Digital trade provisions in the AfCFTA: What can we learn from South–South trade agreements?

Karishma Banga, Jamie Macleod and Max Mendez-Parra, April 2021

The Heads of State and Government of the African Union in their decisions Assembly/AU/4(XXXIII) of 10 February 2020 and Ext/Assembly/AU/Decl.1(XII) of 5 January 2021 mandated negotiations for an E-commerce Protocol to the African Continental Free Trade Area and endorsed December 2021 as the deadline for its conclusion, respectively. This paper analyses digital trade provisions in existing South–South (S–S) trade agreements, with the aim of helping negotiators and policymakers from Africa better understand the practical policy implications behind typically existing and upcoming digital trade-related provisions. This can help guide the design of an effective E-commerce Protocol in the AfCFTA that facilitates inclusive development in Africa.

Digital trade involves products ordered digitally but delivered physically through online marketplaces (e.g. ordering a book from Amazon) as well as products that are wholly electronically delivered (e.g. buying an e-book) – that is, electronically transmitted or ET products. Digital trade provisions, for the purposes of this report, involve the rights and obligations in trade agreements that affect e-commerce. The African market is an important destination for the ET exports of African countries. South Africa, Mozambique, Kenya, Tanzania and Mauritius emerge as the top 5 African countries driving intra-African exports of potentially digitable products i.e. potential ET products, with South Africa accounting for 46% of total intra-African exports and 31% of intra-African ET imports. Some countries are highly dependent on intra-African trade for ET products; 70% of exports of digitable products by Rwanda, Mauritius, Namibia, Burundi, Togo, Zambia, Ghana, Zimbabwe and Eswatini are intra-African.