The following is an extract from this publication.
The African Continental Free Trade Area (AfCFTA) agreement officially commenced operationalization a year ago, forming the cornerstone of trade integration in Africa. The objective of the AfCFTA encompasses the creation of a single continental market and aims to enhance competitiveness at the enterprise level. From a business perspective, the AfCFTA is a tool to help African busi- nesses benefit from the great opportuni- ties that our growing continent can offer on both the supply and demand sides.
Alongside the AfCFTA, the AfCFTA Cou try Business Index (ACBI) was launched in 2018 by the Executive Secretary of the United Nations Economic Commission for Africa (ECA)1. The ACBI is seen as one of the primary tools through which businesses can voice their views on the implementation of the AfCFTA by identifying main trade constraints. The ACBI aggregates the opinions of businesses in Africa and articulates them in an index that ranks countries by how well they are implementing the AfCFTA from a business’s perspective.
A key focus of the ACBI is to understand business perceptions of trading under the free trade agreements (FTAs) already in force across African countries. By fo- cusing explicitly on the constraints and challenges faced by private business, the ACBI is a tool through which key private sector challenges on cross-border activi- ty can be distilled and identified through the following main objectives:
• Measure the extent of implemen- tation of broader African integra- tion and trade related develop- ments, based on private sector views.
• Understand business perceptions of trading under the free trade agreements (FTAs) already in force across African countries.
• Assess the perceived impact of the AfCFTA on the private sec- tor’s ability to trade and invest across African borders, once the AfCFTA is operationalised.
1ECA has commissioned the ACBI data collection to DNA Economics and Ask Afrika under the leadership of Mr. Yash Ramkolowan, Director, DNA Economics. The ECA team is constituted by Ms. Wafa Aidi, Economic Affairs Officer, Regional Integration and Trade Division (RITD), Mr. Rodgers Mukwaya, Economic Affairs Officer, Sub-re- gional office for East Africa (SRO-EA) and Mr. Thomas Yapo, Consultant, RITD under the leadership of Mr. Ste phen Karingi, Director, RITD and Ms. Mama Keita, Director, SRO-EA, ECA.
In its conceptualization, the ACBI is close ly linked to the AfCFTA. This agreement covers policy issues and areas beyond just the trade in goods. Negotiations under this agreement will cover trade in services, investment, competition policy and intellectual property rights with future rounds of negotiations also covering issues related to e-commerce. The ACBI consists of 3 broad dimensions:
• Goods restrictiveness and costs: this dimension seek to understand business perceptions of the ease / difficulty of trading across borders in Africa.
• African FTA knowledge and use: this dimension summarise firm perceptions of their awareness, information access and use of African FTAs.
• Commercial environment: this dimension capture business perceptions of the domestic environment related to services and oth er “new generation” issues under negotiation in the AfCFTA.
Following the launch of the index, ECA embarked on piloting and refining this index as a tool to measure and compare business views on the implementation of the AfCFTA across the continent. Cameroon and Zambia were selected as the two initial countries in which the pilot survey was to take place.
Subsequent to this pilot, the ACBI methodology has been refined and surveys conducted in a further 7 countries namely Angola, Côte d’Ivoire, Gabon, Kenya, Namibia, Nigeria, and South Africa. This summary includes results based on the 2nd phase rollout. At a 3rd phase, the ACBI will be rolled out in the Democratic Republic of Congo, Egypt, Rwanda, Senegal, and Tunisia.