consider how to increase their use. Given the ambitious industrialization agenda of the African Union and its members, disputes on rules, particularly the rules of origin, are expected to be recurrent in trading manufactured goods as the AfCFTA becomes more active. This suggests the need to address the challenges associated with origin fraud. In addition to setting the rules of regional trade, African countries need to establish national and regional institutional frameworks to monitor and ensure compliance with the rules and address illicit trade practices when they are reported. The African Union’s recent online initiative to facilitate the reporting of illicit trade and trade disputes—the AfCFTA Non-Tariff Barriers Reporting, Monitoring and Eliminating Mechanism10— is a step in the right direction.
Policy Implications The AfCFTA is an ambitious project that requires massive investment in resources, reforms, increased cooperation from members, and relinquishment of some control over national policies. Africa suffers from challenges that most other regions do not face; hence, the AfCFTA requires unprecedented levels of commitment to succeed. The fundamental challenges include the region’s high level of fragmentation and thick borders, both of
