The AfCFTA secretary general talks to The Africa Report about the continental trade bloc’s January launch, forging value chains and diplomatic challenges ahead.
Now that Africa’s much-vaunted free trade area has launched on 1 January, there will be big fanfare and even bigger pressure mounting for South Africa’s Wamkele Mene to make it a success.
Building up the continent’s interconnections and market of more than 1 billion people is being touted as a means to fight poverty, bring development and reduce the continent’s dependence on fickle foreign markets.
Mene, elected secretary general of the African Continental Free Trade Area (AfCFTA) in February 2020, tells The Africa Report: “I don’t want anybody to be under the illusion this is going to be easy. It’s going to be difficult, but we’ve got to do it.”
Africa’s over-reliance on exporting primary commodities is detrimental to its economic development and undermines its ambition for greater integration.
As Mene puts it, this “keeps Africa trapped in [a] colonial model of economic trajectory”. But, in dealing with trade and economy ministers from all over the continent, he says he sees a lot of goodwill.
“Everybody wants to see Africa industrialising. Everybody wants to see a digital economy on the continent. Everybody wants to see the continent leapfrogging into the Fourth Industrial Revolution,” Mene says.
This will take reducing barriers to trade and eliminating non-tariff barriers and barriers to intra-Africa investment. All of that requires economic actors on the continent to take a holistic view of the trade ecosystem.
Mene explains: “We have to reconfigure Africa’s supply chain. We have to reconfigure and relook at how we establish value chains […] in a way that [makes us] more self-sufficient as a continent.”
During his nomination, Mene got a taste of the diplomatic skills required to make a continental institution work and the role of competing national interests. Nigeria is one of the most reluctant countries to take part in the AfCFTA; President Muhammadu Buhari has closed the country’s western borders to encourage more domestic rice production and fight smuggling.
Abuja rejected an expert panel’s report that Mene, with years of working on trade for the South African government, was the most qualified for the job. And this led to a vote in which Mene won a two-thirds majority.
“When we talk about trade creating opportunities for people – and when we talk about trade as an instrument for development – that’s what I’ve seen,” he says, recalling his experiences growing up in the township of KwaNobuhle.
The settlement is on the outskirts of Uitenhage in Eastern Cape, a place well-known as the home of a Volkswagen vehicle assembly plant. Mene has personal experience of how trade deals can affect a small-town community.
A new world view
When Volkswagen started exporting to the US under the African Growth and Opportunity Act, there were almost 1,000 people who were taken from my township to go to Germany to train for the production of the new vehicles. I saw how trade can transform people’s lives. People came back with new skills. People came back with a new world view. People came back and they were able to be part of a global value chain – not just a regional value chain,” says Mene.
Trade has been Mene’s professional domain for most of his adult working life. The exception is the three or so years he spent working at a law firm. Mene cut his teeth at the department of trade and industry in South Africa and the World Trade Organisation (WTO) in Geneva, Switzerland, where he represented his country and performed ambassadorial duties.
“I’ve been in trade law, trade policy, [and] trade negotiations for a long time. I would say that [having spent] time at the WTO – about six years – I now know what works and what doesn’t work for an international trade organisation,” he tells The Africa Report.
“That preparation is valuable because we are trying to establish a new international organisation secretariat for trade. If you come into this without the benefit of having been part of an international trade secretariat, it may be difficult,” he says.
The AfCFTA secretariat is modelled on the WTO in terms of its functions and its mandate. That leaves the responsibility for implementation to the member countries. The secretariat’s mandate is to help member states implement the agreement and respect their obligations. In addition, it provides technical advice and help in capacity building.
Rules of origin
I was South Africa’s lead [AfCFTA] negotiator for a long time. I come with the benefit of knowing what would be acceptable to member countries and what would not be acceptable,” he adds.
In addition to his trade expertise, Mene speaks three languages: isiXhosa, English and French. He speaks the latter “only after midnight, when I feel more relaxed”.
That relaxation and the French language will come in handy in negotiations that will almost certainly take much longer than policymakers expect. The WTO is still negotiating the Doha Development Round, and that has taken more than 20 years, he points out.
It is still not concluded. Every trade agreement I’ve ever worked on is never concluded on time,” Mene says. There are ongoing negotiations about the implementation phase of the AfCFTA agreement.
Although there is a lot of outstanding work, “we are at about 80% concluded on rules of origin”. Those rules are critical because they determine how much of a final good will have to be ‘Made in Africa’ in order to benefit from the AfCFTA.
Countries with infant industrials do not want a neighbour to be able to import a Chinese T-shirt and sew a stripe on it to call it African.
But supply chains are not yet set up to deliver Beninese cotton to the textile factories of Lesotho or Mauritius. So there are more late nights and s’il vous plaîts on the horizon to get over this finish line and to plot out workable measures for each stage of the AfCFTA’s growth and development.