The African Continental Free Trade Area

• DOI: http://doi.org/10.1111/ajes.12317
• Author: Franklin Obeng‐Odoom
• Published date: 01 January 2020
• Date: 01 January 2020

The African Continental Free Trade Area

By Franklin Obeng-OdOOm*

abstract. Monopolies continue to dominate world trade by controlling

global production and distribution chains. Neither free trade nor fair

trade has transformed this system; the recent rise in nativism and

pseudo-protectionism has not, and cannot, address these problems

either. The African Continental Free Trade Area (AfCFTA), the largest

free trade area in the world, promises to be different. AfCFTA rejects

classical, neoclassical, and Marxist theories of trade, appealing, instead,

to non-aligned pan-Africanism. It advocates continental free trade as a

way to overcome the lingering effects of slavery, colonialism, and

neocolonialism. However, its exclusive focus on continental Africa, its

disinterest in systemic redistribution, and encouragement of the private

appropriation of socially created land rents prevents AfCFTA from

achieving its goals. In fact, AfCFTA might actually foster inequality—

progress alongside of poverty—and in so doing, undermine the very

essence of this trade regime. What Henry George (1886) called “true

free trade,” a theory based on making land common by socializing land

rent, offers a more promising and powerful model through which to

achieve the pan-African agenda. Indeed, only true free trade can

definitively decolonize global trade.

Introduction

The African Continental Free Trade Area (AfCFTA) promises a new

trade order. Its immediate intention is to liberate Africa from the

shackles of underdevelopment. AfCFTA, in essence, seeks to teach the

world how to avoid trade wars, possible economic depression, and

global political crises.

These are ambitious aspirations and, hence, many questions have

been asked about this new trade regime. Pressing ones include: How

American Journal of Economics and Sociology, Vol. 79, No. 1 (January, 2020).

DOI: 10.1111/ajes.12317

© 2020 American Journal of Economics and Sociology, Inc.

*Associate Professor, Development Studies, University of Helsinki, Finland. Affiliated

with Helsinki Institute of Sustainability Science (HELSUS). Author of Property, Institutions,

and Social Stratification in Africa (Cambridge University Press, 2020). Email: franklin.

obeng-odoom@helsinki.fi

168 The American Journal of Economics and Sociology

does AfCFTA compare to other regional trade agreements? Could

AfCFTA address the issues for which it was established in its cur-

rent institutional design or, if not, under what new designs? Academic

research on these questions is scarce (Fohtung 2019). Most of it is

focused on whether African states tend to exhibit co-operative or

competitive behavior. Even in the Journal of African Trade, the key

outlet for such research, only marginal comments have been made

about AfCFTA, typically endorsing it rather than addressing such ques-

tions (Mold and Mukwaya 2016; Mold 2018). Public and NGO reports

on this new trade regime are far more numerous, and, while valuable,

they seek mainly to explain the nature of AfCFTA and its likelihood

of success. The Economist (2019a, 2019b, 2019c, 2019d) has published

several informative special reports and articles on trade, but none

gives systematic attention to AfCFTA, despite the fact that it is the

largest free trade area in the world.

Focusing on the AfCFTA is, therefore, important. Reflecting criti-

cally on its theoretical motivations and drawing on data from recent

modeling conducted by the United Nations Conference on Trade and

Development (UNCTAD), the African Union (AU), and the AfCFTA

Economics Unit, I argue that AfCFTA has significant potential. Its ad-

vantages have less to do with the potential $3 trillion boost to GDP it

could deliver. Rather, they relate more to the 52 per cent increase in

cross-Africa trade by 2022 (UNCTAD 2018). AfCFTA demonstrates little

concern with staggering inequality and debt crises on the continent,

and it may contribute to impending ecological crises. Pursuing true

free trade as envisioned by Henry George (1886) could help reorient

the continent away from the growth fetish, and toward the need to

redress social stratification and ecological pillage. To succeed, AfCFTA

would need to focus on making African land common, through the

taxation of land rent, which could further decolonize the African trade

system.

Trade Wars and Nationalism

This argument is significant given the state of the world economy today.

The global trading system has come under serious threat. Its founding

protagonist, the United States, has become its sworn antagonist. Not