AfCFTA Phase II negotiations are currently underway, likely with some delay due to the covid-19 pandemic. This phase of negotiations includes the Protocol on Investment, and an interesting challenge lies ahead.
Surveying Africa’s existing legal framework for international investment, one sees a complex picture of interlocking chains and grids.
For one thing, there is the large number of bilateral investment treaties (BITs) signed between African countries.
And then there are the various Regional Economic Community (REC) instruments governing international investment. These include the ECOWAS Supplementary Act, and the SADC Protocol on Finance and Investment. There is also the COMESA Common Investment Agreement, although not yet in force.
As the AfCFTA Agreement states (see Article 5(b) thereof), the free trade areas of the RECs are to be treated as building blocks for the AfCFTA itself. It is fully to be expected that much inspiration will be drawn from the stipulations in the legal frameworks of the various RECs.
Going beyond BITs and REC instruments, there are also non-binding, albeit influential, documents, such as the Pan-African Code on Investment (PAIC), the SADC Model BIT, and the EAC Investment Code.
So, a varied and complex framework, and one into which the AfCFTA Investment Protocol must fit. A veritable jigsaw puzzle indeed.
It’s early days yet, as negotiations are ongoing, but it will be a serious challenge to build a coherent and tightly integrated framework for intra-African investment.